N&A Investments UK Limited & Anor v Staffordshire County Council
[2024] UKFTT 984 (GRC)
Property Link (E17) Ltd v The London Borough of Waltham Forest
30 July 2024
[2024] UKFTT 696 (GRC)
First-tier Tribunal
A property company was fined £10,000 for not belonging to a required protection scheme. They appealed saying they couldn't join because their bank wouldn't give them the right account and their director was very ill. The judge reduced the fine to £3,000 because of their problems, but said they should still have tried harder to join the scheme.
Key Facts
- •Property Link (E17) Ltd (Appellant) failed to comply with regulations requiring membership of a Client Money Protection Scheme (CMPS).
- •The London Borough of Waltham Forest (Respondent) issued a Fixed Penalty Notice (FPN) for £10,000.
- •Property Link appealed, citing inability to obtain a client account necessary for CMPS membership due to health issues of the sole director and bank refusal.
- •The appeal was partly allowed, reducing the FPN to £3,000.
Legal Principles
The purpose of the regulations is to protect consumers, and a company's financial state should be considered when assessing penalties.
London Borough of Camden v F Ltd [2017] UKUT 349 (AAC)
Maximum penalties should be reserved for the worst cases.
M & M Europe Ltd v London Borough of Newham [2018] UKUT 271 (AAC)
Guidance on penalty imposition is helpful but not legally binding.
London Borough of Newham v Samson Estates Limited [2019] UKUT 110 (AAC)
Property agents must be a member of an authorised scheme and take all steps to become a member.
Client Money Protection Scheme for Property Agents (Requirement to Belong to a Scheme, etc.) Regulations 2019/386
Outcomes
Appeal partly allowed.
The Tribunal considered aggravating factors (lengthy breach, potential harm to tenants and landlords) and mitigating factors (health issues of the director, cooperation with the investigation, efforts to join a CMPS, financial hardship).
Financial Penalty Notice varied to £3,000.
The original penalty of £10,000 was deemed excessive considering the mitigating circumstances.
Similar Cases
The Right Property Company (Birmingham) Ltd v Dudley Metropolitan Borough Council
[2024] UKFTT 983 (GRC)
KK Rich Estates Limited v London Borough of Newham
[2024] UKFTT 149 (GRC)
David Dawson v Nottingham City Council
[2023] UKFTT 851 (GRC)
Hasan Kazi v Bradford Metropolitan District Council
[2023] UKUT 263 (LC)