Court of Appeal rejects appeal by council over improvement notice and whether landlord had “reasonable excuse” for failing to comply

Naila Tabbasam took the case against Manchester City Council, which had sent correspondence to an address at which she was registered but did not reside.

Lord Justice Zacaroli said in his judgment that the question was whether a landlord - served with an improvement notice for a rental property whose address was recorded in the proprietorship register at the Land Registry - has a reasonable excuse for failing to comply with the notice because she did not receive it.

The Court of Appeal was told that Ms Tabbasam owns a property known as Ollier Avenue, which she lets to tenants who in March 2019 complained to Manchester about disrepair.

Council officers found the Ollier Avenue address was also recorded for service on Ms Tabbasam and checked its council tax records, which showed her to be the owner but resident in Barlow Road. She had in fact lived, since 2014, in another street named Kedlestone Avenue.

Manchester sent a number of documents to Ollier Avenue but Ms Tabbasam did not receive them and the tenants did not pass them on.

In July 2020, the council sent a final reminder to Kedlestone Avenue for the overdue payment of the £22,500 penalty, which Ms Tabbasam did receive.

She contacted the council and was sent the improvement notice and the final notice of the financial penalty.

Ms Tabbasam appealed to the FTT which found she had committed an offence under s.30 of the Housing Act 2004 and the fact that she did not know about it did not amount to a reasonable excuse, because this followed her own failure to update her address for service at the Land Registry and her address for council tax purposes. It did though reduce the penalty to £15,000.

She then appealed to the Upper Tribunal, which found she had a defence of reasonable excuse.

Manchester then took the case to the Court of Appeal arguing the Upper Tribunal erred in recognising a reasonable excuse defence founded upon Ms Tabbasam's own default, and that the decision was inconsistent with other defences in which ignorance of the licensing requirement has been consistently rejected as a reasonable excuse.

The council also said the tribunal “placed an impermissible gloss on s.233 of the Local Government Act 1972”, erred in emphasising “exceptionally harsh” consequences for Ms Tabbasam and that the tribunal’s stance on a reasonable excuse defence “creates an unacceptable degree of uncertainty for local authorities”.

Zacaroli LJ said: “It is far from obvious that Ms Tabbasam failed to comply with any obligation as regards the Land Registry.

"Rule 198 of the 2003 Rules requires the registered proprietor of property to provide the registrar with an address for service. More than one address can be provided. There is no requirement that the address must be one at which the registered proprietor resides.

“It is not known whether Ms Tabbasam lived at Ollier Avenue when it was first purchased by her in 2008, or at any point since then. Even if not, I do not regard it as necessarily wrong for her to have identified Ollier Avenue itself as an address for correspondence sent to her. She might reasonably have expected any tenants occupying the property to have forwarded correspondence that was addressed to her.”

It might have been sensible for her to update her correspondence address once the tenants became uncooperative over the claimed disrepair.

But he said: “I do not accept, however…that a landlord who does not do so can be said to be in breach of the requirement under Rule 198 because they must be taken to have accepted the risk that correspondence would not be forwarded on to them.”

Zacaroli LJ said he did not accept Manchester’s core proposition that a landlord who does not keep their address at the Land Registry up-to-date is precluded from relying on the lack of receipt of notice as a reasonable excuse for not complying with the obligation to which the notice related.

He said the Upper Tribunal had been entitled to find that Ms Tabbasam had a reasonable excuse notwithstanding that she could have avoided the risk that the tenants would fail to forward correspondence to her by providing her own home address instead, or as well.

Zacaroli LJ concluded: “There was no error of law in that conclusion, or the judge's related finding that this was at most a technical error that fell short of constituting wrongdoing or negligence.”

Lord Justice Dove and Lady Justice Falk both agreed.

Mark Smulian