AST - failure to contract

[Hooper]

NO, you would have the choice to either:
Get a HMO license, or get your HMO license changed (if the property would then become a licensable HMO); or
Refuse the tenancy to those people, and find some who could legally live there.

That is assuming that changing the property from 4 to 5 people would make the property a licensable HMO. A HMO spread over 2 floors can sleep as many as you like - so long as it isn't in an area that the local authority has decided doesn't need additional licensing.

The basic premise is that if the property is 3 storeys or more AND contains 5 or more unrelated individuals, then it HAS to be licensed. If it doesn't meet these criteria, it MAY still need to be licensed if it is in an area where the local authority have decided additional licensing is required - ie places where a surfeit of HMOs may become a problem.

I am not 100% sure on this - so check it out if it is relevant to you - but I believe the penalty for a non-licensed (licensable) HMO is iro £10k with an additional £1k for any breach of the regulations (mainly safety related) that is found.

If L let a property on an AST to 4 people and T genuinely moved a 5th in without their knowledge, what are the implications for L. Is 'not knowing' a defence, or a mitigation or is culpability the same as for an intentional breach of regulations? This happened to me a few times before the HMO rules came in but was virtually impossible to prove. e.g. one of the Ts would move their partner in, or someone would sleep in the lounge.

(I don't let anything larger than a 2 bed these days!)

[Snorkerz]

so long as it isn't in an area that the local authority has decided doesn't need additional licensing.

For those with eagle eyes - this should obviously read

so long as it isn't in an area that the local authority has decided needs additional licensing.