The Law Commission

appendix h
RENT TRIBUNALS

part i
LEGISLATIVE BACKGROUND

                  H.1               Rent Tribunals determine a number of matters relating to dwellings that are let under restricted contracts pursuant to the Rent Act 1977 (the “1977 Act”). Rent Tribunals have been in existence for a number of decades, but are currently constituted under section 72 of the Housing Act 1980 (the “1980 Act”). A restricted contract is a contract entered into before 15 January 1989[1] and which falls within section 19 of the 1977 Act.[2]  They are distinct from regulated tenancies[3] and cover contracts where the tenant has exclusive occupancy of part of a dwelling, together with a right to the common use of another part of the dwelling. Because no new restricted contracts have been entered into since 15 January 1989 the volume of cases dealt by Rent Tribunals is decreasing on an annual basis. 

                  H.2               Rent Tribunals were established under section 76 and Schedule 13 to the 1977 Act as sui generis tribunals. Section 72 of the 1980 Act abolished Rent Tribunals so established and reconstituted them as Rent Assessment Committees (in the generic sense, now termed RPTS tribunals) under Schedule 10 to the 1977 Act. When carrying out the functions of the old Rent Tribunals, these Rent Assessment Committees are still known as “Rent Tribunals”.[4] Rent Tribunals, like Leasehold Valuation Tribunals, are therefore a category of rent assessment committee. The procedure of hearings before Rent Tribunals is different to that of Leasehold Valuation Tribunals and is provided for specifically under the Rent Assessment Committees (Rent Tribunal) Regulations 1980.[5]

part ii
substantive jurisdiction

                  H.3               The jurisdiction exercised by Rent Tribunals is, with one exception, referable to the 1977 Act. The jurisdictional review hereunder is concerned with the instances where Rent Tribunals are empowered to adjudicate matters between lessors and lessees that are party to a restricted contract. It should, however, be pointed out that Rent Tribunals also exercise an important administrative function under the 1977 Act. Section 79 obliges the president of every “rent assessment panel”[6] (that is, a Rent Tribunal for the purposes of the 1977 Act) to prepare and maintain a register of the particulars of restricted contracts, the specification of the dwellings to which they relate and the rents as determined by the Rent Tribunal, for the area of the “Rent Assessment Panel” (now RPTS tribunals). This statutory obligation is distinct from the adjudicative jurisdictions listed below. There are three principal legal effects arising from the making an entry into the section 79 register. First, it is an offence to charge a rent in excess of what is entered in the register.[7] Secondly it is an offence to require the payment of a premium on the condition of a grant, renewal, continuance or assignment of rights under a restricted contract.[8] Thirdly, where an authorised officer certifies a copy of an entry in the registry it is receivable as evidence in any court and in any proceedings.[9]

                  H.4               There is a total of seven distinct areas of jurisdiction exercised by Rent Tribunals. Rent Tribunals also exercised jurisdiction under section 80A[10] of the 1977 Act in respect of referrals for raising rents as a result of the introduction of council tax under the Local Government Finance Act 1992. Any referral by a lessor or lessee under that provision had to be made by no later than 31 March 1994.[11] The jurisdiction of Rent Tribunals under section 80A is therefore effectively defunct, and despite it remaining on the statute books, it will not be treated as an area of jurisdiction in this review. The table below summarises the jurisdictional position.

 

Jurisdiction Table

Act	Legislative Provision	Matter	Further Appeal	County Court*
1977 Act	Section 78	Determination of Rent	High Court	A
1977 Act	Section 80(1)	Reconsideration of Rent	High Court	A
1977 Act	Section 81A	Cancellation of Entry	High Court	A
1977 Act	Section 103(2)(a)	Reduction in Notice Period (1)	High Court	A
1977 Act	Section 104(3)	Extension of Notice Period	High Court	A
1977 Act	Section 106(2)	Reduction in Notice Period (2)	High Court	A
1985 Act	Section 389(1)(b)	Compensation for Furniture Possession	High Court	A

 

* A = Rent Tribunal exercises exclusive jurisdiction.

Determination of Rent under Restricted Contract

              H.5               Either the lessor or lessee under a restricted contract may refer the contract to a Rent Tribunal pursuant to section 77(1) of the 1977 Act. Section 78 confers jurisdiction on Rent Tribunals to consider the rents payable under restricted contracts that are referred to it. In particular Rent Tribunals are empowered under section 78(2), having afforded the parties an opportunity to be heard, to (a) approve the rent payable under the contract, (b) reduce or increase rent as it thinks reasonable, or (c) dismiss the reference. Section 78(3) prevents the Rent Tribunal reducing the rent below the level that would be recoverable from a tenant under a regulated tenancy.

