LEFT OUT OF LEGISLATION - HMOs and a Household of Three

All seemed well and the viewing went ahead with the result being that the Tenants wanted to rent the property. The Tenants contacted the negotiator to say they would like to rent the property. This led to a conversation between the negotiator and the Agent as to whether the Tenants would be able to let the property, since under the House in Multiple Occupation (HMO) rules it was only possible for the property to be let to a single household, or to a maximum of two unrelated sharers.

Following some guidance from the local council the Agent explained that the council would not accept that the Tenants were a single household and that the property could therefore not be lawfully let to them. The Agent also said that the Landlord had had a change of heart about allowing pets and suggested that the Tenants consider another property which had the requisite HMO license and would accept pets.

These events led to the Tenants making a complaint against the Agent stating that the Agent had been unprofessional and that they were dissatisfied with the advice regarding the HMO rules and referred the complaint to TPO for review.

Investigation

In considering the issues raised, the obligations under the TPO Lettings Code were:

• To provide a service to both landlords and tenants consistent with fairness, integrity and best practice (1d),
• To keep clear and full written records of their relationships with both parties for at least 6 years and produce them when required (1h).
• To treat all those involved in the proposed letting fairly and with courtesy (2a).
• To assess consumer requirements (2e).
• To advise the landlord of the need to obtain necessary consent and/or licence prior to formal creation of tenancy (4e).

The Tenants were three people in a polyamorous relationship who applied to rent a property that didn’t have an HMO licence. The Tenants complained about the Agent’s communication with them, claiming it was unprofessional, lacked clarity about accepting pets, contained contradictory information, and lacked advice about their eligibility due to their relationship status. The Agent advised that the Tenants would not be viewed as a single household by the council, and that they would breach the HMO rules. They also advised that the Landlord had decided not to proceed because they had pets.

The Property had not been designated an HMO by the council and therefore it was only possible for the Property to be let to a single ‘household’ or a maximum of two people if they did not form a single household. For the Property to be let in circumstances that breached HMO legislation it would have exposed the Agent and the Landlord to a substantial fine. The compatibility of the Tenants’ situation with HMO legislation was an issue that needed to be considered. The Agent was not expected to carry out an in-depth legal assessment into whether the Tenants could be classified as a single household under HMO regulations but it would have been expected that the Agent should have had reasonable knowledge of HMO rules along with access to the information on the council’s website.

The Agent could have contacted the council on the day to double check that their understanding was correct, however, with the covid-19 lockdown recently ending it would have created pressures which would have made it difficult for the Agent to have made enquiries. The Agent was not criticised for advising that the Tenants would not have been treated as a single household. However, the Agent’s communication, verbally and in writing to the tenants was not considered professional.

Outcome

From the evidence provided, the Adjudicator was unable to conclude whether the Agent knew about the Tenants’ household situation when they applied for the property and, therefore, that there was a failure to give timely advice on HMO rules. The Adjudicator noted that the Agent had issued an apology for the informal nature of one of the Agent’s communications, adding that the member of staff had been reprimanded for this.

Overall, the complaint was supported in relation the manner of the Agent’s communication, but no financial award was merited.

Award: Supported – no award. 

22446

A SUITABILITY SAGA – Disability Discrimination Act 1995

The complaint

The Landlords instructed the Agent to find tenants for their property. The Agent was in charge of viewings and began to market the property in the search for tenants.

A potential tenant contacted the Agent to book a viewing around the property. The Tenant was an electric wheelchair user who thought that the property would be suitable for their needs. The Agent accepted the viewing.

After the viewing had taken place the Landlord noticed that the hallway carpets were marked and some of the walls were damaged from the wheelchair. The Landlord believed that the property was not large enough or designed for the purpose of a wheelchair user and so was not happy that the Agent had allowed the potential tenant to view the property.

The Landlord requested that the Agent should pay compensation of £1,427.92 which covered the repairs, time to arrange repairs and lost rental income.

The Agent was not prepared to pay the Landlord’s compensation claim and, instead, offered to cover the cost
of the damage alone (£525.38) rather than their time and lost rental income. The Agent offered this as they acknowledged that they could have done more during the viewing to minimise the damage.

The Landlord was also dissatisfied with the complaints handling from the Agent because responses were not initially issued and that they had been accused of discrimination. These events led to the Tenants making a complaint, stating that the Agent had been unprofessional and that they were dissatisfied with the advice regarding the HMO rules

Investigation

The Landlord was concerned that the viewing should not have taken place as the property was not suitable for a wheelchair user due to its design. The Agent disputed this, explaining that the tenant who viewed the property thought otherwise as he had approached the Agent to rent the property after viewing.

There is a general obligation on those wishing to rent a property to ensure that what they view suits their purpose. In this case, the viewer had disclosed to the Agent that they were a wheelchair user and wished to view the property, which was a bungalow. There was no problem accessing the property, but some staining was caused to the hallway and some damage to corners as the tenant moved around the property. The Agent provided evidence to verify that the viewer wished to progress to let.

The Landlord complained that they were being accused of discrimination however there was no evidence to support the claim. The Agent responded with the supporting information regarding Disability Discrimination Act 1995, which states that agents and landlords cannot discriminate against anyone with a disability who may want to view or rent a property.

Under 8a in the Code of Practice for Residential Letting Agents, Agents are obliged to confirm how viewings should be conducted and, in this case, it was agreed that the Agent would conduct it. Furthermore, under 8b, is states that Agents should provide any feedback from the viewing and the Agent evidenced the notes and contact made with the Landlord the day of the viewing notifying them of the damage.

The Landlord put forward additional costs to the damage for loss of rent and time spent finding new tenants. The Agent was disinstructed after the viewing by the Landlord so it is not known whether a suitable tenant would have been found any sooner by the Agent. In addition, rent is not always guaranteed, and tenants usually must give between one- and two months’ notice before leaving the property. It was not considered that a new tenant could have been found any sooner and therefore the claim for lost rent was deemed unjustifiable cost under the circumstances.

The Landlord also complained about the communication received from the Agent regarding the complaint made. The initial complaint did not receive a response within the allocated time frame stated in the TPO Code.  The Agent waited for the costs to be submitted by the Landlord before responding and therefore there was a small delay. However, once the costs were received the Agent responded within the 15-day time period noted in their complaint procedure.

Outcome

The Landlord’s complaint was partly supported to the extent that the Agents offer of £525.38 was reasonable in the circumstances. A further award of £50 was made in respect of initial complaint handling failures which had exacerbated the situation.

Award: £575.38