Tribunal Overturns Rent Repayment Order in HMO Case

Figuring out who a tenant’s immediate landlord is in a rent-to-rent case has taken another twist.

The Upper Tribunal (Lands Chamber) was hearing an appeal by landlord Amlendhu Kumar against a £7,450 rent repayment order made by the First-Tier Property Tribunal.

Kumar complained that the tenants did not rent their homes directly from him and had never paid him rent.

The tribunal heard that Kumar owned a house in Balham, South London, that he rented to Like-Minded Living Ltd (LML) as a rent-to-rent shared house. The contract had a clause limiting sub-tenancies to four renters.

LML paid Kumar £2,600 monthly for leasing the property and was responsible for the day-to-day management.

Tribunal ruling overturned

Unbeknown to Kumar, LML rented rooms to five tenants, which made the property an unlicensed HMO. The rent-to-rent contract lasted until September 2019, but the tenancies ended in 2020.

Kumar argued that LML was the immediate landlord as the company received rent from the tenants after his rent-to-rent arrangement expired in September 2019.

The tribunal was also reminded that in Rakusen v Jepsen, the Supreme Court ruled that a rent repayment order can only be made against the immediate landlord.

Martin Rodger KC, the Deputy Chamber President, set aside the first tribunal’s ruling on the grounds:

Kumar was not the immediate landlord
Kumar did not have control of managing the HMO

He also ruled that Kumar’s conviction for running an unlicensed HMO was overturned and discharged him from paying the rent repayment order.