A significant number of inquiries regarding private prosecutions arise from individuals who, after approaching the police, find their issues dismissed as non-criminal. This article explores how private prosecutions can offer landlords a means to address the challenges posed by uncooperative tenants.
Failure to pay
Too often, landlords face the distressing situation where tenants, after moving in, either never make a payment or cease payments after an initial few. This issue occurs across various rental arrangements, including long-term and short-term residential leases, commercial properties, and accommodations arranged through homestay platforms such as Airbnb or VRBO.
Despite persistent efforts, landlords often wait weeks, if not months, without receiving any rent. Tenants make promises of forthcoming payments and resist vacating the property, leading to strained communication and potentially drawn-out, costly eviction processes. Police typically classify these matters as civil disputes. Yet, upon detailed examination, such situations may actually constitute an offense of fraud by false representation as outlined in section 2 of the Fraud Act 2006.
Section 2 of the 2006 Act provides (emphasis added):
(1) A person is in breach of this section if he–
(a) dishonestly makes a false representation, and
(b) intends, by making the representation–
(i) to make a gain for himself or another, or
(ii) to cause loss to another or to expose another to a risk of loss.
(2) A representation is false if–
(a) it is untrue or misleading, and
(b) the person making it knows that it is, or might be, untrue or misleading.
(3) “Representation” means any representation as to fact or law, including a representation as to the state of mind of–
(a) the person making the representation, or
(b) any other person.
(4) A representation may be express or implied.
(5) …
The key elements highlighted above, are addressed in detail:
Dishonesty
Following the Supreme Court decision in Ivey v Genting Casinos (UK) Ltd t/a Crockford [2017] UKSC 67, the magistrates’ court or jury now only must consider the following: irrespective of the defendant’s belief about the facts, was his conduct honest or dishonest by the objective standards of ordinary decent people? It is evidently arguable that to make a commitment to pay rent when you have no intention of doing so, or to assure someone that you will pay them when you will not, would be dishonest by such standards.
False Representation
The definition of “false” incorporates the requirement that the person making the representation knows that the representation is, or might be, untrue or misleading. It is the defendant’s actual knowledge that matters, not what they ought to have known, or what a reasonable person would have known. This element of the offence will vary depending on the specific circumstances. It may be possible to show that the tenant never had the ability to pay in the first place, that they did, but chose not to, or that they entered into the tenancy on false pretences (on which more, see below).
Gain/Loss
The concepts of “gain” and “loss” are defined in section 5 of the 2006 Act:
(2) “Gain” and “loss”—
(a) extend only to gain or loss in money or other property.
(b) include any such gain or loss whether temporary or permanent; and “property” means any property whether real or personal (including things in action and other intangible property).
(3) “Gain” includes a gain by keeping what one has, as well as a gain by getting what one does not have.
(4) “Loss” includes a loss by not getting what one might get, as well as a loss by parting with what one has.
Considering the aforementioned criteria, it’s plausible to construct a scenario whereby assurances made by a tenant, that rent will be paid, in order to secure continuation of a tenancy (e.g. to gain accommodation) for no consideration (e.g. at the expense of, or in order to cause loss to, the landlord) can be a false representation. Such cases have successfully been prosecuted in recent years (see for example R v Aldred [2022] EWCA Crim 74).
Relevant considerations when determining if an offense has occurred, include:
- What sort of a lifestyle does the tenant have? Do they have a lot of shopping delivered, or go out a lot? Do they drive an expensive car?
- What is the nature of the reasons for the failure to pay? Do they sound plausible or do they lack credibility?
- What other insights can be gleaned from their social media and open-source research?
False references
When a tenant ceases payment or causes other issues, it’s crucial for landlords to review the documents provided at the start of the tenancy. A case in point is a client of our firm, who, after renting out their property on a short-term basis, was dismayed to learn that the tenant’s reference was falsified. Further investigation revealed that not only was the landlord’s reference a fake, but the employment reference was too—the purported employer had no record of the tenant.
In this situation, there is clear scope for prosecution for offences of either making a false instrument, contrary to section 1 of the Forgery Act 1981 and/or possessing an article for use in fraud, contrary to section 6 of Fraud Act 2006.
Witness statements can be collected from individuals or entities who have been misrepresented by fraudulent references. The court can be petitioned for a witness summons to ensure a witness’s presence or to gather pertinent evidence such as bank statements, which may bolster the case. Criminal prosecution serves dual purposes: it ensures the perpetrator is held accountable and enables claims for compensation for unpaid rent and the costs incurred during the prosecution process.
At Edmonds Marshall McMahon, our specialised investigations team is well-equipped to meticulously review all relevant circumstances, which enables us to assess if the collected evidence indicates fraud.
Carolina Cabral
