Q. What is a Rent Repayment Order (RRO)?
A. It is an order made by the First Tier Tribunal on the application by the tenants (or if rent is paid by benefit, the Local Authority) where the landlord is found to have committed one or more of several housing-based offences. Most claims are based on failure to obtain an HMO license. The tribunal can award up to 12 months’ worth of rent.
Q. I rent my property to a Mr Jones who then sublets it to HMO tenants under a ‘rent to rent’ arrangement. I have just found out that Jones has failed to obtain an HMO license from the Council. Can I be held liable for this?
A. At the moment, probably no. There was a case recently, Rakusen v. Jepson, where tenants applied to the First-Tier tribunal for a Rent Repayment Order against the property owner and head landlord. The case went to the Court of Appeal, which ordered that the legislation did not permit a RRO to be made against a superior landlord.
So, at the moment you are safe from RROs. However, Rakusen v. Jepson is being appealed to the Supreme Court with the case due to be heard some time in 2023. So, watch this space.
Q. I own several properties, one of which I have just discovered is classed as an HMO and subject to mandatory licensing. I leave the management of all my properties to my agents, who are solely responsible for finding the tenants and dealing with all aspect of management. I understand that the tenants are planning on bringing a claim for a Rent Repayment Order against me. Surely in these circumstances I can’t be held personally liable for this.