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Selective Licensing and Planning

In the recent case of London Borough of Waltham Forest v Khan, the Upper Tribunal held that a local authority can consider the planning status of a property when considering an application for a selective licence.

What is selective licensing (SL)?
Properties that are not subject to HMO licensing could be covered under a SL scheme. Part 3 of the Housing Act 2004 gives local authorities the power to implement SL schemes in designated areas for reasons including, but not limited to, (i) the area is (or is likely to be) an area of low housing demand, (ii) the area is experiencing a significant and persistent problem caused by anti-social behaviour and some or all of the private landlords are failing to take action to combat the problem, (iii) the area contains a high proportion of properties in the private rented sector, (iv) that the area has recently experienced or is experiencing an influx of migration into it, and/or (v) that the area suffers from high levels of crime.

SL is required for houses within the designated area where the whole of the house is occupied either under a single tenancy or licence or under two or more tenancies or licences in respect of different dwellings contained in it.

As of November 2016, SL has been introduced in a number of London boroughs including Barking & Dagenham, Brent, Croydon, Harrow, Newham, Southwark, Tower Hamlets & Waltham Forest.

The Act permits local authorities to grant these licences for a maximum of 5 years, after which they must be renewed.

What is HMO licensing?
There are two additional forms of HMO licensing, mandatory or additional.

Mandatory licensing is required for HMO properties that are:

  • three or more storeys high; and
  • let to five or more persons who form more than one household; and
  • who share an amenity such as kitchen, bathroom or toilet.

Additional licensing is the licensing of other categories of HMO properties such as for example, ‘occupied by 3 or more persons who form more than one household and who share an amenity such as kitchen, bathroom or toilet’. This is up to each local authority.

Facts of the case
Mr Khan had converted a property into a series of flats without planning permission. Consequently, when making a decision on Mr Khan’s SL application Waltham Forest only granted a licence for 1 year as opposed to the maximum of 5 years. The intention behind this decision was to allow Mr Khan a year to make the required planning applications to regularise the planning status of the flats.

Mr Khan appealed to the First Tier Tribunal (FTT) who held that planning was not a relevant consideration for the purposes of SL and changed all the licences to 5-year licences. Waltham Forest appealed to the Upper Tribunal (UT).

The UT took the opposite view to the FTT and held that planning was a relevant consideration. It accepted the view of the FTT that planning was a separate and free-standing system and that breach of planning control could be dealt with entirely through the planning system but, this did not prevent it also being dealt with through property licensing.

The UT reasoned that selective licensing schemes will lead to improvements in areas of low housing demand or anti-social behaviour and it was this fact that Waltham Forest relied on. The UT took the view that converting a property without planning was something which would be likely to contribute to anti-social behaviour and so it fell within the scope of those things that Part 3 licensing was intended to deal with.

The UT also noted that the legislation does not require a local authority to grant a Part 3 licence to a landlord only that they “may” do so. Therefore, a landlord might meet all requirements for a Part 3 licence and still not be granted one.

The UT held therefore that Waltham Forest’s appeal should be allowed and that the licences should continue for just two further months to allow Mr Khan to apply for fresh licences and a new decision made.

Comment
It had been generally assumed that the reasoning adopted by the FTT, that planning was not connected to licensing, was the correct route. Clearly, this was the wrong approach.
This decision is likely to be applicable to HMO licensing schemes as well and will be relevant to Article 4 directions. Article 4 directions allow a local authority to restrict a change of use of a property from a single-family dwelling to a HMO by requiring planning permission to be sought for such a change. This case will substantially increase the ability of local authorities to enforce an Article 4 direction, through the licensing process.

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