C1Part 2Regulation of Social Housing
Chapter 7Enforcement powers
Suspension and removal of officers F1of non-profit registered providers
Words in cross-heading before s. 259 inserted (1.4.2010) by The Housing and Regeneration Act 2008 (Registration of Local Authorities) Order 2010 (S.I. 2010/844), art. 1(2), Sch. 1 para. 73
I1259Suspension during inquiry
1
The regulator may make an order under this section if—
a
an inquiry under section 206 is in progress in respect of a non-profit registered provider, and
b
either of the following cases applies.
2
Case 1 applies if the regulator has reasonable grounds for believing—
a
that the affairs of the registered provider have been mismanaged, and
b
that the interests of tenants of the registered provider, or its assets, require protection.
3
Case 2 applies if as a result of an inquirer's interim report under section 207 the regulator is satisfied that the affairs of the registered provider have been mismanaged.
4
The regulator may by order suspend any officer, employee or agent of the registered provider who it thinks has contributed to the failure or mismanagement.
5
The regulator may suspend an officer, employee or agent of a registered charity only if the charity has received public assistance.
6
An order ceases to have effect at the end of the period of 6 months beginning with the day on which the inquirer's final report under section 207 is made.
7
But the regulator may revoke an order before the end of that period.
8
The regulator shall notify the Charity Commission if it suspends an officer, employee or agent of a registered charity.
I2260Removal or suspension following inquiry
1
This section applies if as a result of an inquiry under section 206 or an audit under section 210 the regulator is satisfied that the affairs of a non-profit registered provider have been mismanaged.
2
The regulator may by order remove any officer, employee or agent of the registered provider who it thinks has contributed to the failure or mismanagement.
3
Pending a decision whether to remove an officer, employee or agent, the regulator may by order suspend the person for a specified period of up to 6 months.
4
The regulator may remove or suspend an officer, employee or agent of a registered charity only if the charity has received public assistance.
5
Before making an order the regulator must take all reasonable steps to give at least 14 days' notice to—
a
the person, and
b
the registered provider.
6
The regulator shall notify the Charity Commission if it removes or suspends an officer, employee or agent of a registered charity.
I3261Suspension under section 259 or 260: supplemental
1
This section applies where the regulator suspends an officer, employee or agent of a registered provider under section 259 or 260.
2
The regulator may give directions to the registered provider about—
a
the performance of the suspended person's functions, and
b
any other matter arising from the suspension.
3
The regulator may appoint a person to perform the suspended person's functions.
I4262Disqualification of removed person
1
A person is disqualified from acting as an officer of a registered provider if the person has been removed under—
a
section 260, or
b
paragraph 24(2)(a) of Schedule 1 to the Housing Act 1996 (c. 52), section 30(1)(a) of the Housing Associations Act 1985 (c. 69) or section 20(1)(a) of the Housing Act 1974 (c. 44) (other similar provisions).
2
The regulator may waive a disqualification either generally or in relation to a particular registered provider or class of registered providers.
3
A waiver may be granted only on an application by the disqualified person.
4
The regulator shall notify a person whose disqualification is waived.
5
If a disqualified person acts as an officer of a registered provider, the person's acts are not invalid by reason only of the disqualification.
I5263Register of disqualified persons
1
The regulator shall maintain a register of persons disqualified under section 262.
2
The register must show details of any waivers.
3
The regulator shall make the register available for inspection by the public.
I6264Acting while disqualified: offence
1
It is an offence for a person to act as an officer of a registered provider in respect of which the person is disqualified under section 262.
2
A person guilty of an offence is liable—
a
on summary conviction, to imprisonment for a term not exceeding 12 months or a fine not exceeding the statutory maximum or both;
b
on conviction on indictment, to imprisonment for a term not exceeding two years or a fine or both.
3
Proceedings for an offence may be brought only by or with the consent of—
a
the regulator, or
b
the Director of Public Prosecutions.
4
In relation to an offence committed before F52 May 2022 the reference in subsection (2)(a) to 12 months shall have effect as if it were a reference to 6 months.
I7265Acting while disqualified: other consequences
1
This section applies where the regulator is satisfied that a person—
a
has acted as an officer of a registered provider in respect of which the person is disqualified under section 262, and
b
in doing so, has received payments or other benefits from the registered provider.
2
The regulator may require the person to repay the sum or, as the case may be, a specified amount representing the whole or part of the value of the benefit.
3
If a person fails to comply with a requirement the registered provider may recover the sum or specified amount as a debt.
I8266Removal of officers
1
The regulator may by order remove an officer of a non-profit registered provider if a Case listed in this section applies to the officer.
2
Case 1 applies to a person who has been F3made bankrupt.
3
Case 2 applies to a person who has made an arrangement with creditors.
4
Case 3 applies to a person who is subject to a disqualification order or a disqualification undertaking under the Company Directors Disqualification Act 1986 (c. 46) or equivalent legislation in Northern Ireland.
5
Case 4 applies to a person who is subject to an order under section 429(2) of the Insolvency Act 1986 (c. 45) (disabilities on revocation of county court administration order).
6
Case 5 applies to a person who is disqualified under F2section 178 of the Charities Act 2011 from being a charity trustee.
7
Case 6 applies to a person who is incapable of acting by reason of mental disorder.
8
Case 7 applies to a person who is impeding the proper management of the registered provider by reason of absence or failure to act.
I9267Section 266: supplemental
1
Before making an order under section 266 in respect of an officer the regulator must take all reasonable steps to give at least 14 days' notice to—
a
the officer, and
b
the registered provider.
2
An order may be made in respect of an officer of a registered charity only if the charity has received public assistance.
I10268Appeal against removal or suspension
A person removed or suspended under section 259, 260 or 266 may appeal to the High Court.
I11269Appointment of new officers
1
The regulator may by order appoint a person as an officer of a non-profit registered provider—
a
to replace an officer removed by order under section 266,
b
where there are no officers, or
c
if the regulator thinks an additional officer is necessary F4to ensure that the registered provider's affairs are managed in accordance with legal requirements (imposed by or under an Act or otherwise).
2
The regulator may appoint more than a minority of the officers of a registered provider only if—
a
the provider has fewer officers than required by its constitution, or
b
its constitution does not specify a minimum number of officers.
3
Subsection (1) overrides any restriction on eligibility or numbers of officers imposed by the body's constitution.
4
An order appointing an officer shall specify the period for which, and the terms on which, the office is to be held; but—
a
on expiry the regulator may by order renew the appointment, and
b
the officer may resign or retire in accordance with the registered provider's constitution.
5
An officer appointed by order has the same rights, powers and obligations as an officer appointed under the registered provider's constitution.
6
The regulator may exercise the power in subsection (1) in respect of a registered charity only if—
a
a condition in section 274 is satisfied, and
b
the regulator has consulted the Charity Commission.
Pt. 2 modified (1.4.2012) by Localism Act 2011 (c. 20), s. 240(2), Sch. 16 para. 69(2); S.I. 2012/628, art. 6(i) (with arts. 911141517)