Interim Management Orders (Housing Act 2004 Sections 102 – 112)
What is an Interim Management Order ?
These are used to enable a Local Authority to step in and manage a property in place of landlords (or landlord’s management agents).
An IMO transfers the management of a residential property to the Local Housing Authority (LHA) for a period of up to twelve months. The circumstances in which an order can be made are discussed below.
In particular the IMO allows the LHA: Possession of the house against the immediate landlord, and subject to existing rights to occupy;
- To do anything in relation to the house, which could have been done by the landlord, including repairs, collecting rents etc.;
- To spend monies received through rents and other charges for carrying out its responsibility of management, including the administration of the house;
- To create new tenancies (with the consent of the landlord).
An LHA has the power to make an IMO for an HMO (or other property that may have to be licensed under Part 3 of the Housing Act 2004 id there are issues relating to the health, safety, or welfare of persons occupying the property, or neighbours in the vicinity
Financial effect of an IMO
Under the IMO the LHA must pay to the relevant landlord (that is the person(s) who immediately before the order was made was entitled to the rent for the property) any surplus of income over expenditure (and any interest on such sum) accrued during the period in which the IMO is in force.
It must also keep full accounts of income and expenditure in respect of the house and make such accounts available to the relevant person.
If the relevant landlord is dissatisfied with the accounts or the method of payment of surpluses there is right to appeal
When can an IMO must be made in respect of licensable property
An LHA must take enforcement action in respect of a licensable property (which means an HMO subject to Part 2, or other residential property subject to Part 3) by making an Interim Management Order (IMO) if:
- The property ought to be licensed, but is not, and the LHA considers there is no reasonable prospect of it granting a licence in the near future.
An IMO may not, however, be made on this ground if an effective application is outstanding with the authority for the grant of a licence or a temporary exemption notice or if such a notice is in force.
The LHA is satisfied that the Health and Safety Condition is met and, therefore, it would not have granted an application for a licence.
The LHA intends to revoke the licence on one or more of the grounds specified in Parts 2 or 3 of the Act , other than the property has ceased to be licensable, and upon revocation there will be no reasonable prospect of the property being licensed in the near future (e.g. to another suitable person) or
The LHA is satisfied that when the licence is revoked the Health and Safety Condition test will be met.
When an IMO comes into force and notification procedure
Other than on revocation of a licence an IMO takes effect when it is made.
Where an IMO is made on the revocation of a licence then, subject to the right of appeal, it does not take effect until the revocation comes into effect.
If upon revocation of a licence the LHA is satisfied that a new licence will be granted in the near future it may defer making the order.
When an order is made the LHA must serve a notice and copy of it upon the person who would be in control or managing the property (had the order not been made) and other persons with an interest in the property (“the relevant persons”) within seven days of making the order and must also serve the documents in such practical manner as it sees fit upon the occupiers of the property.
The notice must state:
- The reason for making the order and the date on which it is made;
- The general effect of the order;
- The date on which it is proposed the order will cease to have effect.
In addition the notice served upon the relevant persons must advise them of their right of appeal against the IMO.
In order to make an IMO the LHA must apply to the Residential Property Tribunal
Where an IMO is made and comes into force, the LHA must
- Protect the health, safety and welfare of all persons residing the in the property or living in the vicinity
- Consider the granting of a Licence for the HMO or make an F<O
- Set up a management scheme and manage the property
- Ensure the property is insured
One the IMO is in force, the LHA has The Right to possession (subject to the rights of the existing occupiers)
The ability to create occupying licences or leases (such as AST.s)
An IMO should be registered as a local land charge
Appeals against IMOs in respect of licensable properties
Once an IMO is in force a relevant person may appeal to a Residential Property Tribunal (RPT) against the making of the order or its terms. An appeal must normally be made within 28 days of the order being made (although in exceptional cases the tribunal has discretion to extend this period).
When an IMO is made to follow the revocation of a licence a relevant person may appeal to an RPT, normally within 28 days, against the proposed revocation of the licence and/ or the
making and terms of the proposed management order, but the IMO does not come into force until the appeal is disposed of.
In exercising its jurisdiction on appeal the tribunal:
- Must quash the proposed IMO if it satisfied that the licence should not be revoked;
- Must quash the IMO if it is satisfied that a licence should be granted;
- Must quash the IMO or proposed IMO if it is satisfied that property is not licensable under Parts 2 or 3 or that a temporary exemption notice should be granted;
- Must in all other circumstances confirm the IMO or proposed IMO or confirm its making with such variations, as the tribunal considers appropriate. Where the tribunal confirms the making of a proposed IMO, the IMO takes effect on the date of its confirmation (subject to any appeal to the Lands Tribunal).
A relevant person may appeal against the terms, including any variation of those terms which that person had not agreed to, of an IMO at any time whilst it is in force. In relation to such appeals the tribunal’s power is limited to consideration of whether or not to vary the terms of the order in relation to the matter(s) under appeal.
Right to ask for an IMO to be revoked
Any person who (but for the order being in force) would be the person managing or in control of the property or any other person with a relevant interest in it4 may at anytime ask the LHA to revoke the order and
In the case of a property, subject to Part 2 or 3, grant a licence or issue a temporary exemption notice; or
In any other case return the property to the management of the immediate landlord.
If the LHA refuses to revoke the IMO there is a right of appeal against that decision to the RPT.
The tribunal may order that the IMO is not revoked or that it is revoked and a licence issued, or as the case may be, the property is returned to the management of the immediate landlord.
acknowledged as Crown copyright
