A consortium of private landlords has failed in a challenge to the decision to place the entire borough of Croydon in a selective licensing scheme under the Housing Act 2004.
Sir Stephen Silber dismissed a judicial review challenge by the Croydon Property Forum – formed to promote and safeguard the interests of private rented sector landlords in the borough – to the March decision. The forum had challenged the validity of the scheme on the grounds that local developers and landlords were not adequately consulted.
In his decision, Sir Stephen Silber said: “Parliament has given powers to local authorities to deal with anti-social behaviour and criminal activities in their areas. One such power is the designation of an area as a selective licensing scheme under the provisions of the Housing Act 2004 [the 2004 Act].
“Such a scheme may be controversial as it identifies the area so designated as an area which has problems of anti-social behaviour and criminal activities. In addition, some local landlords believe such designation will reduce the value of their properties in the area concerned as first, it stigmatises the area designated and second, it will lead to higher costs in the form of licensing fees, which are required under the scheme and increased borrowing costs.”
He added that the background to the decision was that the council was concerned that there had been a significant and persistent problem with crime and anti-social behaviour in the borough, and second, that this was linked to the management of private rented housing as some, or all, private landlords were failing to take appropriate actions to help combat the problem. In addition, the great need for more housing in Croydon meant it was estimated that an additional 27,000 homes, including those available for private letting, would be needed by 2031.
He said that, before making a designation, the council had to comply with the consultation requirements of s.80(9) of the Act, which required it to take reasonable steps to consult persons who are likely to be affected by the designation; and consider any representations made in accordance with the consultation.
But he found that the council had “a comparatively wide discretion” as to how the consultation process was conducted, adding: “I am quite satisfied that nothing went ‘clearly and radically’ wrong in the consultation exercise bearing in mind that it is almost invariably possible to suggest ways in which this or indeed any consultation exercise might be improved.”
The effect of the scheme is that private landlords of properties let as separate or single dwellings in the area are required to obtain a licence. If a licence is not obtained, the local authority could take enforcement action, including commencing prosecutions leading to fines. As part of the licensing process, the local authority has to be satisfied that any landlord is a “fit and proper person” before granting a licence, for which a fee is chargeable.
The Queen (on the application of Croydon Property Forum Ltd) v London Borough of Croydon Administrative Court (Sir Stephen Silber) 13 August 2015
Jonathan Manning and Justin Bates (instructed under the Direct Access Scheme) for the claimant
Clive Sheldon QC (instructed by Wragge Lawrence Graham) for the defendant