Reconsideration of Rent under Restricted Contract

              H.6               Either the lessor or lessee under a restricted contract that is entered in the section 79 register (for instance, its rent has already been considered by a Rent Tribunal), may refer the case, pursuant to section 80(1), to a Rent Tribunal for reconsideration of the rent so entered. Unless the application is made jointly by the lessor and lessee, a Rent Tribunal is not generally required to entertain an application that is made within two years of the last consideration of rent by a Rent Tribunal. It may consider references by one party made within two years if the rent is no longer reasonable because of a change in (a) the condition of the dwelling, (b) the furniture or services provided, (c) the terms of the contract, or (d) any other consideration that was taken into account when the rent was last considered.[12]

Cancellation of Entry

              H.7               Rent Tribunals have jurisdiction under section 81A of the 1977 Act, on application by a party, to cancel the entry of a rent payable in the section 79 registry where the dwelling ceases to be the subject of a restricted contract. When exercising the jurisdiction conferred by section 81A, the chairman of the Rent Tribunal must sit alone.[13]

Reduction in Notice Period of Notice to Quit (1)

              H.8               Section 103(1) holds that, if a restricted contract has been referred to a Rent Tribunal under sections 77 or 80 and a notice to quit the dwelling is served on the lessee before the Rent Tribunal gives its decision or within six months thereafter, the notice will not take effect until the expiry of the six months period.[14] Rent Tribunals have jurisdiction under section 103(2)(a) to direct that a shorter period be substituted for the six months period.

Extension of Notice Period of Notice to Quit

              H.9               The lessee of a dwelling under a restricted contract may apply to a Rent Tribunal, pursuant to section 104(1), for an extension of the notice period to quit, where the restricted contract has been referred to a Rent Tribunal under sections 77 or 80 and the notice period under the contract or section 103 has not expired. Section 104(3) confers jurisdiction on Rent Tribunals to direct that an extension of up to six months on the notice period be granted.[15]

Reduction in Notice Period for Notice to Quit (2)

              H.10               Where the notice period of a notice to quit has been determined or extended under sections 103 or 104, the lessor can apply to a Rent Tribunal for a reduction in that period pursuant to section 106(2). Section 106(2) confers jurisdiction on Rent Tribunals to direct a reduction in the notice period if the lessee has not complied with the terms of the contract, has been a nuisance or has deteriorated the condition of the dwelling or the furniture contained therein.

Determination of Compensation for Possession of Furniture

              H.11               Local authorities have power under section 379 of the Housing Act 1985 (the “1985 Act”) to make a control order in respect of a multiple occupation house where the living conditions of the house are a risk to the safety, welfare or health of persons living in the house. Section 383 also permits the local authority to take control of furniture in the house that the residents have a right to use in consideration of periodical payments to the dispossessed proprietor. A proprietor who is dispossessed because of a control order is entitled to be paid compensation in accordance with section 389 and Schedule 13 to the 1985 Act. In particular he is entitled to be compensated in respect of the period during which the local authority took possession of furniture pursuant to section 383. If the parties cannot agree on the amount of compensation in respect of the furniture the relevant Rent Tribunal has jurisdiction under section 389(1)(b) to determine the matter.

              H.12               The validity of jurisdiction exercised by Rent Tribunals under section 389(1) is circumspect. It is derived from section 81(3) of the Housing Act 1964 (as amended). Section 81(3) conferred a similar jurisdiction on Rent Tribunals constituted under section 76 of the 1977 Act.[16] When Rent Tribunals were reconstituted by virtue of section 72 of the 1980 Act, the section 81(3) jurisdiction would have automatically transferred to the new Rent Tribunals. Section 72 of the 1980 Act states that the functions exercised by Rent Tribunals under the 1977 Act are conferred on rent assessment committees, which when constituted to carry out functions so conferred shall be known as Rent Tribunals. Section 81(3) was repealed by Schedule 1 to the Housing (Consequential Provisions) Act 1985 and the jurisdiction of Rent Tribunals thereunder would have then ceased.

