Rent Repayment Orders
Following some comments on a recent post of Tessa’s on Rent Repayment Orders, I thought it would be a good point to set out for Landlord Law Blog readers exactly how they work.
Other elements that prompt me to do this is the recent case of Mr Z who got caught out when he thought that his agents were applying for a licence, you can read about this here.
Furthermore, the fact that I am doing more and more of these each month, since the advent of the Housing and Planning Act 2016.
What is a Rent Repayment Order?
A Rent Repayment Order (RRO) is a means whereby either rent or housing benefit (HB) can be claimed back from a landlord by either the council or the tenants. If a property has been operating without a license where one is needed, then going back to the Housing Act 2004 the council could claim 12 month’s worth of HB from the landlord.
The tenant could also claim 12 month’s worth of rent but only if the council had prosecuted the landlord first.
Recent changes have come into force
In April the game changed and now a tenant can claim back 12 month’s worth of rent and the council 12 month’s worth of HB where the landlord has:-
- Used violence to secure entry.
- Unlawfully evicted or harassed the occupier.
- Failed to comply with an improvement notice.
- Controlled or managed an unlicensed property.
- Breached any banning order made.
Importantly now, the council does not have to have prosecute for these offences first but any Rent Repayment Order application must be made with a criminal standard of evidence, which in the case of 3,4 & 5 is dead easy to prove, because of the paper trail available.
Who do you apply to?
Rent Repayment Order applications are made to the First Tier Tribunal (FTT), not a court, so the process is much more user-friendly, not to mention faster, so you can see why for many advice and advocacy workers like myself, Rent Repayment Orders are an attractive alternative to a full criminal prosecution, given the inordinate length of time they take and the pathetic fines levied at the end by the criminal judiciary.
A Rent Repayment Order nets the tenant enough money to relocate, possibly avoiding homelessness intervention and provides a suitably punitive sanction on the perpetrator that a criminal prosecution often does not. From the council’s perspective, a Rent Repayment Order allows them to claim back 12 month’s HB which they can keep to use for other enforcement purposes or the promotion and compliance of landlord and tenant law among both landlords and agents.
If the local authority is applying for a Rent Repayment Order they have to first notify the landlord of their intention to do so, giving 28 days for the landlord to cobble together a defence, during which time the landlord has to respond and the council cannot move forward with the application.
However, where the tenant applies for a Rent Repayment Order there is no requirement to put the landlord on notice first, although both council and tenant have to make their application within 12 months of the offence.
There are two forms of Rent Repayment Order
There are two forms currently available, the Rent Repayment Order 2, which is for breaches before 6th April 2018 and the Rent Repayment Order 1, which is for breaches after that date, so as time marches on, the Rent Repayment Order 1 is going to become the standard form used and they are fairly basic, nowhere near as complex as an N5B form that a landlord has to use to apply for accelerated possession.
Section 49 of the Housing and Planning Act gives councils the powers to assist tenants to apply for Rent Repayment Orders (which is where my crew ‘Safer Renting’ come in) and section 48 places a duty on a local authority to consider making a Rent Repayment Order, so things aren’t just left in the wind, government actively encourages the use of them.
Once a Rent Repayment Order is granted
When a Rent Repayment Order is granted by the FTT then any monies awarded can be recovered under county court enforcement procedures, as if the debt was a county court one, so bailiff’s and attachment of earnings are available, as well as registering a charge to force sale of a property.
There are many advantages to Rent Repayment Order’s
I have written elsewhere about the lengthy and bureaucratic procedures involved in any form of rogue landlord enforcement and the lack of staffing and resources in local authorities these days due to austerity and public sector cuts but Rent Repayment Orders are rapidly becoming the secret weapon in the war against rogue landlords.
They are quick, cheap (£100 for the application and a further £100 if there has to be a hearing) the tenant gets something out if it and the rogue landlord gets punished.
If the council do them they get to keep the money for enforcement and don’t have to engage with heavily bureaucratic processes apart from the 28 day warning period.
On the downside, the FTT aren’t exactly consistent with their decisions yet, some discount the landlord’s mortgage payments before calculating the amount of award but even with that it’s a process that works and is becoming increasingly popular among advice and advocacy services.
And they can be easily avoided
As long as the landlord gets themselves properly licensed and avoids the pitfalls of harassment, illegal eviction or ignoring improvement notices then they won’t find themselves subject to an application.
The NLA, RLA and other landlord bodies repeatedly advise that the number of rogue landlords is small by comparison, which is absolutely correct, so most landlords don’t have to worry about Rent Repayment Orders – but for the minority of rogues and the tenants and advice workers out there who need to do Rent Repayment Orders, you now know how they work.