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Upper Tribunal cuts £572k civil penalties in housing case by 70%

The Upper Tribunal has allowed in part an appeal over civil penalties of £236,000 imposed on each of two defendants for housing offences, reducing the total amount to be paid to £174,000.

In Sutton & Anor v Norwich City Council (HOUSING - CIVIL PENALTIES) [2020] UKUT 90 (LC) the appellants, Nicholas Sutton and Faith’s Lane Apartments Ltd (FLAL), sought to challenge the penalties imposed on them by Norwich City Council under section 249A, Housing Act 2004.

The penalties related to alleged breaches of the 2004 Act concerning compliance with improvement notices served by the council on FLAL, and breaches of the Licensing and Management of Houses in Multiple Occupation (Additional Provisions)(England) Regulations 2007 (the 2007 Regulations) in respect of Max House, a former office building at 60 St Faiths Lane, Norwich.

FLAL, which went into administration shortly before the appeals were to be heard, owned the freehold of Max House and Mr Sutton was its sole director and majority shareholder.

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The appeals were transferred to the Upper Tribunal for hearing because of the magnitude of the penalties and the number of issues. The appellants listed six “general grounds” of appeal an a further six “additional grounds”, although there was said to be a substantial degree of overlap between them.

Martin Rodger QC, Deputy Chamber President, and Peter McCrea FRICS heard the case and allowed the appeals in part.

They found that the council was entitled to impose financial penalties on both FLAL and Mr Sutton for breaches of five of the 2007 Regulations and for non-compliance with four of the eight improvement notices it had served.  It was not entitled to impose any penalty for the breach of the improvement notice concerning one of the flats. 

The Upper Tribunal reduced the penalties on FLAL to £32,000 for breaches of the 2007 regulations, and £43,000 for non-compliance with the improvement notices.

The Deputy Chamber President and Mr McCrea also reduced the penalties on Mr Sutton to £50,000 for breaches of the 2007 regulations, and £49,000 for non-compliance with the improvement notices.

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