Set-Off as a Defence to Rent Arrears: From Lee-Parker to Televantos

Last reviewed: 27 September 2026 — England

General information only. This article describes the law in England as at the date shown above. It is not legal advice and is not a substitute for advice on your case. For free regulated advice, contact a Law Centre, Citizens Advice or Shelter England. The Housing Loss Prevention Advice Service, funded by the Legal Aid Agency, gives free early legal advice to anyone at risk of losing their home from the moment they receive written notice, and on-the-day advice and representation at possession hearings, whatever their income. Find a provider at find-legal-advice.justice.gov.uk.

Why Set-Off Matters in 2026

For a tenant facing a Section 8 possession claim on Ground 8 (three months' rent arrears), set-off is often the single most important defence available. If the property has been in serious disrepair, the tenant's damages claim for breach of the landlord's repairing covenant can be set against the rent. If the set-off brings the arrears below three months on the date of the hearing, Ground 8 disappears as a mandatory ground — and the court has no discretion to grant possession on it.

For the landlord, the picture is the inverse. A pristine rent ledger does not save you from a disrepair counterclaim that has been simmering for two years. The longer you have ignored a tenant's repair complaints, the bigger the set-off they can run when you finally take possession action.

---

The Doctrine in Three Cases

Lee-Parker v Izzet [1971] 1 WLR 1688

The foundational authority. Where a landlord is in breach of a repairing covenant and the tenant carries out the repairs, the tenant can recoup the cost of the repairs from rent. This is not self-help without limits — the tenant has to be able to prove the breach, the cost, and the legitimacy of the deduction.

British Anzani (Felixstowe) Ltd v International Marine Management (UK) Ltd [1980] QB 137

This is the leading authority on the breadth of set-off. Forbes J held that a tenant can set off damages for breach of the landlord's covenant against a rent claim.

Set-off operates as a defence, not merely as a counterclaim. This matters in possession proceedings, where the court is asked whether arrears existed on the date of the hearing. Set-off goes to the figure itself, not just to the relief.

Televantos v McCulloch (1990) 23 HLR 412 (CA)

Set-off was available where the landlord was in breach before proceedings began. The historic chain remains Lee-Parker → British Anzani → Televantos.

---

What Set-Off Actually Requires

A successful set-off has four elements:

1. A breach of the landlord's repairing covenant. Section 11 of the Landlord and Tenant Act 1985 imposes the standard implied covenant. Express covenants in the tenancy agreement may be broader.
2. Notice of the disrepair to the landlord. The duty to repair under Section 11 is generally triggered by notice. The tenant has to be able to show they raised the problem and gave the landlord a reasonable period to fix it.
3. Damages. The tenant can claim general damages (loss of amenity) and special damages (damaged possessions, increased fuel bills, alternative accommodation costs). There is no tariff for general damages (Earle v Charalambous [2006] EWCA Civ 1090 at [17]–[22]); Wallace v Manchester City Council [1998] 3 EGLR 38 is the Court of Appeal decision on the approach.
4. Pleading. The set-off should be raised in the defence (Form N11R). Shelter Legal notes that it is "not necessary to be able to quantify the amount of damages".

---

How Each Side Should Approach It

The Tenant

Run the set-off if the facts are there. Do not run it if they are not.

• Document the disrepair before the claim is issued. Photographs (with date stamps), videos, surveyor reports, Environmental Health reports, GP letters if mould has affected health. Build the file as the disrepair develops, not in the panicked week before the hearing.
• Notify the landlord in writing. A WhatsApp message will do. An email is better. A signed letter sent by recorded delivery is best.
• Keep a written record. The Pre-Action Protocol for Housing Conditions Claims does not cover housing conditions claims which originate as counterclaims or set-offs in possession proceedings (para 3.3), but a clear written letter still creates a documentary record of the issues, the request and the landlord's response.
• Set out what you can. Date of breach, date of notice, period of disrepair and any out-of-pocket costs. Attach the supporting evidence.
• Cross-link to a counterclaim. If the set-off exceeds the rent arrears, the balance becomes a counterclaim. The court can give judgment for the tenant on the counterclaim while dismissing the possession claim.

The Landlord

If you are about to issue a Section 8 claim on Ground 8, audit the property first:

• Get the property surveyed. A surveyor's report on current condition shows where you stand.
• Pull the repair log. Every request the tenant made; every response you gave; every contractor visit. Be honest with yourself about whether any of those requests were ignored or delayed.
• Consider settling. A landlord who pursues a Ground 8 claim against a tenant with a credible set-off can lose the claim and pay damages on the counterclaim. The headline arrears figure can become an actual debt owed to the tenant.

The set-off risk is a compliance risk first. Disrepair that has been reported and not fixed is what gives the tenant a figure to set against the rent, and Awaab's Law will tighten the timescales for private landlords once the Renters' Rights Act 2025 provisions are commenced. ComplyWithMe's guide to Awaab's Law and private landlords sets out what applies now and what is coming, and its exposure check shows where a property stands from a postcode and a few answers.

---

The Bundle Both Sides Will Build

The bundle for a possession claim with a set-off counterclaim is substantially larger than a simple arrears bundle. It will include:

Landlord's evidence:

• Tenancy agreement
• Form 3A
• Rent ledger from start of tenancy
• Bank statements supporting the ledger
• Repair-request log
• Contractor invoices
• Deposit protection paperwork
• Landlord witness statement

Tenant's evidence:

• Dated photographs and videos of disrepair
• Letters notifying the landlord of the disrepair
• Landlord's response (or absence of response)
• Surveyor's report if obtained
• Environmental Health report if obtained
• GP letters or medical evidence if health impact
• Receipts for damaged possessions
• Bills showing increased fuel costs
• Witness statements from family members or visitors
• Schedule of Loss
• Tenant witness statement

BundleCreator's templates for housing-possession-debt include a possession-and-counterclaim bundle index that lists all of the above.

---

How the Numbers Play Out

There is no tariff for general damages (Earle v Charalambous [2006] EWCA Civ 1090 at [17]–[22]); each case turns on its own facts. Where the damages set off, together with any payments, bring the arrears below three months on the date of the hearing, Ground 8 falls away. Grounds 10 and 11 might still be argued by the landlord, but the court then decides whether possession is reasonable.

---

The 2026 Currency Check

The doctrine is unchanged by the Renters' Rights Act 2025. Section 11 of the Landlord and Tenant Act 1985 still applies, as does the Homes (Fitness for Human Habitation) Act 2018.

---

BundleCreator's set-off defence templates for the Housing Possession & Tenant Debt area at /housing-possession-debt include the defence and counterclaim particulars, the Schedule of Loss and the supporting witness statement.

Nothing in this article is legal advice or a substitute for it. The information here describes the law as it stands at the date shown; the law and procedure may change. For free regulated advice, contact Citizens Advice, Shelter England or your local Law Centre. The Housing Loss Prevention Advice Service, funded by the Legal Aid Agency, gives free early legal advice to anyone at risk of losing their home from the moment they receive written notice, and on-the-day advice and representation at possession hearings, whatever their income. Find a provider at find-legal-advice.justice.gov.uk.