A landlord firm which tried to argue that its agent was responsible for failing to organise an additional HMO licence has been handed a £19,753 rent repayment order.

Three tenants took City & Suburban Properties Ltd to a First Tier Property Tribunal where it accepted it didn’t have a reasonable excuse for failing to licence the flat in Fordwych Road, London, for almost three years until February 2024.

Director Laurence Bellman said he had more than 50 years’ experience in the property sector and controlled 20 commercial and residential properties through four property companies. The firm had licences for the other HMOs in its portfolio.

City & Suburban Properties engaged professional agents, Cedar Estates, to manage the property in 2021. Darren Yanover, director of Cedar Estates, told the tribunal he was aware of the additional HMO licensing schemes in London, accepted full responsibility for the offence, and expressed his sincere apologies for not picking up earlier that the property had no HMO licence.

No licence

The landlord’s lawyer argued that ultimately it was the agents’ fault for the property having no licence but that it was one of inadvertence rather than deliberate. However, the judge said: “A reasonable expectation of professional landlords and managing agents is that they should have systems in place for checking the regulatory requirements in respect of a property.

“The respondent and its managing agent knew the legal requirements for HMO licensing and their failure to check that the property had an HMO licence which happened over a period of time including several new tenancies amounted to an act of recklessness.”

The tenants had complained about water leaks and mould in the property. Bellman argued that it had done its best to resolve the water leaks, however, the judge said it considered that both firms had the wherewithal and knowledge to remedy the disrepair quickly.

The tribunal ruled that the amount of the RRO should be 65% of the total rent paid.