Housing – House in multiple occupation – Civil penalty – Reasonable excuse – Appellant holding lease of house in multiple occupation – Local authority discovering defects in property – Appellant failing to remedy defects – Authority subsequently imposing financial penalty – First-tier Tribunal (FTT) confirming penalty but reducing amount payable – Appellant appealing – Whether appellant having defence of reasonable excuse – Whether FTT failing to take account of relevant considerations when setting penalty – Appeal dismissed
Until 28 September 2021, the appellant held a lease of a house in multiple occupation (HMO) at 161 Praed Street, London W2. In June 2020, following complaints received from a tenant, the respondent local housing authority wrote to the appellant requiring it to remedy defects in, amongst other things, the fire alarm system serving the building. The appellant undertook certain works but, on 30 July 2020, when the respondent’s enforcement officer attended the property, he found a number of defects including in the fire alarm system.
In December 2020, the respondent imposed a financial penalty of £16,000 on the appellant pursuant to section 249A Housing Act 2004 on the basis of breaches of the Management of Houses in Multiple Occupation (England) Regulations 2006, made pursuant to section 234(1) of the Housing Act 2004, and identified at the inspection on 30 July.
The appellant appealed. The First-tier Tribunal confirmed the imposition of the financial penalty, reducing the total amount payable marginally to £15,750. The FTT granted permission to appeal against that decision. The respondent did not participate in the appeal.
The issues were: (i) whether the FTT was wrong to reject the appellant’s argument that the breaches had not been made out to the required standard of proof or had failed to give sufficient reasons; (ii) whether it should have found that the defence of reasonable excuse was established; and (iii) whether the FTT had failed to take account of relevant considerations when setting the penalty.
Held: The appeal was dismissed.
(1) The starting point in interpreting the 2006 Regulations was section 234(1) of the 2004 Act. The purpose of regulations made under that power was to ensure that there were satisfactory management arrangements in place; and satisfactory standards of management were observed. The focus of both the power and the Regulations themselves was on standards of management, but management need not be a limited concept nor was there any reason why regulations about management should not require managers to achieve specific outcomes.
Regulation 4(1) provided that “the manager must ensure that means of escape from fire in the HMO are – (a) kept free from obstruction; and (b) maintained in good order and repair”. Regulation 4(2) provided that “the manager must ensure that any fire-fighting equipment and fire alarms are maintained in good working order”. The duty under regulation 4(1) was to be contrasted with the duty in subparagraph (4) to “take all such measures as are reasonably required to protect occupiers of the HMO from injury” having regard to the characteristics of the HMO itself.
Regulation 7 required the manager to “ensure” that all common parts of the HMO were maintained in a safe and working condition and, in particular, to ensure that the common parts were fitted with adequate light fittings available for use at all times by every occupier of the HMO. The manager had to ensure that handrails and bannisters were to be kept in good repair and that light fittings were available at all times. Simply having a management procedure in place which involved regular inspections and prompt remediation would not prevent a breach.
(2) It was significant that the statutory scheme did not make every breach of duty a criminal offence. Section 234(4) provided that it was a defence to proceedings for the offence of failing to comply with regulations that a person had a reasonable excuse for not doing so. A landlord who had implemented a comprehensive inspection regime and who conscientiously remedied every defect on becoming aware of it would not be guilty of an offence whenever somebody obstructed a means of escape by dumping rubbish on it.
The natural meaning of regulations 4(1), (2), and 7(2) required the achievement of an outcome or a state of affairs. A duty to ensure that means of escape were kept free from obstruction and maintained in good order was performed if the means of escape were not obstructed or in disrepair, and it was breached if they were. Similarly, a duty to ensure that adequate light fittings were available for use at all times by every occupier had been performed if the light fittings were adequate and was breached if they were not.
The FTT was entitled to find that, in the absence of a reasonable excuse, the existence of defects was enough in itself to prove breaches of the 2006 Regulations to the criminal standard.
(3) To provide a defence, the “reasonable excuse” had to relate to the offence in question. The defence was construed broadly since, absent a reasonable excuse, the offence was one of strict liability. The duty to ensure the safe condition of the HMO was not a duty to remedy defects of which the manager had notice.
It was for the appellant to inform itself sufficiently of the condition of the premises to enable it to take timely remedial action. The evidence was that it had failed to do so. In those circumstances, the FTT was entitled to find that the appellant’s ignorance of the defects was not a reasonable excuse because it had failed to take proper steps to inform itself: Palmview Estates Ltd v Thurrock Council [2021] EWCA Civ 1871; [2022] EGLR 4 considered.
(4) The FTT had allowed a 25% deduction from the penalty the respondent had initially been minded to impose in respect of the lesser of the offences (the defective lighting). It gave reasons for rejecting the submission that the more serious penalty for breaches relating to fire precautions should be reduced.
The respondent’s own policy was a guide, not a straitjacket, and the FTT had it in mind when assessing the appropriate penalty and gave the reasons it felt justified a reduction from the figure assessed by the respondent. The penalty it ended with for the breach of regulation 7 was modest and it is not the purpose of an appeal to fine tune an assessment which had been arrived at lawfully. It was not possible to say that the penalty was not one which a properly directed tribunal could have imposed.
Edward Blakeney (instructed by Collins Benson Goldhill LLP) appeared for the appellant; The respondent did not appear and was not represented.
Eileen O’Grady, barrister
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