Civil Penalties Policy

• Housing and Planning Act 2016
• The Smoke and Carbon Monoxide Alarm (England) Regulations 2015 – Financial Penalties

Housing and Planning Act 2016 – Civil Penalties

This statement sets out the principles that Ashford Borough Council (the Council) will apply in exercising its powers to require a relevant landlord to pay a civil penalty.

The Housing & Planning Act 2016 introduced changes to the Housing Act 2004 to allow the Council to issue civil penalties of up to £30,000.  

The Council will be able to impose such penalties as an alternative to prosecution for the following offences under the Housing Act 2004 and Housing and Planning Act 2016:

• Failure to comply with an Improvement Notice (section 30 of the Housing Act 2004);
• Offences in relation to licensing of Houses in Multiple Occupation (section 72 of the Housing Act 2004);
• Offences in relation to licensing of houses under Part 3 of the Act (section 95 of the Housing Act 2004);
• Offences of contravention of an overcrowding notice (section 139 of the Housing Act 2004);
• Failure to comply with management regulations in respect of Houses in Multiple Occupation (section 234 of the Housing Act 2004);
• Breach of a banning order (section 21 of the Housing and Planning Act 2016);
• Failure to comply with a Remedial Notice ( Part 3 of The Electrical Safety Standards in the Private Rented Sector (England) Regulations 2020.

The council will determine, on a case-by-case basis, whether to instigate prosecution proceedings or to serve a civil penalty in respect of any offences listed above.

In addition to the above offences, section 23 of the Housing and Planning Act 2016 provides that a civil penalty may be imposed in respect of a breach of a Banning Order.

Banning orders prohibit landlords and agents from letting or managing residential properties. An order can prohibit a person from:

• Renting out a residential accommodation
• Engaging in letting agency work
• Engaging in property management work.

Guidance on Banning Orders document “Banning orders for landlords and property agents can be found under the Housing and Planning Act 2016” on the government website.

Where a letting/managing agent and landlord have committed the same offence the Council can impose a civil penalty on both of them as an alternative to prosecution. The level of the civil penalty imposed on each offender may differ, depending on the circumstances of the case. The Council cannot prosecute as well as impose a financial penalty, but  must be satisfied, to the criminal standard of proof,  i.e. beyond reasonable doubt, that an offence has been committed, which could justify a prosecution, before it imposes a financial penalty.

Determining whether to prosecute or issue a civil penalty

Where the legislation allows a civil penalty to be issued this will normally be the first choice rather than prosecution unless the landlord has breached housing legislation in the past and continues to be considered such a poor landlord that a banning order is considered necessary. In this case a prosecution will be the first choice with an aim to proceed for a banning order.

When issuing a civil penalty the procedures set out between pages 4 & 6 of this policy in this appendix will be followed in determining the level of the fine.

When determining whether to prosecute for an offence, officers will follow the guidance in this enforcement policy.

The Council has the power to impose a civil penalty of up to £30,000, with a level of civil penalty imposed in each case in line with its policy. The financial penalty will be based on the seriousness of the offence and taking into account the circumstances of the case. This would include the financial circumstances of the offender.

Statutory Guidance

The Government has issued statutory guidance under Schedule 9 of the Housing & Planning Act 2016 Local Authorities must have regard to this guidance in the exercise of their functions in respect of civil penalties.

Paragraph 3.5 of the statutory guidance states that ‘The actual amount levied in any particular case should reflect the severity of the offence, as well as taking account of the landlord’s previous record of offending’. The same paragraph sets out several factors that should be taken into account to ensure that the civil penalty is set at an appropriate level in each case:

