The case of The London Borough of Newham v. Harris ([2017] UKUT 264 (LC)) addresses the discretionary powers of tribunals concerning Rent Repayment Orders (RROs) under the Housing Act 2004. The appellant, the London Borough of Newham, sought to enforce licensing regulations against Mr. John Francis Harris, a landlord who failed to obtain the required property license. The key issue revolved around whether the tribunal had the discretion to refuse an RRO even when the statutory conditions were met.

The Upper Tribunal (Lands Chamber) upheld the decision of the First-tier Tribunal (Property Chamber), which declined to issue an RRO to Mr. Harris despite the fulfillment of mandatory conditions under the Housing Act 2004. The Tribunal reasoned that section 96(5) of the Act grants tribunals discretionary power to make an RRO, allowing them to refuse an order even when statutory criteria are satisfied. The appellant's argument that the Tribunal must issue an RRO when conditions are met was dismissed, reinforcing the Tribunal's discretionary authority.

Precedents Cited

The judgment references several key cases:

• Parker v Waller [2012] UKUT 301: This case did not explicitly address the discretion to make an RRO, focusing instead on other aspects of housing law.
• Tanfern Ltd v Cameron-MacDonald (Practice note) [2000] 1 WLR 1311: Emphasizes appellate courts should defer to lower courts unless there is a clear error of law.
• Piglowska v Piglowska [1999] 1 WLR 1360: Highlights the principle that appellate courts should not substitute their judgment for that of lower courts unless there is an excessive error.

These precedents collectively support the notion that tribunals have a broad scope of discretion and that appellate courts should exercise restraint, intervening only in cases of significant legal misapplication.

Legal Reasoning

The core legal question was whether section 96(5) of the Housing Act 2004 imposes a mandatory obligation on tribunals to issue an RRO when specific conditions are met, or whether it provides discretionary power.

• Appellant's Argument: Claimed that the use of "may" in section 96(5) should be interpreted as "must," thereby removing any discretion from the tribunal to refuse an RRO when statutory criteria are fulfilled.
• Respondent's Argument: Asserted that "may" indicates discretion, allowing tribunals to decide whether to issue an RRO even if all conditions are met.

The Upper Tribunal concluded that "may" confers both jurisdiction and discretion, meaning tribunals can choose whether or not to issue an RRO. The Tribunal further reasoned that mandatory language ("must") was absent, indicating that discretion was intended. Additionally, the specific context of the case, including the settlement between Newham and Mr. Harris, justified the Tribunal's decision to exercise discretion and not issue an RRO.

Impact

This judgment has significant implications for housing law and the enforcement of licensing regulations:

• Affirmation of Discretion: Tribunals retain the authority to decide whether to issue RROs even when applicants meet all statutory requirements.
• Guidance for Future Cases: Landlords and local authorities must recognize that tribunals can consider contextual factors and settle on discretion-based decisions.
• Legislative Interpretation: Clarifies the interpretation of statutory language, emphasizing that non-mandatory terms grant discretion.

Future cases will likely reference this judgment when addressing the scope of tribunal powers under similar legislative frameworks.

Rent Repayment Order (RRO): A legal order requiring landlords to repay housing benefit or rent that was wrongly received by a tenant due to the landlord's failure to meet certain legal obligations, such as obtaining a required property license.

Selective Licensing: A system where local authorities require landlords to obtain a license to rent out properties in certain areas or types of accommodation, aimed at ensuring rental standards and preventing substandard housing.

Discretionary Power: The ability of a tribunal or court to make decisions based on judgment rather than being strictly bound by predefined rules or directives.

Housing Act 2004: UK legislation that, among other things, introduced licensing requirements for landlords and established the framework for RROs to enforce these requirements.

The The London Borough of Newham v. Harris judgment underscores the significant discretionary powers held by tribunals in the context of Rent Repayment Orders under the Housing Act 2004. By affirming that tribunals may choose not to issue an RRO even when statutory conditions are met, the ruling provides clarity on the interpretation of legislative language and the scope of tribunal authority. This decision balances the enforcement of housing regulations with the consideration of individual circumstances, ensuring that legal remedies are applied judiciously.

Key Takeaway: Tribunals possess discretionary authority to issue or decline Rent Repayment Orders under the Housing Act 2004, even when all statutory conditions are satisfied, as affirmed by the Upper Tribunal in The London Borough of Newham v. Harris.