License holders and fit and proper persons
Who can be a licence holder?
The proposed licence holder should be the most appropriate person to hold a licence. This should be the person who is in control of the property for example, the person receiving the rack-rent of the premises. This would normally be the property owner or a manager with full management responsibility. The licence holder must be fit and proper to hold a licence.
A licence can be issued to one or more named person(s), or a limited company. It cannot be issued to a company name that is not a limited company.
There does need to be a connection between the proposed licence holder and the property. If a limited company is proposed as a licence holder, we may require proof that the limited company is involved in the ownership or management of the property.
The licence holder should be located in the UK and ideally within reasonable travelling distance of the property. Alternatively, a local manager can be appointed as the named contact.
All people involved in the management of the property must be fit and proper to hold a licence.
Fit and Proper Person Assessment
The City Council must undertake checks to ensure that the proposed licence holder (and the manager, if different) is a fit and proper person. In deciding whether a person is fit and proper they must take into account:
- Any previous convictions involving fraud or other dishonesty, violence, drugs or specified sexual offences
- Contraventions of housing or landlord and tenant law
- Whether the person has practised unlawful discrimination
- Whether the person has acted otherwise than in accordance with any applicable code of practice approved under section 233
The Council will also consider whether the proposed licence holder has been previously
- Refused an HMO licence
- Issued a reduced term HMO licence
Where the above applies the Council must refuse to grant an HMO licence, unless it can be satisfied that any action can be taken within a reasonable period of time that means the person is no longer regarded as not a fit and proper person.
The local authority must also consider whether any person associated with, or formerly associated with the proposed licence holder/manager, on a personal, work or other basis, has committed any of the above offences. Having obtained this information, the Council must then determine whether that evidence is relevant to the fit and proper person’s status of the proposed licence holder/manager.
The licensing regulations specify the information that the licence applicant and manager must declare on the licence application form with respect to their personal circumstances in relation to the matters listed above. The application form requests this information in the form of questions which the applicant must complete, and declare that it is correct to the best of their knowledge.
To provide false or misleading information is an offence under section 238 of the Housing Act 2004. The licence applicant will also sign the form on behalf of all joint licence holders and the manager, and must ensure that those persons do not have any offences that must be declared.
Where an applicant indicates that one or more issues applies to them, or where other information comes to light, then further information must be disclosed in order for the Council to assess whether this is of relevance to that person’s ability to be regarded as being fit and proper. If it appears that the matter is not of relevance to their status as a fit and proper person, then the application may proceed for approval.
If it is established that the matter is of relevance to their status as a fit and proper person, then the licence must be refused or the licence applicant may nominate another, more suitable, person. Wherever possible, applicants who are assessed as not being fit and proper will be encouraged to propose an alternative person or company, who has no personal connection with the refused person, to act as the licence holder on their behalf.
The HMO Licensing Team will actively work with the initial proposed licence holder to assist in this process wherever possible. The final decision as to whether a person is to be regarded as not being fit and proper will be made by the Service Manager HMO licensing, after consultation with legal services and after considering any representations from the applicant.
Considerations for fit and proper status
When considering whether a person is fit and proper, we will make a decision on the basis of the:
- Severity of any breach of law
- Number of breaches
- Time elapsed since the last breach and their conduct since it occurred
- Relevance of the breach to the management of the HMO and their occupation
- Evidence that the applicant has accepted the need to conduct his or her business in accordance with appropriate standards
- Satisfactory arrangements have been made for the repayment of debts associated with statutory responsibilities
If the council decides that you are not a ‘fit and proper’ person, or the property does not meet the conditions, and there is no reasonable prospect of appointing an alternative licence holder, or bringing the property up to standard within an acceptable time period, we can refuse to issue you a licence for a house in multiple occupation (HMO).
In this situation, the council has a duty to issue an Interim Management Order (IMO). This allows the council to step in and manage the property, including collecting the rent. This order can last for a year or until suitable permanent arrangements can be made. If the IMO expires and there is no likelihood of a positive change in the circumstances, then the council can issue a Final Management Order (FMO). This removes the property from the control of the owner for a period of five years, which can be renewed.
Where the person is determined not to be a fit and proper person, the council will consider the impact of this decision on any other HMO licenses they may hold. Revocation of these licenses is a potential course of action.
Accommodation of vulnerable persons
Where accommodation is to be occupied by vulnerable persons, the applicant will be required to support their declaration by obtaining an enhanced disclosure certificate from the Disclosure and Barring Service (DBS) or Disclosure Scotland. Existing certificates to this or a higher level will be acceptable, provided they are no more than twelve months old. This applies to supported accommodation housing persons:
- With a background of dependency issues
- Mental illness
- On probation
- Those under the age of 18
- Any other persons considered to be vulnerable
The proprietors of Supporting People schemes which fall within the mandatory licensing requirements will need to produce a disclosure certificate in connection with their Supporting People contract. Disclosure certificates are obtainable through the Disclosure and Barring Service or Disclosure Scotland. In certain cases, particularly larger hostel-type premises accommodating persons with drug/alcohol dependency, or persons who are still under supervision by the Probation Service, there may be other agencies who would wish to have their views or concerns taken in to account as part of the licensing process, such as the:
- Probation Service
- Community Safety Team
- Drug Intervention Team
Such concerns may indicate that the proposed licence holder is failing to take reasonable steps to control the behaviour and activities of the occupiers, and this may have an impact upon the local community. As such, the competency of the proposed licence holder or manager may be questioned, even though they may not have declared any outstanding issues and may have a clear DBS Disclosure. The Licensing Team will actively work with all such agencies, and will consider their views as part of the decision-making process in considering the licence application, and whether any specific licence conditions should be identified.