Tribunal orders management company to refund £84K rent to tenants in unlicensed accommodation

Published: Thursday, 22nd September 2022

A tribunal has ordered a student accommodation management company to refund more than £84,000 in rent after it ran an unlicensed house in multiple occupation (HMO).

Student Castle in Osney Lane is purpose-built student accommodation which opened in September 2020 and is managed by SC Osney Lane Management Ltd.

Student Castle includes 242 rooms in 41 cluster flats.

Oxford City Council’s ‘additional’ HMO licensing scheme requires landlords and managers of all shared rented houses and flats to have a licence.

A council officer inspected Student Castle on 2 September 2021 and advised the management company that the cluster flats required an HMO licence.

SC Osney Lane Management Ltd applied for an HMO licence on 15 September 2021. This was issued on 9 December after a further inspection in October.

People living in unlicensed accommodation can apply to a First Tier Tribunal for a rent repayment order. This allows tenants to claim back up to a year’s rent from landlords if the house they live in is unlicensed.

The council advised people living in the cluster flats that they could apply for a rent repayment order and signposted them to Flat Justice and Justice for Tenants for specialist advice and representation.

A total of 44 tenants subsequently made a group claim to the tribunal and their case was heard in Cambridge in July.

While the tribunal accepted that the failure to obtain a licence was “by omission rather than deliberate”, it found that the cluster flats needed a licence and were therefore in breach of Oxford’s additional HMO licensing scheme.

On 11 August, the tribunal decided that each claimant should receive a 35% refund of rent paid while Student Castle was unlicensed. 

The total amount of rent to be repaid to the 44 claimants is £84,877.

Licensing private rented accommodation in Oxford

Under the Housing Act 2004, licensing is mandatory for HMOs occupied by five or more people. Councils can extend additional licensing to other shared housing where a significant proportion of HMOs are poorly managed and give rise to problems for residents or the general public.

In 2011 Oxford was the first council in England to introduce a citywide additional licensing scheme that required every HMO to be licensed.

The launch of a new citywide ‘selective licensing’ scheme on 1 September means that all private rented homes in Oxford now need a licence – not just shared houses and flats.

Licensing requires private landlords to show that they are complying with the law by meeting safety and management standards, being a ‘fit and proper person’ and meeting council waste storage and disposal requirements.

The start of citywide selective licensing follows government approval of the scheme in April. It means Oxford is the only council area in England requiring a licence for all private rented homes.

Comment

“While this was not a typical case, it does demonstrate the importance of landlords and agents obtaining licences for their accommodation and the potential consequences if they do not.

“Our new selective licensing scheme means that all private rented homes in Oxford now need a licence, not just HMOs. Everyone deserves a decent home and our licensing schemes are vital in helping to ensure that private rented homes are safe, well maintained and well managed.”  

Councillor Linda Smith, cabinet member for housing

“I’d like to thank the tenants who were brave enough to come forward and contact Justice for Tenants and also Oxford City Council, who supported us in presenting the best case."

Al Mcclenahan, local housing authority joint working and training lead, Justice for Tenants