according to S.97(9) of the Act
(9) Any amount payable to a local housing authority under a rent repayment order-
(a) does not, when recovered by the authority, constitute an amount of housing benefit recovered by them, and
(b) is, until recovered by them, a legal charge on the house which is a local land charge.
I don’t think you need to do anything apart from stop paying HB from the point at which the L/A close him down (if they do) . I think the point is that there can be no liability once this action is taken.
It is possible that the LA might also have a management order which would mean that they become the L/L for the period in Question and can deduct any costs of upgrades repairs etc from the rent they would collect before passing on any residual profit (if any) to the L/L. In these casesw you would pay the Hb to the LA.
I can’t find the HB regs that cover this stuff but I’m sure there were some amendments somewhere.
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