Legal & General's build-to-rent operation reportedly submitted licensing applications for 315 properties in Lewisham 744 days after the council's selective licensing scheme began on 1 July 2024. A council letter dated 10 August 2026, published by the Lewisham Letter, confirmed that at least one application at the Bale & Anchor development was not filed until 15 July 2026. That timeline creates a gap stretching from mid-2024 to mid-2026, during which L&G appears to have been letting properties without valid licences in place.
The case matters because it exposes a fundamental compliance vulnerability: the assumption that delegating licensing to a managing agent automatically protects the landlord. It does not. L&G told Inside Housing Living that Urbanbubble held "delegated responsibility for licensing" and had been "engaging with the council since 2024." Yet Lewisham Council reportedly could not identify applications for the development as recently as 27 March 2026. That 21-month silence between scheme launch and verifiable application raises questions about what "engaging" actually meant and whether L&G maintained any independent oversight of the licensing process.
What the law requires and when protection starts
Lewisham's selective licensing scheme came into force on 1 July 2024. Applications opened on 20 May 2024 with an early-bird discount, so landlords had advance notice and a financial incentive to apply promptly. Under section 95 of the Housing Act 2004, operating without a licence is a criminal offence. The defence is available once a "duly made" application is submitted, meaning the landlord must have filed the application, provided required documents and paid the fee. From that date forward, processing delays are the council's responsibility.
The critical point: the defence does not cover the period before the application was made. If the Bale & Anchor application was submitted on 15 July 2026, the offence ran from 1 July 2024 to 14 July 2026. The landlord has no retrospective protection for that gap, regardless of what the agent may have told them about progress or discussions with the council.
For offences committed wholly before 1 May 2026, tenants can claim up to 12 months' rent via a Rent Repayment Order. For offences committed after that date, the Renters' Rights Act extends the claim period to 24 months. Government guidance suggests that ongoing offences spanning 1 May 2026 are subject to the old rules for the pre-May period and the new rules for the remainder. A tenant who occupied throughout could therefore claim 12 months under the old regime plus the period from 1 May to 14 July 2026. That creates a claimable window of approximately 14.5 months for a continuous tenancy, not the 24 months some headlines imply.
Separately, councils can impose civil penalties of up to £40,000 per property for offences committed after 1 May 2026 under the new enforcement provisions. These are paid to the council, not the tenant, and are discretionary. The maximum is rarely imposed in practice.
The speculative arithmetic
Reports have suggested L&G faces exposure "beyond £15 million". That figure combines two hypothetical calculations. One tenant at Bale & Anchor reportedly pays £1,820 per month. Multiply that by 12 months and approximately 300 properties and you reach £6.55 million. Add a further £9 million by assuming Lewisham imposes the former maximum civil penalty of £30,000 on every property, and the total exceeds £15 million.
None of that has happened. No tribunal has issued a Rent Repayment Order against L&G. No civil penalty notice has been published. The figure assumes every tenant brings a claim, each claim succeeds, the tribunal awards 100 per cent of eligible rent and the council penalises every property at the maximum rate. It also assumes all 315 properties were continuously occupied by paying tenants whose ASTs name the correct L&G entity as landlord.
The Upper Tribunal's decision in Garro provides useful context. That case involved 221 unlicensed HMOs owned by a Unite group entity. Six tenants brought claims. The tribunal awarded 50 per cent of net rent after considering conduct and circumstances, producing total awards of approximately £23,000. The tribunal explicitly noted that professional landlords with substantial portfolios are expected to maintain systems capable of identifying licensing requirements. That precedent suggests two things: awards will be materially below the maximum in most cases, and institutional scale does not lower the compliance standard.
The £15 million figure is not a bill. It is a projection built on assumptions that may not survive contact with tribunal process, occupancy records, reasonable excuse arguments and the tribunal's discretion to reduce awards based on conduct and means.
When delegation is not a defence
L&G's statement that Urbanbubble held "delegated responsibility" reflects a common operational structure in build-to-rent. Managing agents handle day-to-day compliance, and landlords rely on regular reporting and professional competence. That structure is not inherently flawed. The risk lies in treating appointment as protection.
In Aytan v Moore [2022] UKUT 27, the Upper Tribunal set out the test for reasonable excuse based on agent delegation. The landlord must prove the scope of the agent's contractual responsibility, that reliance on the agent was reasonable in the circumstances and why the landlord could not reasonably have kept itself informed. The threshold is not whether an agent was appointed, but whether the landlord maintained any independent oversight.
Garro applied that test to an institutional landlord. The tribunal rejected the reasonable excuse defence and emphasised that large professional operators should have systems in place to track licensing obligations across their portfolios. The judgement did not accept that complexity or portfolio size justified compliance failures. If anything, sophistication raises the bar.
The question for L&G will be what systems it maintained to verify that applications had been submitted. If the answer is periodic assurances from Urbanbubble without documentary proof of submission, payment or acknowledgement, the reasonable excuse defence may struggle. If Lewisham Council genuinely could not identify applications as late as March 2026 despite L&G's claim that Urbanbubble had been "engaging since 2024," the tribunal is likely to ask what that engagement consisted of and why it did not produce a verifiable application until July.
What the numbers do and don't tell us
Developer Watkin Jones confirms that the two L&G blocks at Bale & Anchor contain 322 homes: 138 completed in 2023 and 184 completed in March 2024. Inside Housing Living reports 315 applications pending. That leaves a seven-property gap with no published explanation. The difference could reflect exemptions, non-residential use, vacant units or administrative mismatch. Without clarification, it is impossible to know whether 315 represents the entire exposure or a subset.
Separately, some reports reference 365 homes across the wider Bale & Anchor development. That figure includes a separate block of 43 affordable homes sold to the CBRE UK Affordable Housing Fund in 2023. Those homes are not part of L&G's build-to-rent portfolio and should not be included in exposure calculations.
Equally important: occupancy data is not public. Not all 315 properties were necessarily let throughout the alleged offence period. Some may have been vacant, undergoing snagging or let after July 2024. Rent Repayment Orders are calculated based on rent actually paid during the offence period, so occupancy dates and void periods will materially affect potential awards.
Finally, the identity of the named landlord on each tenancy matters. Rent Repayment Orders are pursued against the immediate landlord as defined in the Housing Act 1988. If different L&G entities appear on different ASTs, claimants will need to identify the correct respondent. Corporate structure is not an academic question when individual tribunal applications are involved.