A case that The Property Ombudsman (TPO) was asked to review came from a tenant against a letting agent in relation to the Energy Performance Certificate (EPC) and the Electrical Installation Condition Report (EICR) for the property.
The property was let to the tenant under an Assured Shorthold Tenancy (AST) for a period of twelve months, for a monthly rent of £3,500. The tenant’s complaint form stated that the EPC gave the property an EPC rating of F, which she says was out of date and the property was actually G at the point it was let.
The tenant stated that an Environmental Health officer surveyed the property and found it to present a severe risk of cold, as there was no heating. She has also complained that she was not given a copy of the EPC or EICR until several months after the start of the tenancy, when she requested copies.
In resolution, the tenant requested an apology and compensation. In response, the letting agent said that they were aware that the property had an EPC rating of F, but believed at the time that it was exempt from energy efficiency requirements on account of being Grade II listed, and that it had been registered accordingly. However, they acknowledged that their understanding of these matters at the time was incorrect.
The tenant was aware that the property was inefficient to heat.
With regard to the provision of the EPC and EICR, the letting agent said that whilst they were instructed to market the property to let and find a tenant, the landlord took direct responsibility for issuing documents at the start of the tenancy. Therefore, the letting agent said it was the landlord who was responsible for matters such as issuing copies of the EPC and EICR. They said that the tenant confirmed that she had had sight of these documents when she signed the agreement.
The Domestic Minimum Energy Efficiency Standard (MEES) Regulations set a minimum energy efficiency level for domestic private rented properties. From 1 April 2018, private landlords were prohibited from entering into new tenancies to let domestic properties with an EPC rating assessment of F or G, unless an exemption applied, and was registered. The legislation sets out specific exemptions which may apply when a property has an energy efficiency rating of F or G. If a property meets the criteria for an exemption, it is possible to legally let it once the exemption has been registered on the National Private Rented Sector (NPRS) Exemptions Register. The above is reflected in the TPO Codes (4f and 6a), which set out agent’s obligations when letting residential property.
The Ombudsman would therefore have expected the letting agent to have established whether the property had a valid EPC, or one commissioned, before marketing the property to let. The Ombudsman checked the EPC register and have found that the most recent EPC certificate for the property was issued on 19 August 2019, and was valid for ten years until 18 August 2029. The letting agent advised that this was the certificate they had sight of when marketing the property to let. It was therefore clear that there was an EPC for the property at the time of the letting.
However, at the assessment in August 2019, the property was given an energy efficiency rating of F. As this was lower than the minimum permissible rating for the letting of a property under the MEES Regulations, the Ombudsman would have expected the letting agent to have checked first whether the property was registered as exempt. The Ombudsman did not consider that it was enough for the letting agent to take the word of the landlord, in-line with their obligations under the TPO Code.
The Ombudsman noted that property was registered for an exemption in October 2022. However, there was no indication that the property was registered as exempt at the point that it was marketed to let in 2021. The letting agent acknowledged that the property was not in fact registered for an exemption in 2021, contrary to their belief at th time.
Failure to verify
The Ombudsman was not satisfied that the letting agent carried out sufficient checks, as had these steps been taken they would have discovered that the property was not exempt. The letting agent should have declined to market the property until an EPC with an energy efficiency rating of E or higher had been obtained, or the property been exempted. This placed the landlord at risk of receiving a penalty notice from the local authority. This part of the complaint was supported.
Regarding the tenant, the agent had an obligation to bring all relevant material information relating to the property to the attention of the tenant, which the Ombudsman was satisfied that the agent did, including the fact that the property only had an EPC rating of F and had electric heating. Therefore, the tenant was aware that the property was inefficient to heat before making any transactional decision, so no compensation was awarded. The Code says:
“13c You must ensure that tenants are provided with relevant and appropriate documentation, statutory or otherwise, prior to their occupation of the property or commencement of the tenancy, whichever is the sooner.”
However, these obligations cover the situation where the agent is responsible for the entire tenancy including set-up and move-in process. The letting agent in this case explained that the landlord wished to carry out the move-in process himself, which was corroborated by the evidence provided. Therefore, this aspect of the complaint was not supported.