Having guardians living in a property does not mean it can’t be classed as an HMO, an upper property tribunal has ruled.

Global Guardians Management and Global 100 Ltd appealed against a fine handed out by Hounslow Council and rent repayment orders made by a first-tier property tribunal on the basis that the property – the Stamford Brook Centre – was not an HMO because occupation by guardians meant it did not have sole residential use.

They also argued that Global Guardians Management had not been granted a tenancy of the property by owner NHS Property Services Limited and that Global Guardians and Global 100 did not manage or have control of the property.

However, they failed to convince the judge who found that Global Guardians had exclusive possession and was able to exploit it for its own gain, first by converting the building to residential use and then by licensing up to 30 residential occupiers to live there.

Benefit

“The benefit – which NHSPSL sought – of protecting the property from trespassers and vandalism was secured by means of the occupation of the property by others,” he ruled.

The first tier tribunal had mistakenly found that both Global Guardians and Global 100 were in control and managing the property, said Justice Fancourt but while it could not be concluded that Global Guardians received a rack rent, Global 100 – who certainly did receive a rack rent – was a person in control.

Giles Peaker, at Anthony Gold Solicitors, says Global Guardians were indeed managing the property, although under the Companies Act rather than for the first tier tribunal’s reasons. “But Global 100 weren’t, as neither owner nor lessee of the property,” he explains.

“As a result, both Global Guardians and Global 100 remained liable for the council’s penalty notices, if not on wholly the same grounds as the FTT had held.”

Read the full judgement here: https://www.bailii.org/uk/cases/UKUT/LC/2022/259.html