Can a licensing authority place limits on what sort of person can occupy a house of multiple occupation? Yes, rules the Supreme Court.

October 25, 2018

Alistair Cantor considers the recent decision of the Supreme Court in Nottingham City Council v Parr [2018] UKSC 51, which conclusively establishes licensing authorities’ powers to limit HMOs occupation to certain classes of person through use of licensing conditions under the Housing Act 2004.  References in bold square brackets are to paragraphs of the Supreme Court’s judgment, available here.

Nottingham City Council (“NCC”) was the licensing authority for two HMOs used for lettings to students.  It issued licensing conditions precluding attic rooms in those houses being let as bedrooms since they did not meet its own standards for minimum space. The Respondents appealed successfully to the First Tier Tribunal.  In relation to one of the rooms, the FTT substituted its own condition [11] which read:

“The second floor front bedroom may only be used for sleeping accommodation by a person engaged in full-time education and who resides in the dwelling for a maximum period of 10 calendar months over a period of one year.”

NCC appealed to the Upper Tribunal.  The appeal was dismissed and the UT further ordered that the condition substituted by the FTT be applied to both rooms [11].  NCC’s appeal to the Court of Appeal was unsuccessful, the court (Longmore, Lewison and Briggs LJJ) ruling against NCC and going on to make its own variations to the licenses to include two further conditions [13]:

“(i) that the communal space on the ground floor, comprising a kitchen/diner and living room area, be kept available for communal living space only;

(ii) that no bedrooms may be let to persons other than students engaged in full-time education.”

NCC appealed to the Supreme Court.

The Supreme Court unanimously dismissed the appeal.  The manner in which the statute had been drafted was sufficiently wide to permit the conditions imposed by the courts below, which sought “to regulate “the … occupation of particular parts of the house by persons occupying it” and fall squarely within the natural meaning of section 67(2)(a)” [18].

Furthermore, there was no inconsistency between that reading of the statute and its object.  References elsewhere in the Housing Act 2004 to the manner of occupation and characteristics of occupants were significant [20], as were such references in predecessor legislation [21]. Contrary to submissions made on behalf of NCC, the conditions applied by the courts below would not remove student shared houses from the regulatory framework, in fact tending to have the opposite effect since they would be subject to inspection and “rigorous examination” [24].  Nor would standards be undermined if regard was had to the likely “mode of occupation”.  For example, where occupants were living “cohesively” the communal areas, such as kitchens and living rooms, would be of greater benefit – and thus recompense for a smaller living area – than where occupants lived independently [25].  The approach endorsed by the court did not mean that lower standards should apply that would otherwise were the class of occupants different, simply “that there will be certain circumstances in which, as a matter of common sense, it will be appropriate to have regard to the mode of occupation when applying the same objective standards which apply to all HMOs” [26].

The court concluded that “the power to impose conditions under sections 64 and 67, Housing Act 2004, in order to make an HMO suitable for a particular number of households or persons, can be used so as to limit the class of persons for whom the HMO is suitable” [27].

As to the second ground of appeal – that the conditions imposed were irrational and impossible to enforce – the Supreme Court only agreed to the limited extent that restricting occupation to 10 months per calendar year was irrational.  The conditions would be varied accordingly.  Otherwise, that ground of appeal would fall to be dismissed also [33-37].

Discussion

This will be a decision of interest to both landlords and local authorities, not least due to the expanded definition of houses of multiple occupation which came into force on 1 October 2018, which will ensure many thousands more properties fall within the licensing regime.  Local authorities now have the power to confine HMOs to being occupied by certain classes of occupants, if justified, and to direct licensing conditions towards ensuring the property is suitable in terms of use for the likely mode of occupation.

There was no prescribed minimum room size for sleeping rooms in HMOs at the time NCC imposed its original licensing conditions, or when the proceedings were before the FTT, UT and Court of Appeal.  Only nine days before the Supreme Court’s judgment was handed down, minimum room sizes for HMOs came into force under amendments to HA 2004 made by The Licensing of Houses in Multiple Occupation (Mandatory Conditions of Licences) (England) Regulations 2018.  There is an 18 month transitional arrangement for existing licensed HMOs.  Were there not, it appears that one of the rooms concerned in this case – with only 5.89 metres of floor space of at least 1.53 metres floor to ceiling height [9] – may well have fallen below the minimum standard for a single occupant over 10 years of age, which is now set at 6.51 square metres of space with at last 1.5 metres of floor to ceiling height.