1. Severity of the offence. The more serious the offence, the higher the penalty should be.
2. Culpability and track record of the offender. A higher penalty will be appropriate where the offender has a history of failing to comply with their obligations and/or their actions were deliberate and/or they knew, or ought to have known, that they were in breach of their legal responsibilities. Landlords are running a business and should be expected to be aware of their legal obligations.
3. The harm caused to the tenant. This is a very important factor when determining the level of penalty. The greater the harm or the potential for harm (this may be as perceived by the tenant), the higher the amount should be when imposing a civil penalty.
4. Punishment of the offender. A civil penalty should not be regarded as an easy or lesser option compared to prosecution. While the penalty should be proportionate and reflect both the severity of the offence and whether there is a pattern of previous offending, it is important that it is set at a high enough level to help ensure that it has a real economic impact on the offender and demonstrate the consequences of not complying with their responsibilities.
5. Deter the offender from repeating the offence. The ultimate goal is to prevent any further offending and help ensure that the landlord fully complies with all of their legal responsibilities in future. The level of the penalty should therefore be set at a high enough level such that it is likely to deter the offender from repeating the offence.
6. Deter others from committing similar offences. While the fact that someone has received a civil penalty will not be in the public domain, it is possible that other landlords in the local area will become aware through informal channels when someone has received a civil penalty. An important part of deterrence is the realisation that (a) the local authority is proactive in levying civil penalties where the need to do so exists and (b) that the level of civil penalty will be set at a high enough level to both punish the offender and deter repeat offending.
7. Remove any financial benefit the offender may have obtained as a result of committing the offence. The guiding principle here should be to ensure that the offender does not benefit as a result of committing an offence, i.e. it should not be cheaper to offend than to ensure a property is well maintained and properly managed.

Deciding on an appropriate level of penalty

Step 1 – Determining the offence category

The Council will determine the offence category using only the culpability and harm factors in the tables below.  The severity of the offence based on the culpability levels below, would be determined in conjunction with the statutory guidance.

Culpability

Very high

• Where the offender intentionally breached, or flagrantly disregarded, the law or
• Who has a high public profile and knew their actions were unlawful

High

• Actual foresight of, or wilful blindness to, risk of offending but risk nevertheless taken

Medium

• Offence committed through act or omission, which a person exercising reasonable care would not commit

Low

Offence committed with little fault, for example, because:

• significant efforts were made to address the risk although they were inadequate on this occasion
• there was no warning/circumstance indicating a risk
• failings were minor and occurred as an isolated incident

Harm

The table below contains factors relating to both actual harm and risk of harm. Dealing with a risk of harm involves consideration of both the likelihood of harm occurring and the extent of it if it does.

Category 1 – High Likelihood of Harm

• Serious adverse effect(s) on individual(s) and/or having a widespread impact
• High risk of an adverse effect on individual(s) – including where persons are vulnerable

Category 2 – Medium Likelihood of Harm

• Adverse effect on individual(s) (not amounting to Category 1)
• Medium risk of an adverse effect on individual(s) or low risk of serious adverse effect
• The Council and/or legitimate landlords or agents substantially undermined by offender’s activities
• The Council’s work as a regulator to address risks to health is inhibited
• Consumer/tenant misled

Category 3 – Low Likelihood of Harm

• Low risk of an adverse effect on individual(s)
• Public misled but little or no risk of actual adverse effect on individual(s)

We will use the following definition of harm taken from the statutory guidance on hazard rating under the Housing Act 2004, 'Harm is an adverse physical or mental effect on the health of a person'.

Step 2 – Starting point and category range

Having determined the category, the Council would refer to the following starting points to reach an appropriate level of civil penalty within the category range. The Council will then consider further adjustment within the category range for aggravating and mitigating features.

Starting points and ranges – The table below gives the starting points, minimum and maximum financial penalties for each harm category and level of culpability.

Factors, which the Council will consider in reducing the penalty

The Council will consider any factors, which indicate a reduction in the penalty and in so doing will have regard to the following factors relating to the wider impacts of the financial penalty on innocent third parties; such as (but not limited to):

• impact of the financial penalty on offender’s ability to comply with the law or make restitution to victims;
• impact of the financial penalty on employment of staff, service users, customers and local economy.

Reduction for early admission of guilt

The Council will take into account a potential reduction in penalty for an admission of guilt.

The following factors will be considered in setting the level of reduction. When deciding on any reduction in a financial penalty, consideration will be given to:

• The stage in the investigation or thereafter when the offender admitted guilt
• The circumstances in which they admitted guilt
• The degree of co-operation with the investigation

The maximum level of reduction in a penalty for an admission of guilt will be one-third. In some circumstances, there will be a reduced or no level of discount. For example where the evidence of the offence is overwhelming or there is a pattern of criminal behaviour.