              H.13               The manner in which jurisdiction is “re–conferred” on Rent Tribunals by section 389 would seem not to conform to the establishment provisions of section 72. Section 72 only transferred functions that were exercised by old Rent Tribunals under the 1977 Act (which would have included section 81(3) jurisdiction). Furthermore section 72(3) states that “A rent assessment committee shall, when constituted to carry out functions so conferred, be known as a rent tribunal”. The words “so conferred” imply that only when exercising functions transferred under the 1977 Act, will a rent assessment committee be known as a “rent tribunal”. Clearly the functions exercisable under section 389 of the 1985 Act are not conferred by the 1977 Act. To have given effect to the section 389 jurisdiction the 1985 Act would need to have specifically designated Rent Tribunals as constituted under section 72 of the 1980 Act and Schedule 10 to the 1977 Act as being responsible for exercising jurisdiction conferred on Rent Tribunals. There is no such provision in the 1985 Act, therefore there is reason to doubt the validity of the jurisdiction purportedly conferred on Rent Tribunals by section 389 of the 1985 Act.

part iii
Territorial Jurisdiction

              H.14               Rent Tribunals are a category of rent assessment committee, therefore the nature and extent of their territorial composition is identical to Leasehold Valuation Tribunals.[17] Comments regarding the transfer of jurisdiction to the National Assembly for Wales apply equally, i.e. the substantive jurisdiction of Rent Tribunals is not affected by the devolution of powers to Wales because all jurisdiction exercised by Rent Tribunals is directly referable to primary legislation. The name of individual Rent Tribunals is determined by the geographical area of RPTS Tribunals, for example the London Rent Tribunal.

part iv
Relationship with County Courts and further appeals

Rent Tribunals and the County Courts

              H.15               There is a close relationship between Rent Tribunals and the County Courts. The jurisdiction of Rent Tribunals runs in tandem with that of country courts, however there is no sharing per se of jurisdiction that is expressly conferred on Rent Tribunals. Three sections of the 1977 Act need to be considered.

              H.16               First, as a preliminary matter, a Rent Tribunal has a duty to determine whether it has jurisdiction to entertain a matter that is submitted to it. It is also entitled to determine a collateral issue on which its jurisdiction depends.[18] However, the County Court provides an alternative forum for determining whether a particular contract is within Rent Tribunals’ jurisdiction. Section 141(1)(d) of the 1977 Act specifically confers jurisdiction on County Courts to determine whether Part V (restricted contracts) and sections 103 to 106 apply to a contract. Section 141 only grants power to the County Court to determine whether a Rent Tribunal has jurisdiction; it does not confer jurisdiction on the County Court to determine matters that are within the Rent Tribunal’s jurisdiction. Where an application is made pursuant to section 141(d) and the County Court decides that a Rent Tribunal has jurisdiction, it refers the matter to the Rent Tribunal for its deliberation.

              H.17               Secondly, one needs to consider the jurisdiction of the County Court when a restricted contract is referred to a Rent Tribunal and the contract relates to a dwelling consisting or comprising part only of a hereditament and no apportionment of the rateable value has been made. Section 25 of the 1977 Act grants exclusive jurisdiction to the County Court to determine matters relating to the apportionment of rateable values. Section 82 provides that where a contract is referred to the Rent Tribunal and no apportionment has been made the lessor can require that the apportionment be made and bring proceedings within two weeks to the country court for the making of the apportionment. If the lessor does not refer the matter to the County Court, the Rent Tribunal can deal with the reference if it appears to it that had the apportionment been made, it would have had jurisdiction. Section 82 does not grant jurisdiction to the Rent Tribunal to apportion rateable values, but rather enables it to proceed as if no apportionment of rateable values had been made, though it must defer to the country count when required by the lessor.

              H.18               Thirdly, section 106(4) confers a similar jurisdiction on County Courts to that exercised by Rent Tribunals under section 106(2).[19]  In a case where (a) a notice to quit has been served, (b) the period of that notice has been extended by virtue of sections 103 or 104, (c) the lessor institutes proceedings in the County Court for recovery of possession and (d) and the County Court is satisfied that one of the paragraphs of (a) to (d) of section 106(2) apply, it may direct that the notice period be reduced. The jurisdiction exercised by Rent Tribunals under section 106(2) and County Courts under 106(4) is nonetheless distinct. The section 106(2) jurisdiction can be exercised independent of any other cause of action, whereas the section 106(4) jurisdiction only accrues when recovery of possession proceedings is instituted. This review therefore takes the position that they are not an instance of shared jurisdiction, even though they are closely analogous.

Further Appeals

              H.19               Any party to proceedings before a Rent Tribunal who is dissatisfied in point of law with a decision of the Rent Tribunal may, pursuant to section 11(1) of the Tribunals and Inquiries Act 1992 (the “1992 Act”), either appeal to the High Court or require that the Rent Tribunal state a case for the opinion of the High Court. Schedule 1 to the 1992 Act lists all tribunals whose decisions may be appealed to the High Court. Paragraph 37 thereof refers to rent assessment committees constituted in accordance with Schedule 10 to the 1977 Act.

              H.20               The appeal route from Rent Tribunals therefore differs from Leasehold Valuation Tribunals, whose decisions may be appealed to the Lands Tribunal.