Rent Repayment Order: Rakusen v Jepsen

Rakusen v Jepsen & Others 2023

Judgement was given in this case on the 1^st March 2023 and when it was settled that a Rent Repayment Order could not be made against a superior landlord allowed landlords to breather a sign of relief. This was an appeal about Rent Repayment Orders. These are orders that can be made against landlords that have committed certain housing related offences such as failing to licence a house in multiple occupation. They require a landlord to repay an amount of rent paid by a tenant (or pay to a local housing authority an amount of universal credit paid in respect of rent). The question this case had to decide was whether they can only be made against a tenant’s immediate landlord or whether they can be made against a landlord higher up in a chain of tenancies.

Mr Rakusen is a leaseholder of a flat in London. In May 2016 he granted a short residential tenancy of the flat to a company called Kensington Property Investment Group Ltd (“KPIG”). KPIG subsequently entered into separate agreements with reach of the three Appellant by which they were each granted a right to occupy the room in the flat in exchange for a fee. As a result of his arrangement the flat was required to be licensed as a “house in multiple occupation” under the Housing Act 2004 and a licence from the local authority was required however one was never obtained. In 2019, the Appellants applied for a Rent Repayment Order against Mr Rakusen on the basis that he was said to have committed an offence of being in control or management of an unlicensed HMO contrary to section 72 of the Housing Act 2004. Mr Rakusen opposes the claim and argues that the Appellants could only see an order against their immediate landlord KPIG.

The First Trier Tribunal said it was possible to see a Rent Repayment Order against a superior landlord and the Upper Tribunal dismissed the appeal. However the Court of Appeal reversed the decision and the Appellants appealed to the Supreme Court. The Supreme Court unanimously dismisses the appeal and held that the Rent Repayment Order could not be made against a superior landlord. When arriving at their decision, the Supreme Court took into account the policy behind Rent Repayment Orders and the wider enforcement scheme against rogue landlords.

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Shilpa Mathuradas Partner
Property Litigation

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