Any reduction should not result in a penalty, which is less than the amount of gain from the commission of the offence itself.

Obtaining financial information

The statutory guidance advises that local authorities should use their existing powers to, as far as possible, make an assessment of a landlord’s assets and any income (not just rental income) they receive when determining an appropriate penalty.

In setting a financial penalty, the Council may conclude that the offender is able to pay any financial penalty imposed unless the Council has obtained or the offender has supplied any financial information to the contrary. An offender will be expected to disclose to the Council such data relevant to his financial position to enable the Council to assess what an offender can reasonably afford to pay. Where the Council is not satisfied that it has been given sufficient reliable information, the Council will be entitled to draw reasonable inferences as to the offender’s means from evidence it has received and from all the circumstances of the case, which may include the inference that the offender can pay any financial penalty.

Penalties for Failure to Comply with a Banning Order

The court can impose an unlimited maximum fine for failure to comply with a Banning Order. In addition, the court can also impose a prison sentence.

The Housing and Planning Act 2016 includes provisions and processes for a person to be banned from being involved, for a specified period, in one or more of the following activities:

• Letting housing
• Engaging in letting agency work
• Engaging in property management work

Banning Orders are reserved for what are recognised as being the most serious housing related offences. If the Council was satisfied that a breach of a Banning Order had occurred, the Council would normally start prosecution proceedings. In the event that the Council believed that a civil penalty would be appropriate for a breach of a Banning Order, the council would normally impose a penalty up to a maximum amount of £30,000 to reflect the severity of the offence.

Procedures

Financial Penalty Process and Right for Person to make Representations

Before imposing a financial penalty on a person  the Council will, within 6 months of the date of the offence, give the person notice of its proposal to do so (a “notice of intent”); setting out the Council’s reasons for doing so  and the level of fine. A person in receipt of the notice of intent can make written representations to the following within 28 days:

The Manager

Private Sector Housing

Ashford Borough Council

Civic Centre

Tannery Lane

Ashford

TN23 1PL

Subsequently the Council will decide whether to issue a financial penalty and the amount. Before doing so the Council will issue a final notice requiring that the penalty be paid.

The final notice will set out:

• the amount of the financial penalty
• the reason for imposing the penalty
• information about how to pay the penalty
• the period for payment of the penalty (28 days)
• information about rights of appeal; and
• the consequences of failure to comply with the notice.

The officer determining the level of the financial penalty will record his/her decision, giving reasons for the amount of the penalty.

The landlord has the right to make representations against the decision and the Council will consider any representation. The Council will provide a response within 21 days, with a decision notice stating whether the penalty will be withdrawn, varied or upheld.

A person who receives a final notice may appeal to the First-tier Tribunal against:

• the decision to impose a penalty; or
• the amount of the penalty.

If a person appeals, the final notice is suspended until the appeal is determined or withdrawn.

The Smoke and Carbon Monoxide Alarm (England) Regulations 2015 – Statement of principles for determining financial penalties

Introduction

This statement sets out the principles that Ashford Borough Council (the council) will apply in exercising its powers to require a relevant landlord (landlord) to pay a financial penalty. 

Purpose of statement of principles

The council is required under these regulations to prepare and publish a statement of principles and it must follow this guide when deciding on the amount of a penalty charge.

The council may revise its statement of principles at any time, but where it does so, it must publish a revised statement of principles published at the time when the breach in question occurred. 

The legal framework

The powers come from the Smoke and Carbon Monoxide Alarm (England) Regulations 2015 (the regulations), being a Statutory Instrument (2015 No.1693) which came into force on 1 October 2015.

The regulations place a duty on landlords, which include freeholders or leaseholders who have created a tenancy, lease, licence, sub-lease or sub-licence. The regulations exclude registered providers of social housing.

The duty requires that landlords ensure that:

• a smoke alarm is installed on each storey of premises where there is living accommodation
• a carbon monoxide alarm is installed in any room of premises used as living accommodation, which contains a solid fuel burning appliance

And, for tenancies starting from 1 October 2015:

• that checks are made by the landlord, or someone acting on his behalf, that the alarm(s) is/are in proper working order on the day the tenancy starts

Where the council has reasonable grounds to believe that a landlord is in breach of one or more of the above duties, the council must serve a remedial notice on the landlord. The remedial notice is a notice served under Regulation 5 of these regulations.

