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Question

Licensing of Private Rented Properties (England)

Selective Licensing: What’s the legal challenge?

18 Aug 2016 | 4 comments

Adrian, I’m sick to the back teeth of this landlord tax aka “selective licensing” I have challenged the councils on how and why they are justified for the £500 they demand from me for my properties to be rented out (they are NOT HMOs) am about to do battle with another.

Please can you advise what legal standing there is on this and what challenges can be mounted?

Answer

4 Comments

  1. guildy

    This is unfortunately very difficult (and very very expensive). The usual way to challenge a scheme would be way of a Judicial Review. The starting rate for this is usually around £15k (just for the permission stage).

    The first thing that can be checked is if they are within the limits of the The Selective Licensing of Houses (Additional Conditions) (England) Order 2015.

    Also, the main challenge that I see is based on the consultation process that was followed (or lack thereof). I think a few cases have been successful on this ground but the court outlines the error so the local authority go off and do whatever the court said with a new consultation and the scheme comes in anyway! Therefore, it’s often only a delay (and an expensive delay at that).

  2. sjcollett

    Thanks for this, I had read this and applied it to my argument so far.

    My main bugbear is what is actually happening to this money? Why is it being charged? What is it actually paying for? What are the results of these schemes? I am sick to death of rolling over and writing cheques just because I am a landlord.

    I have requested to know from the local council if Peabody (one of the largest landlords in the area and a housing association) have signed up every flat of theirs that they rent out. If not, this makes a mockery of the entire scheme when the largest landlord in the area is not forced to comply.

  3. daviddortongibson

    The first point to understand about Judicial Review (other than the point that Adrian makes about cost!) is that it is not a challenge to the decision, but a challenge to the process by which the decision was made. This is why you will the JR and then they remake the same decision by the right process and still do what they want.

    Although you talk about fighting again for another property, there will generally be no ability to argue about the individual properties, you will have to argue at about the whole scheme in most cases.

    Part 3 of the Housing Act 2004 deals with Selective Licensing (can be found on the legislation.gov.uk website). The first point to note is that a scheme cannot be run because the council want to run a scheme, it can only be run of one of the stated reasons exists. The original act included just 2 reasons and then further reasons were added by the regs Adrian mentions above. Originally it was antisocial behaviour and areas of low demand. Now it includes a high percentage of rented properties, housing conditions, an influx of migration or high levels of deprivation. All of these are more complex than the simple statements and would need to be studied for any challenge.

    All the decisions should be public documents, probably cabinet member decisions, that you should be able to see the reports and decisions on your local authority web site. The decision may also have been considered by an overview and scrutiny panel, again public documents. There may be clues in here that will help you unpick it as typically, in the current climate, these schemes are seen as a way of bringing in money that allows more staff to work on housing issues.

    Councils can only introduce these schemes where (according to section 81) they have considered there are any other courses of action available (ie this should be the last resort not the first) and they consider that the scheme will make “significant” difference.

    All schemes have to be reviewed every 5 years. and looking at the last two point you can see that there is an argument that councils cannot renew these schemes. What I mean by that is either the problem has been cured by licensing, so no renewal can be justified, or the problem still exists so it is not having a significant effect!

    As the local authority decide which properties need to be licensed, why not get landlords together before the renewal and suggest that landlords who are members of a recognised accreditation scheme should be completely exempt or receive an almost free entry to the scheme. Ie, if landlords can show they are already engaged with a voluntary scheme they do not need the mandatory scheme. If they misbehave they will get thrown out of the voluntary scheme and have to engage with the statutory scheme. Adrian runs such a scheme (Private Rented Sector Accreditation Scheme) that is free for any local authority to adopt.

    Sadly much of this is a combination of the few ruining it for the majority and local authorities being underfunded while we struggle with the massive national debt.

    • sjcollett

      Thank you so much for all this additional information.  This is very useful and added fuel for my fire 🙂

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