Housing – House in multiple occupation – Licence – Section 90 of Housing Act 2004 — Appellants owning houses in area of selective licensing for HMOs – Respondent local housing authority granting licences to use houses as HMOs subject to conditions requiring provision of carbon monoxide detector and electrical report – First-tier tribunal ruling that respondents had no power to impose such conditions where not required by statute – High Court allowing respondents’ appeal – Appellants appealing – Whether respondents having power to impose disputed conditions – Whether imposition of conditions conflicting with respondents’ duties under Part 1 of 2004 Act – Appeal allowed
The appellants were the landlords of two residential properties in Accrington, Lancashire in an area designated by the respondent local housing authority for selective licensing of houses in multiple occupation (HMOs) under Part 3 of the Housing Act 2004. In January 2014, the respondents granted licences to the appellants to let their properties as HMOs. Pursuant to section 90 of the 2004 Act, the respondents imposed a condition requiring the provision and maintenance of a carbon monoxide detector if gas was supplied to the property and another requiring the provision of a valid electrical installation condition report (EICR) and implementation of any recommendations. In fact, the appellants’ properties had at all material times been compliant with the conditions imposed.
The first appellant challenged the requirement for a carbon monoxide detector and both appellants challenged the requirement for an EICR. The First-tier Tribunal (FTT) determined that the respondents had no power, under the legislation properly construed, to use the licensing regime introduced by Part 3 to require landlords to upgrade their properties, or to introduce new equipment or facilities, by way of licence conditions. In particular, the requirement to provide a carbon monoxide detector and a valid EICR went beyond regulating “the management, use or occupation of a house concerned” under section 90(1) of the 2004 Act. That phrase could not legitimately enable the respondents to impose conditions relating to an improvement, as distinct from conditions calculated to address low demand for housing or anti-social behaviour at which selective licensing was aimed. The respondents’ appeal to the Upper Tribunal was allowed ]2015] UKUT 489 (LC); [2015] PLSCS 276.
The appellants appealed. The issues raised were: (i) whether the powers of “management” conferred by section 90(1) extended to works which improved or changed the condition of the property or added new facilities and equipment which were not already present; and if so (ii) whether in light of section 90(5)(a) it was open to the respondents to impose conditions under their licensing powers to address hazards if it could have addressed them by exercise of its Part 1 functions.
Held: The appeal was allowed.
(1) In Parts 1 to 3 of the 2004 Act, a distinction was drawn between conditions regulating the management, use and occupation of the house concerned and conditions regulating its condition and contents. Section 67(1) in Part 2 of the 2004 Act, in conferring powers to include conditions in the case of HMOs both regulating the management, use and occupation of the house concerned and its conditions and contents, illustrated the distinction. That provision contrasted with section 90(1) which provided only for conditions regulating the management, use or occupation of the house concerned: unlike section 67(1), it did not go on to refer to and expressly empower the inclusion of conditions to regulate “its condition and contents”. The assumption had to be that the difference was intentional. Whereas in section 67, the power to include conditions relating to facilities and equipment was an aspect of the power conferred by section 67(1), section 90(1) conferred no such power: the power to include or the mandatory requirement for conditions was as expressly defined in section 90(3) and (4), and was additional to the limited power in section 90(1).
(2) The Upper Tribunal fell into error in accepting that there was no link between the statutory test for the designation of a selected licensing area and the imposition of conditions to regulate the property in that area. It went too far, and was contrary to the principles of public law, to say that the statutory purpose of selective licensing did not cut down the ambit of the local authority’s discretion to impose conditions. Though it was not necessary that there should be demonstrated a direct and unequivocal link to the statutory purpose, and it sufficed if the local authority had reached the conclusion that a particular condition was appropriate as a means of addressing the statutory purpose of selective licensing, the powers conferred were confined to including conditions for that purpose. That accorded with the structure of the 2004 Act. The improvement of housing standards was primarily a matter for Part 1, and in the case of HMOs Part 2. Licensing under Part 3 was to address the management, use or occupation of private sector accommodation as it affected others in the locality, with a view to ameliorating the problems of low housing demand and anti-social behaviour which occasioned designation as a selective licence area.
(3) Section 90(5) appeared to be premised on the local authority having powers under section 90 (without further specification) to remove or reduce category 1 or category 2 hazards, whilst at the same time requiring the authority to seek to identify, remove or reduce such hazards by the exercise of its Part 1 powers. But the premise related to the additional powers under section 90(3): it did not connote that a power was conferred by section 90(1) to include conditions regulating the “condition and contents” of the relevant house. The true purpose of section 90(5) was to re-emphasise (in section 90(5)(a)) the importance of the local housing authority’s Part 1 functions and the primacy to be accorded to seeking to identify, remove or reduce relevant hazards by constant review and inspection, and exercise of enforcement powers, whilst at the same time ensuring (in section 90(5)(b)) that the authority was not prevented from imposing (in accordance with section 90(3)) licence conditions requiring the installation or maintenance of facilities and equipment prescribed by regulations if and when made by the appropriate national authority (as envisaged in section 90(3)(a)).
Jonathan Manning (instructed by Bury & Walkers LLP, of Leeds) appeared for the appellants; Leo Charalambides (instructed by Legal and Democratic Services Hyndburn Borough Council) appeared for the respondents.
Eileen O’Grady, barrister
Click here to read transcript: Brown and another v Hyndburn Borough Council
