Repair-Shy Landlord Fined Over £35,000 for Dangerous Conditions in Unlicensed HMO

Summary: A landlord with an extensive international property portfolio has been ordered to pay over £35,000 after exposing tenants to hazardous living conditions in an unlicensed House in Multiple Occupation (HMO). The First Tier Property Tribunal found that the landlord’s failure to comply with licensing laws was deliberate, not accidental.

Background and Tribunal Decision

Benjamin Lam, a landlord with a substantial international property portfolio valued at over £50 million, was ordered to pay a Rent Repayment Order of £35,813 to four tenants following a ruling by the First Tier Property Tribunal. The tribunal concluded that Lam’s ignorance of licensing requirements was “not inadvertent but deliberate.”

Lam’s property, located in Hyde Park Mansions on Transept Street, London, was let as an unlicensed HMO. Despite the legal obligation to obtain a licence, Lam admitted the property was let without one, attributing this to an oversight and blaming his agents for failing to inform him of licensing requirements.

However, the tribunal judge criticised Lam for not ensuring that those managing his UK properties were knowledgeable about local laws and regulations. The judge emphasised that with Lam’s considerable resources and experience, he should have been aware of the necessity for compliance.

Poor and Dangerous Living Conditions

Westminster Council conducted an inspection of the property in November 2023, uncovering multiple Category 1 hazards. These included issues with damp and mould growth, excessive cold, and fire safety concerns. Tenants also raised complaints about Lam’s intention to hold their deposits in his personal account rather than in an approved tenancy deposit scheme, only agreeing to comply after tenant insistence.

Lam’s approach to repairs was notably neglectful. When the boiler ceased functioning in March 2023, he instructed tenants to pay for repairs themselves, stating, “This high maintenance cannot go on. This is not a serviced apartment.” He consistently refused to carry out repairs, forcing tenants to undertake some maintenance at their own expense. During a property inspection in August 2023, Lam considered his visit a goodwill gesture rather than a legal obligation.

Implications for Landlords

This case highlights the critical importance of compliance with licensing laws and maintaining safe living conditions in rental properties, particularly HMOs. Landlords must ensure they obtain the necessary licences and address repair issues promptly to avoid legal penalties and protect tenant welfare.

Furthermore, landlords with properties managed by agents should actively oversee compliance and ensure agents are fully informed of legal requirements. Ignorance of the law, especially when managing a large portfolio, is unlikely to be accepted as a defence in tribunal or court proceedings.

Failure to comply with licensing and safety regulations not only risks significant financial penalties but also damages a landlord’s reputation and can lead to increased scrutiny from local authorities.

Conclusion

The substantial penalty imposed on Benjamin Lam serves as a warning to landlords across the UK. Ensuring properties are licensed appropriately and maintained to safe standards is essential. Landlords should regularly review their compliance status and respond swiftly to repair requests to safeguard tenants and avoid costly legal consequences.

Keywords: Rent Repayment Order, unlicensed HMO, landlord licensing, property repairs, tenant safety, Westminster Council, HMO hazards, landlord compliance

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