Margaret Florence Cabo v Karen Tamie Dezotti
Decision date: 2 September 2022
Neutral citation: [2022] UKUT 240 (LC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
This was an appeal by the freehold owner, Ms Cabo, against a First-tier Tribunal rent repayment order relating to a six‑bed HMO managed and let by Top Holdings Ltd under a management agreement. The Upper Tribunal held that Ms Cabo was not a "person having control" under s.263(1) because she did not in fact receive the rack rent, but upheld the FTT's alternative finding that she was a "person managing" under s.263(3)(b) and, on the facts (Top Holdings acting as agent for an undisclosed principal), treated her as the landlord for rent‑repayment purposes. The appeal was dismissed and the RRO for £9,600 was maintained.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: high
The decision establishes (1) that "person having control" under s.263(1) requires actual receipt of rack rent into one's own hands rather than mere entitlement or indirect collection by agents; (2) that s.263(3)(b) can apply where the owner, by virtue of an arrangement through which another receives rents, is effectively the "person managing" the HMO; and (3) an undisclosed principal may be treated as the landlord where an agent contracts in its own name but within its authority, enabling a rent‑repayment order against the principal.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The judgment notes (obiter) that earlier authorities about multiple entitlements to rack rent in chained leases do not govern cases of agency collection, and comments that s.263(3)(b) is broadly framed to catch varied arrangements (including receiverships) and should not be narrowly construed to permit evasion of licensing obligations.