Nottingham City Council v Housing 35 Plus Ltd [2024] UKUT 349 (LC)

Upper Tribunal (Lands Chamber) 14 November 2024

The Upper Tribunal has held that the rules of co-operative society's management structure did not meet HMO licensing exemption requirements.

The local authority (“Nottingham City Council”) issued Housing 35 Plus Ltd, a co-operative society, with two financial penalty notices of £15,000 each after finding that it was managing or being in control of two houses in multiple occupation (“HMO”) that had not been licensed – a breach under section 72(1) of the Housing Act 2004. Housing 35 Plus Ltd appealed to the First-tier Tribunal, arguing that because it was a co-operative society the two properties were exempt under paragraph 2B of Schedule 14 of the Housing Act 2004 and therefore no offence had been committed. The First-tier Tribunal ruled in favour of Housing 35 Plus Ltd, finding that it was a co-operative society and that it had met the conditions of paragraph 2B, thus exempting the two properties from HMO licensing. Nottingham City Council appealed.

The Upper Tribunal (Lands Chamber), in allowing the appeal, held that the First-tier Tribunal had erred – the rules of Housing 35 Plus Limited did not ensure that all of its management decisions were made by its members at a general meeting, which was required by paragraph 2B. Instead, the general meeting's role was to discuss management decisions made by the management committee, rather than making those decisions themselves. The management committee was authorised to make day-to-day management decisions according to the aforementioned rules. Consequently, paragraph 2B was not satisfied, and therefore, the two properties were HMOs and subject to licensing requirements. The matter was remitted to the First-tier Tribunal for further consideration of other issues raised in the appeal.

A copy of the judgment is here.

Mudan and another v HMRC [2024] UKUT 307 (TCC)

Upper Tribunal (Tax and Chancery Chamber) 1 October 2024

The Upper Tribunal has held that a property that was not habitable due to the need for repairs was still suitable for use as a “dwelling” because it had the fundamental characteristics of a dwelling.

The appellants (“Mr and Mrs Mudan”) bought a property and paid stamp duty land tax “(“SDLT”) on the basis that it was a residential property. However, they subsequently claimed a partial repayment of the SDLT on the basis that it was not a “residential property” under section 116(1) of the Finance Act 2003 because the building was unsuitable for use as a dwelling (they argued that significant repair work was required before it would be safe for them to move in). HM Revenue and Customs (“HMRC”), though, concluded that it was a residential property. Mr and Mrs Mudan appealed to the First-tier Tribunal (Tax Chamber), but the appeal was dismissed, with the Tribunal finding that a building recently used as a dwelling, which has not been adapted for another use and was capable of being so used again, was a dwelling even though it was not ready for immediate occupation. Mr and Mrs Mudan appealed.

The Upper Tribunal (Tax and Chancery Chamber), in dismissing the appeal, held that the suitability of a property for use as a dwelling depended on the building's fundamental characteristics and nature. The test was the property’s suitability for use rather than its readiness for occupation. The need for repairs was only one factor in its assessment of suitability for use as a dwelling.

This ruling highlights the high threshold that must be met before a building that was previously used as a dwelling is no longer deemed suitable for such use.

A copy of the judgment is here.

Idara v Southwark London Borough Council (extempore)

High Court 8 November 2024

The High Court has held that when seeking permission for an out-of-time appeal against a homelessness decision, an applicant must show good reason for the failure to meet the deadline and any subsequent delay.

A local authority (“London Borough of Southwark”) had offered a housing applicant, Ms Idara, accommodation on the basis that she was homeless. However, Ms Idara refused the property, believing that the property was unsuitable and requested a review of that decision under section 202 of the Housing Act 1996. London Borough of Southwark conducted the review but determined that the property was suitable and had, therefore, discharged its duty under section 193(2) of the Housing Act 1996.

Ms Idara sought to appeal against the review decision but, after contacting Citizens Advice, could not find a solicitor to help her with the appeal within the official 21-day period for bringing an appeal. When she did find a solicitor, an error made by the solicitor’s firm meant that her application for permission to appeal was lodged out of time.

The County Court heard her application for permission to appeal out of time but rejected it – it held that Ms Idara had to show that there was a good reason for not issuing the appeal in time and for any subsequent delay. While it found that Ms Idara had a good reason for the initial delay (i.e. that she was unable to find a solicitor), she did not have a good reason for the second part of the delay, i.e. (the error made by the firm of solicitors). Ms Idara appealed.

The High Court, in dismissing the appeal, held that under section 204(2A)(b) of the Housing Act 1996, the County Court’s interpretation had been correct. There was no good reason for the delay from the point when the solicitors were instructed to make the application for permission to appeal. Consequently, Ms Idara did not satisfy the requirements to allow the Court to use its discretion to allow a homeless applicant to bring his or her appeal out of time.

This is an extempore (oral) decision, so no written judgment is available yet.