Nottingham City Council has won a nationally significant housing case at the Court of Appeal, securing an important legal ruling that strengthens the enforcement of Houses in Multiple Occupation (HMO) licensing laws.
HMO licensing helps ensure shared housing meets essential safety and management standards, and this ruling means more properties will now be covered by those protections.
The case concerned Housing 35 Plus Limited (H35), an accommodation provider operating a number of shared housing properties in Nottingham. The Council’s Safer Housing team investigated H35 for failing to license HMOs, a legal requirement under Part 2 of the Housing Act 2004.
H35 claimed it was exempt from HMO licensing because it is a mutual benefit co-operative society registered with and regulated by the Financial Conduct Authority. Nottingham City Council disputed this interpretation, arguing that the exemption did not apply.
The Council issued two financial penalties of £15,000, which H35 appealed to the First-tier Tribunal. While the initial appeal was upheld, Nottingham City Council successfully challenged the decision at the Upper Tribunal, which found that H35 did not meet the legal conditions required for exemption.
H35 subsequently appealed to the Court of Appeal. The Court dismissed the appeal, agreeing with Nottingham City Council that H35’s rules did not ensure that all management decisions were taken by members at a general meeting, as required by Schedule 14 of the Housing Act 2004.
The ruling confirms that H35’s properties are not exempt from HMO licensing. The case will now return to the First-tier Tribunal to consider the remaining grounds of appeal, including whether there was a reasonable excuse for non-compliance and whether the penalty amounts were appropriate.
Regardless of the outcome of those proceedings, H35 is now required to take steps to license all of its HMOs. Nottingham City Council believes this could involve at least 70 properties across the city.
Councillor Jay Hayes, Executive Member for Housing and Planning at Nottingham City Council, said:
“This is a hugely significant ruling, not just for Nottingham but for councils across the country. The Court of Appeal has provided vital clarity on how the law applies, and it confirms that organisations cannot avoid their responsibilities through technical interpretations that don’t reflect how properties are actually managed.
“This case shows our commitment to standing firm, even when enforcement action is complex and time-consuming. Licensing exists to protect residents and improve housing standards, and we will continue to use all available powers to hold landlords to account.”
The case represents a major success for Nottingham City Council’s work to protect tenants and uphold housing standards.
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