Housing – Selective licensing – Fit and proper person – Appellant local authority appealing against decision of First-tier Tribunal (FTT) concerning refusal and revocation of licences under Part 3 of Housing Act 2004 – Upper Tribunal upholding decision – Appellant appealing – Whether FTT to make own assessment on date of appeal whether individual “is” fit and proper person to be licence holder or “was” fit and proper person when decision made – Appeal allowed
The first respondent and companies belonging to her (including the fourth respondent) owned residential properties in the Walthamstow area.
Following the first respondent’s admitted offences of knowingly or recklessly supplying false information in connection with licence applications, the appellant local authority refused to grant, or revoked licences granted to the respondents under Part 3 of the Housing Act 2004.
The appellant concluded on the evidence that the second respondent (of which the third respondent was the sole director at the time), and the third respondent herself, were not fit and proper persons to be licence holders because the third respondent had been closely involved in the family property rental business and was tainted by the unlawful conduct of the first respondent, such that she was not a fit and proper person.
The respondents appealed to the First-tier Tribunal (FTT) which dismissed the appeals by the first and fourth respondents but held that the second and third respondents were fit and proper persons to be licence holders.
The Upper Tribunal (UT) upheld that decision: [2022] UKUT 241(LC); [2022] PLSCS 154.
The appellant appealed. The key issue was whether, when hearing such an appeal the FTT made its own assessment whether, on the date of the appeal, someone “is” a fit and proper person to hold a licence; or whether the FTT had to determine whether the decision of the local housing authority to grant, refuse or revoke a licence was wrong, and consider whether the individual concerned “was” a fit and proper person on the date that decision was made.
Held: The appeal was allowed.
(1) Schedule 5 to the 2004 Act contained the detailed procedure which the local housing authority had to follow when deciding to grant, refuse or revoke a licence. Paragraph 34(2) of schedule 5 stated that the appeal was to be by way of a re-hearing but might be determined having regard to matters of which the authority was unaware.
The word “but” enabled something to be done which would not otherwise be permitted.
Without the proviso, the FTT would not be entitled to consider matters unknown to the primary decision-maker.
The proviso assisted in resolving the issue as to when the question of fitness and propriety had to be considered.
Without it, the FTT would be constrained to consider only those matters that were known to the housing authority, and therefore by necessary implication, known and in existence at the time when the decision was made.
That pointed inexorably to the conclusion that the task of the FTT was to determine whether the decision under appeal was wrong at the time when it was taken.
The question for the FTT was whether the authority should have decided the application differently: London Borough of Waltham Forest v Marshall [2020] UKUT 35 (LC); [2020] 1 WLR 3187 considered.
The fact that the FTT was empowered by the proviso to consider matters that were not known to the housing authority indicated that the FTT had to make up its own mind on the question of fitness and propriety, when deciding whether the application should have been refused or granted, or whether the licence should have been revoked.
That would encompass a relevant matter which existed at the time of the decision, such as a conviction or relevant professional qualification.
(2) Parliament had decided that a certain procedure had to be followed if a licence was to be revoked.
If the local housing authority decided to grant a licence and it subsequently transpired that the licence holder was not a fit and proper person, it could correct the situation by following that procedure.
Conversely, if someone became a fit and proper person after the refusal and prior to the hearing of the appeal they could, and should, make a fresh licence application.
The UT was wrong to find that it was open to the FTT to decide the appeal by addressing fitness and propriety as at the date of the appeal.
Moreover, it was wrong to do so based on material that did not exist at the time of the decision, and which could not possibly have been relevant to the question whether the appellant’s refusal or revocation of the licences was wrong at that time.
(3) Where a re-hearing on appeal did not involve the appellate tribunal starting afresh, it might still be required to make up its own mind on the application in place of the original decision maker.
In making that evaluation the appellate tribunal had to pay proper attention to the decision under challenge and the reasoning behind it.
If the decision was based on the application of a lawful policy it had to ask itself whether the impugned decision, and any different decision that it proposed to make, was in accordance with that policy.
The party challenging the decision had to satisfy the appellate tribunal that it should take a different view from the primary decision maker: Marshall and London Borough of Brent v Reynolds [2001] EWCA Civ 1843; [2001] PLSCS 259; [2002] HLR 15 considered.
In the present case, the FTT had failed to afford sufficient deference to the appellant’s decision and the reasons for it.
The FTT might have been entitled to reach the conclusions that it did, if it had properly directed itself; but it did not properly engage with the material which underpinned the appellant’s decision and therefore wrongly assumed that it was based on speculation rather than hard evidence which the appellant was best placed to assess.
(4) The correct legal approach and assessment of the relevant evidence would have resulted in the dismissal of the second and third respondents’ appeals to the FTT.
It followed that the appellant’s decisions respectively to revoke the third respondent’s licence and refuse to grant licences to the second respondent pursuant to paragraph 34(3) of schedule 5 to the 2004 Act would be confirmed and the FTT and UT decisions set aside to the extent that they were inconsistent with that confirmation.
Ashley Underwood KC and Riccardo Calzavara (instructed by Sharpe Pritchard LLP) appeared for the appellant; Justin Bates and Nick Grant (instructed by Anthony Gold Solicitors) appeared for the respondents.
Eileen O’Grady, barrister
Click here to read a transcript of Waltham Forest London Borough Council v Hussain and others
