"Where landlords fail to meet their legal duties, the council will take action and support residents to challenge it"
- David Joyce - Tower Hamlets Council
A rent repayment order has resulted in five tenants in Bethnal Green being awarded more than £31,000 after a tribunal found their landlord operated an unlicensed HMO over an extended period.
The First-tier Tribunal issued the ruling on 6 March 2026, concluding that Mio Real Estate Ltd breached the Housing Act 2004 by managing a six-bedroom shared flat without the required licence under Tower Hamlets’ additional licensing scheme.
The tribunal directed the company to repay 70% of the rent paid by each tenant, reflecting the seriousness of the offence and the landlord’s conduct. It also ordered the repayment of £777 in tribunal fees.
The case centred on Flat 5, Paris House on Old Bethnal Green Road, where at least six unrelated occupiers lived in a self-contained ground-floor flat and shared facilities over a sustained period.
Tower Hamlets introduced its additional licensing scheme in April 2019, extending requirements to properties with three or more people forming two or more households. Although the landlord accepted that a licence was required, it did not submit an application until September 2024, after the tenants had left and enforcement action had begun.
The tribunal rejected arguments that the company acted solely on behalf of the freeholder. It found Mio Real Estate Ltd was the immediate landlord, having taken on the lease, issued the tenancies and collected rent directly from occupants.
While the tribunal accepted the breach was not deliberate, it concluded this did not constitute a “reasonable excuse”. The judge stated that operators in the lettings market are expected to understand licensing obligations, particularly in boroughs where additional schemes are well established.
When setting the repayment level, the tribunal also considered evidence of poor conduct, including failures to properly protect tenant deposits.
The decision reinforces that responsibility for licensing sits with those controlling and managing occupied properties. This includes landlords and rent-to-rent operators who grant tenancies and receive rent, regardless of how ownership structures are arranged.
For tenants, the outcome underlines the role of a rent repayment order as a route to recover funds where landlords breach legal requirements. These orders allow claims of up to two years’ rent in cases involving offences such as operating an unlicensed HMO.
Tower Hamlets Council supports tenants pursuing rent repayment order claims, helping them prepare cases and navigate the tribunal process. Since introducing this support, the council has helped secure more than £1.3m for renters across mandatory, additional and selective licensing schemes.
Few local authorities offer this level of direct involvement, with many directing tenants to external advice services instead.
The case comes as the government prepares to introduce the Renters’ Rights Act, which aims to strengthen enforcement and improve standards across the private rented sector while giving tenants clearer routes to redress.
"This outcome shows that tenants do not have to accept unsafe or unlawful housing," said David Joyce, corporate director for housing and regeneration.
"Where landlords fail to meet their legal duties, the council will take action and support residents to challenge it. As the sector moves towards stronger renters’ rights, this case sends a clear signal that we will continue to use our enforcement powers to protect tenants and uphold standards in Tower Hamlets."
