Appealing Developments: Portsmouth HMO Cases Climb the Legal Ladder

It used to be that the law defined the way we operated. Landlords built a business knowing what the rules were and PCC enforced based on those rules and where there was a dispute about interpretation of those rules, either side would go to the First Tier Tribunal, plead their case and then whatever the Tribunal decided became the new, clearer definition of the rules and both sides would change their operation accordingly. 

Sadly, those days have passed and PCC appear emboldened enough to tell the experienced surveyors on the Tribunal when they think they are wrong and to enlist expensive Gray's Inn barristers to plead their case on appeal at higher courts, sadly this behaviour has forced local landlords to do the same (without the high cost of London barristers) in order not to be beaten into submission.

What Is Going On?

PCC and local landlords have never had an equal relationship – it has always been a role of enforcer and those enforced upon and any attempt at negotiation has depended more on goodwill than any power on the part of landlords (or as President Trump would say, we don't have the cards).

The good news was that when we felt hard done by, the team at PCC would listen and at times, seek to make our lot slightly easier – they never 'gave in' but they did listen and if some element was being enforced too strongly or causing difficulties for landlords without an obvious benefit for tenants, then a conversation at the HMO Governance Board or in one of our other forums was usually enough for small modifications which benefited all.

Sadly, that all changed 6 or 7 years ago – maybe due to management changes at PCC or maybe at the behest of councillors or some other factor, but since then the détente appears to have ended. A labour MP recently, talking about the benefits debate said, "Downing Street see us as an inconvenience, people to manage, not to listen to. When we are invited into Number 10, and it doesn't happen often, it is to be told what to think" – sadly, that is exactly how Portsmouth landlords feel they have been treated for the past few years. 

Two Cases / Two Appeals

Case 1 - PCC Appeal

 This is the debate about how big a home needs to be.  According to PCC, a 4-bed HMO (based on a nice 3-bed terraced house) in Binsteed Road which was licensed as a 4-bed from 2013-2018 is now no longer big enough.

We appealed this to the First Tier Tribunal and their view was that a property of this size (98 sq. m) was perfectly adequate for 4 occupants (and note the FTT panel included two FRICS surveyors who one would imagine, have a better understanding of such things than a council officer).

Sadly, PCC disagreed with the highly qualified surveyors and have proceeded to the Upper Tribunal to argue that what they say must be the law and any national rules or regulations are irrelevant in this case. 

 Case 2 – PDPLA Appeal

 This is our long running argument that the Licence Conditions PCC impose as part of an HMO licence are unclear, open to misinterpretation and in certain cases could put landlords into a difficult position where to comply would put them in breach of some other regulation or maybe even leave the landlord open to criminal prosecution through no fault of their own.

We appealed the Licence Conditions to the First Tier Tribunal and to be honest, the decision from that body was mixed – they ignored some points, agreed with PCC on others and found in our favour on a few. Wishing for a more conclusive outcome, we are now also proceeding to the Upper Tribunal and will be seeing PCC in the Appeals Court in London sometime in the New Year,

What Next?

  We wait – both appeals will be a review of the First Tier Tribunal case rather than a retrial, the Binsteed Road 'space' appeal  will be a review of the documents rather than an in-person appeal whereas the licence conditions case will be a day in court for all concerned, but again will be decided on the courts view of the accuracy of the First Tier Tribunals decision.

What the two cases have in common, from a PDPLA perspective, is that PCC have simply ignored the relevant guidance on licencing issued by central government. So, not only do PCC ignore landlords locally, they lack respect for the Ministry of Housing, Communities and Local Government as the national authority that defines the framework both landlords and councils are supposed to work within and follow.

One would hope we could resolve these issues without  going to London and incurring the high costs of barristers but for that both sides need to be willing to compromise  which sadly, seems unlikely. Hopefully, after all this is over we can find some common ground and maybe re-establish some of the détente of the past, rather than more expense for the city's taxpayers and stress and distress for local landlords.

Until then, watch this space....