Enforcement Policy - Leasehold Reform (Ground Rent) Act 2022
Issuing a Financial Penalty and/or Recovery Order
Notice of Intent
After determining the level of financial penalty, and/or the need to issue a recovery order, the Council will issue a "Notice of Intent" on the landlord, or relevant person, within the time limits prescribed in the Act.
A Notice of Intent will contain:
- the date on which the notice was served
- the amount of the proposed financial penalty or the terms of the proposed recovery order,
- the reason for imposing the penalty or making the order, and
- information about the right to make representations
A landlord or relevant person who receives a Notice of Intent will have a period of 28 days, beginning with the date on which the Notice of Intent was served, to make written representations about the proposal to issue a financial penalty and/or recovery order and the terms therein. The recipient of the notice will be given instructions on how to provide their written representations in response to the notice.
Review of Financial Penalty and/or Recovery Order
The Council will review any written representations received and consider any factors which indicate a reduction in the penalty, or withdrawal of the notice and/or order, is appropriate.
In so doing, the Council 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):
- The impact of the financial penalty on the Landlord or Agent's ability to comply with the law or make restitution where appropriate
- The impact of the financial penalty on the employment of staff, service users, customers and the local economy.
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 accepted liability
- The circumstances in which they admitted liability
- The degree of co-operation with the investigation
The maximum level of reduction in a penalty for an admission of liability will be one-third. In some circumstances there will be a reduced or no level of discount. This may occur for example where the evidence of the breach is overwhelming or there is a pattern of breaching conduct.
Any reduction should not result in a penalty which is less than the amount of gain from the commission of the breach itself.
The Council may consider amending the terms of any recovery order during this review.
After the end of the 28-day period for written representations, the Council shall decide whether to issue a Final Notice detailing the value of the financial penalty and/or a recovery order. If a recovery order is included within the final notice, the Council can add interest to this payment at the rate prescribed under section 17 of the Judgments Act 1838 (8% per annum) from the day in which the prohibited rent payment was made.
The final notice will require a penalty to be paid to the Council and/or a recovery order to be complied with, before the end of the period of 28 days beginning with the day after that on which the final notice is served.
The final notice will set out:
- the date on which the final notice is served
- the amount of the penalty or the terms of the order
- the reasons for imposing the penalty or making the order
- information about how to pay the penalty or comply with the order
- information about rights of appeal and
- the consequences of failure to comply with the notice
Withdrawal or amendment
The Council may, at any time, withdraw or amend the notice of intent or final notice, including reducing the penalty amount, the penalty or requirement for a recovery order. Where doing so, the Council will write to the person on whom the notice has been served.