If the landlord then fails to take the remedial action specified in the notice within the specified timescale, the council can require a landlord to pay a penalty charge. The power to charge a penalty arises from Regulation 8 of these regulations.

A landlord will not be considered to be in breach of their duty to comply with the remedial notice, if they can demonstrate they have taken all reasonable steps, other than legal proceedings to comply. This can be done by making written representations to the council at the address given at the bottom of this page within 28 days of when the remedial notice is served. 

Ashford Borough Council will impose a penalty charge where it is satisfied, on the balance of probabilities, that the landlord has not complied with the action specified in the remedial notice within the required timescale. 

The purpose of imposing a financial penalty

The primary purpose of the council's exercise of its regulatory powers is to protect the occupants' safety within a dwelling in the event of a fire.

The primary aims of financial penalties will be to:

• ensure landlords take proper responsibility for their properties
• eliminate any financial gain or benefit from non-compliance with the regulations
• be proportionate to the nature of the breach of the regulations and the potential harm outcomes
• aim to deter future non-compliance
• reimburse the costs incurred by the council in undertaking work in default
• lower the risk to tenant's health and safety

Criteria for the imposition of a financial penalty

A failure to comply with the requirements of a remedial notice allows the council to require payment of a penalty charge.

In considering the imposition of a penalty, the authority will look at the evidence concerning the breach of the requirement of the notice. This could be obtained from a property inspection, or from information provided by the tenant or agent that no remedial action had been undertaken. 

For example, landlords can demonstrate compliance with the regulations by supplying dated photographs or alarms, together with installation records or confirmation by the tenant that a system is in proper working order.

Landlords need to take steps to demonstrate that they have met the testing at the start of the tenancy requirements. Examples of how this can be achieved are by tenants signings an inventory form and that they were tested and were in working order at the start of the tenancy. Tenancy agreements can specify the frequency that a tenant should test the alarm to ensure it is in proper working order.

In deciding whether it would be appropriate to impose a penalty, the authority will take full account of the particular facts and circumstances of the breach under consideration.

A financial penalty charge will be considered appropriate if the council is satisfied, on the balance of probabilities that the landlord who had been served with remedial notice under Regulation 5 had failed to take the remedial action specified in the notice within the time period specified. 

Principles for determining the amount of a financial penalty

Any penalty charge should be set at a level which is proportionate to the risk posed by non-compliance with the requirements of the legislation and which will deter non-compliance. It should also cover the costs incurred by the council in administering and implementing the legislation.

Fire and carbon monoxide are two of the 29 hazards prescribed by the Housing Health and Safety Rating System and often result in death and serious injury.

In the case of fire, the absence of working smoke alarms in residential premises is a significant factor in producing worse outcomes.

This is particularly so at night, as without the early warning they provide, a small fire can develop unnoticed rapidly to the stage where smoke and fumes block escape routes or render a sleeping occupant unconscious. Working smoke alarms alert occupiers to a fire at an early stage before it prevents physical escape to safety.

The Department of Communities and Local Government estimate that 231 deaths and 5,860 injuries could be prevented over 10 years accruing a saving of £607.7 million by the provision of smoke alarms.

Carbon monoxide is a colourless, odourless and extremely toxic gas. At high concentrations it can cause unconsciousness and death. At lower concentrations it causes a range of symptoms from headaches, dizziness, weakness, nausea, confusion, and disorientation, to fatigue – all symptoms which are sometimes confused with influenza or depression. For all these reasons, carbon monoxide is often dubbed "the silent killer". Open fires and solid fuel appliances can be significant sources of carbon monoxide. Carbon monoxide alarms alert occupiers to the presence of the gas at an early stage before its effects become serious. 

The Department of Communities and Local Government estimate that six to nine deaths and 306 to 460 injuries could be prevented over ten years accruing a saving of almost £6.8 million by the provision of carbon monoxide alarms.

The provision or smoke detectors and carbon monoxide alarms does not place an excessive burden on a landlord. The cost of the alarms is low and in many cases they can be self-installed without the need for a professional contractor. The impact on occupiers, damage to property and financial costs resulting from a fire or carbon monoxide poisoning event are far and out of proportion to the cost of installing alarms.

