Just ahead of the Government’s plans to prevent blanket landlord licensing schemes by local authorities, Croydon rushed through a decision to impose such a scheme at a council meeting on the 16th March 2015.
The licensing scheme effective 1st October 2015 applies to all private landlords in the borough. There is a charge of £750 per property for a 5 year licence, which will be discounted to £350 during an early registration period which commenced 1st July, to encourage landlords to comply.
Landlords renting a property in the Borough without a licence could be liable for a fine of up to £20,000, whilst those breaching a condition of the licence could be fined up to £5,000. The scheme also provides the Council with additional powers including the right to inspect a property.
If only half of properties apply early and benefit from the discounted fee, the scheme will generate over £15m in fees for Croydon Council. This equates to around £3m per year over the next five years. All the money raised will need to be reinvested, as councils are not allowed to profit from licensing schemes.
The council will assess whether the landlord is a “fit and proper person” before deciding whether to grant an application, subject to certain conditions. Croydon justifies its actions because it believes that crime and antisocial behaviour in Croydon is linked to private rented housing because some landlords are failing to take action against problem tenants.
In December 2014, the High Court ruled that Enfield Council’s attempts to introduce selective licensing had been flawed because landlords and agents in neighbouring areas had not been consulted. This result probably encouraged the Croydon Property Forum, a landlord and agent group, to mount a legal challenge to the scheme, arguing that the local authority had failed to take “reasonable steps” to consult developers and landlords over the changes.
But in rejecting the challenge Judge Sir Stephen Silber said he thought there was nothing ‘clearly or radically ‘ wrong with the consultation process.
The Croydon Property Forum, a group of around 1,000 landlords, developers and lettings agents, had argued that the local authority had failed to take “reasonable steps” to consult developers and landlords over the changes. But Clive Sheldon QC, representing the council, said it had made extensive efforts to inform people of the scheme.
The judge ruled that the consultation process had been lawful in his view and refused the application for a judicial review.
Passing judgment Sir Stephen said he found that the council had carried out a lengthy consultation process between September 1, 2014, and March 2, 2015, before making its decision to introduce the scheme.
During the initial consultation stage, background information had been made available on the Council’s website, stating the costs and the Council’s reasoning behind its proposals. A postal survey had been carried out and an information leaflet sent to 9,032 landlords and lettings agents in Croydon. The council had received 754 responses.
As a result of the responses received the Council said the proposed fee had been reduced from £1,000 to £750 over 5 years and it was decided the scheme would cover the whole of the borough, rather than just select areas.
The second stage, accepted by the judge, included a public meeting, posters throughout the borough, emails to children’s centres and residents’ associations, Facebook posts, newspaper advertisements and press releases.
The council’s case was that anyone with an interest in what was happening in Croydon would have known about the proposed licencing arrangement from either of the consultation periods.
As a result, Croydon extended its process to include other boroughs by placing advertisements in newspapers covering Sutton, Merton, Wandsworth, Lewisham, Bromley, Southwark and Surrey, as well as Metro.
Croydon Property Forum was asking for donations and considering an appeal.
Croydon Property Forum: http://www.croydonpropertyforumltd.com
— LandlordZONE® (@LandlordZONE) August 28, 2015