Home Business Services Buy-to-let landlords failing to realise right to legal defence

Buy-to-let landlords failing to realise right to legal defence

Wirral landlords who do not meet strict licensing laws are attending interviews under caution without a solicitor present – and are risking harsh civil penalties and even prosecution as a result, according to a leading solicitor.

David Kirwan, managing partner at Kirwans law firm, said that many landlords don’t realise what is involved when they are invited to an interview under criminal caution (PACE) to discuss their rental property, and are failing to seek legal representation until it’s sometimes too late.

As a result, they can face prosecution and a criminal record, a ban from renting out property or a civil penalty of up to £30,000 for each offence. Sanctions can also include the requirement for the landlord to repay tenants up to 12 months rent for any period during which the property was unregistered.

Mr Kirwan spoke out as it was revealed that Wirral Council has started a consultation on proposals to extend selective licensing in certain parts of the borough.

The council is proposing to re-designate four existing licensing areas due to expire at the end of June 2020; Birkenhead South, Egerton North, Egremont Promenade South and Seacombe Library.

It is also consulting, through questionnaires for both landlords and residents, on extending selective licensing to Egremont South and Tranmere Lairds.

Mr Kirwan said: “A number of landlords have contacted me seeking legal assistance after a PACE interview has taken place, a criminal prosecution has started or penalties have been imposed. Unfortunately, by that point it is sometimes too late to engage with the council and landlords may be left with the options of either appealing to the First Tier Tribunal or to deal with a criminal prosecution in the courts.

“The preferable option, and one which is open to local authorities, is to work with landlords failing to comply, to offer advice and support, educate them about their duties and responsibilities and help to create a reliable pool of landlords instead of imposing swingeing penalties or criminal prosecution

“At a time when the UK is facing a critical rental shortage, council support and education would be of far more benefit to landlords and tenants alike than turning to these overly harsh sanctions.

“Unfortunately, I have not seen a great deal of evidence to suggest that that is happening.”

Mr Kirwan added that the heavy-handed approach taken by some councils was not necessarily appropriate for well-meaning landlords who were still learning the ropes when it comes to renting or others simply daunted by all the bureaucracy.

He said: “While most people agree that rogue landlords operating in the sector should be rooted out and penalised accordingly, councils should be absolutely certain that the punishment fits the crime, and make sure that they are not ‘throwing the baby out with the bath water’.”

Selective licensing legislation was introduced by the Housing Act 2004 in order to tackle the minority of rogue landlords whose poor practices and low-quality rented accommodation negatively affect both their tenants and the areas in which the properties are located.

Each scheme applies to a designated area for a period of five years, and landlords need to apply for a licence for each home affected. They must meet certain licence conditions or risk prosecution, heavy civil penalties and other sanctions as mentioned. Fees are payable on first registration and then again every five years.

However, the enforcement of selective licensing laws by local authorities often fails to distinguish between the minority of landlords who offend and the vast majority who are law-abiding and deliver a good service to their tenants. It is a case, in Mr Kirwan’s opinion, of over-regulation which calls, from time to time, for the ‘light-handed’ approach.

The legislation is also confusing for those operating numerous properties across different boroughs, as each council can create its own set of rules for their own scheme.

Mr Kirwan said: “I would always advise those facing prosecution or penalties to seek legal advice at the earliest possible opportunity. That way, well-intentioned or inexperienced landlords who have simply made a genuine error are given the chance to make proper representations to the council before they impose penalties that could have a long-lasting effect on their ability to rent out their properties.”