For these reasons, an effective incentive to comply with these regulations is fully justified.

It is understood that the imposition of the maximum potential fixed penalty charge, being £5,000 under the regulations, can present an excessive financial burden but this is balanced against the risk. The low cost of compliance and the fact that all reasonable opportunity will have been given to comply prior to any penalty charge being levied. A recipient of a fixed penalty charge has a right of appeal.

For these reasons a penalty charge of £5,000 is set for non-compliance with a Remedial Notice. A reduction of 50% will apply in respect of a person/company who has not previously received a penalty charge under this legislation and payment is received within 14 days of service of the penalty charge notice. There is no reduction for early payment offered to a person/company who has previously received a penalty charge under this legislation.

The council may exercise discretion and reduce the penalty charge if there are extenuating circumstances following a request for a review made by the landlord in writing. 

This discretion will not apply when:

1. The person/company served on has obstructed the authority in carrying out its duties; and/or
2. The person/company has previously received a penalty charge under this legislation

The regulations state that the period for payment of the penalty charge must not be less than 28 days.

The sums received by the council under the penalty charge will offset any remedial works undertaken by the council and the balance may be used by the authority for any of its functions.

Procedural matters

The regulations impose a number of procedural steps which must be taken before the council can impose a requirement on a landlord to pay a penalty charge.

When the council is satisfied that the landlord has failed to comply with the requirements of the remedial notice, all penalty charge notices will be served within six weeks.

Where a review is requested within 29 days from when the penalty charge notice is served, the council will consider any representations made by the landlord. All representations are to be sent to the address at the bottom of this page. The council will notify the landlord of its decision by notice, which will be either to confirm, vary or withdraw the penalty charge notice.

A landlord who has requested a review of a penalty charge notice and has been served with a notice confirming or varying the penalty charge notice, may appeal to the First-Tier Tribunal against the council's decision. Appeals should be made within 28 days from the notice served of the council's decision on review. 

If the penalty charge notice is not paid, then recovery of the penalty charge will be an order of the court and proceedings for recovery will commence after 30 days from the date when the penalty charge notice is served. 

However, in cases where a landlord has requested a review of the penalty charge notice, recovery will not commence until after 29 days from the date of the notice served giving the council's decision to vary or confirm the penalty charge notice. Where landlords do make an appeal to the First-tier Tribunal, recovery will commence after 29 days from when the appeal is finally determined or withdrawn. 

Remedial action taken in default of the landlord

Where a council is satisfied that a landlord has not complied with a specification described in the remedial notice in the required timescale and consent is given by the occupier, the council will arrange for remedial works to be undertaken in default of the landlord. This work in default will be undertaken within 28 days of the council being satisfied of the breach. In these circumstances, battery operated alarms will be installed as a quick and immediate response.

Smoke alarms

In order to comply with these regulations, smoke alarms will be installed at every storey of residential accommodation. This may provide only a temporary solution as the property may be high risk because of:

• its mode of occupancy, such as a house in multiple occupation or building converted into one or more flats;
• having an unsafe internal layout where fire escape routes pass through living rooms or kitchens; or
• the building is three or more storeys high

A full fire risk assessment will subsequently be undertaken, with regards to Leeds City Council Fire Safety Principles and LACORS Housing – Fire Safety Guidance. This will consider the adequacy of the type and coverage of the smoke alarm system, fire escape routes – including escape windows – and fire separation measures, such as fire doors and protected walls and ceilings. 

Any further works required to address serious fire safety hazards in residential property, that are not undertaken through informal agreement, will be enforced using the Housing Act 2004, in accordance with the council's enforcement policy.

Carbon monoxide alarms

In order to comply with these regulations, a carbon monoxide alarm will be installed in every room containing a solid fuel combusting appliance. 

All communications for requests for review or representations made against the Remedial Notice (regulation five) or the Penalty Charge Notice (regulation eight) are to be in writing and sent to:

Julian Watts, Senior EHO, Private Sector Housing, Ashford Borough Council, International House, Dover Place, Ashford TN23 1HU.

Alternatively, you can email the senior environmental health officer.