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Horley property management business fined £16,000-plus for breaching HMO legislation

02 March 2021

FAILURE TO comply with Houses in Multiple Occupation (HMO) legislation aimed at protecting tenants has seen a Horley-based property management company being fined over £16,000.

Reigate and Banstead Borough Council successfully took action against the private property management company for breaching the fire safety and overcrowding terms of its HMO licence for a two-storey property located in Redhill.

The level of the penalty levied took account of the fact that the company involved attempted to conceal its offending. The fines were issued by Reigate and Banstead Borough Council as an alternative to prosecution through the courts using powers listed under Section 249A of the Housing Act 2004.

Reigate and Banstead Borough Council takes licence breaches very seriously, and particularly so when it comes to the safety of residents living in private rented accommodation.

Commenting on the prosecution, Councillor Mrs Natalie Bramhall, executive member for neighbourhood services, said: “Reigate and Banstead Borough Council works closely with landlords to provide advice and guidance to ensure the properties they manage are properly maintained and safe for residents. However, when serious breaches occur and offences are committed, we will not hesitate to take the appropriate enforcement action.”

Bramhall went on to state: “We would fully expect a portfolio management company to be organised and compliant. They are wholly responsible for inspecting the property and ensuring that it’s safe. By not carrying out regular inspections, especially so in this instance for fire safety, they were not able to demonstrate due diligence which is reflected in the level of the fine.”

Breach of the licence

In addition, Bramhall said: “The company representative also tried to hide the fact that there were more people occupying the property than allowed by the licence. While one additional person may seem insignificant, the offence was a breach of the licence. Providing false information is fraud.”

Issuing a warning signal, Bramhall commented: “Please be assured that, while our ways of working may be slightly different to usual due to the current COVID-19 restrictions imposed by the Government, we are still working. Some allowances may be made, but it is still every landlord’s responsibility to ensure that their property is safe and compliant.”

From 1 October 2018, any property that has five or more tenants requires a mandatory HMO licence. Operating a property without a licence is punishable on summary conviction with an unlimited fine or the imposition of a civil penalty of up to £30,000.

While a property is unlicensed, no rents are payable. Irrespective of whether Reigate and Banstead Borough Council takes enforcement action, tenants and ex-tenants can apply for a Rent Repayment Order for rent paid during the unlicensed period.