So much has changed over the last few months and so quickly. These are confusing and unprecedented times and the rules around landlord and tenant relations have changed dramatically. The Coronavirus Act 2020, for example, has had major impact, new court procedures have been introduced and there have been changes in policy, approach, and culture both within and outside the court system. New measures have been introduced almost daily. To help provide some clarity, we have prepared this brief guide based on questions from our followers, to help you take stock.
Are the courts still open for business during the lockdown?
The courts are still open for business, although court buildings are closed to the public in all but urgent cases. It is still possible to issue new claims online and by post, but there is a large backlog of possession claims following a six-month stay which ended on 20 September 2020.
Evictions are currently restricted until 11 January 2021, with the following exceptions:
- A possession order made in relation to trespassers where CPR rule 55.6 applies;
- A possession order made under section 84A of the Housing Act 1985, being an absolute ground for possession for anti-social behaviour;
- A possession order made under Ground 2 (anti-social behaviour), Ground 2A (convicted of an offence related to a riot) or Ground 5 (the tenancy was granted based on false statements) in Schedule 2 of the Housing Act 1985;
- A possession order made under Ground 7 (the tenancy was inherited in a will), Ground 7A (anti-social behaviour), Ground 14 (criminal activity), Ground 14A (the landlord is a social landlord and there has been domestic violence at the property) or Ground 17 (the tenancy was granted based on false statements) in Schedule 2 the Housing Act 1988;
- A possession order made under case 2 of Schedule 15 of the Rent Act 1977 (anti-socia; behaviour or criminal activity)
- A possession order based on rent arrears where the arrears totalled 9 months’ worth of rent prior to 23 March 2020, and the order has been granted based on Ground 1 in Schedule 2 to the Housing Act 1985; Ground 8, Ground 10 or Ground 11 in Schedule 2 to the Housing Act 1988; or under case 1 of Schedule 15 to the Rent Act 1977
The minimum notice period for s21 notices, s8 notices and notices to quit has been extended, dependent upon what type of notice and the grounds relied upon. Currently, the default notice period is 6 months, with some minor exceptions – so for a s8 notice served based on anti-social behaviour or rent arrears of 6 months, the notice period is 4 weeks.
When serving a s21 notice, it is still necessary to first ensure that you have complied with all the necessary usual statutory requirements – ensuring the property is appropriately licenced (if applicable), the deposit has been protected properly, and that the tenant has been provided with appropriate Energy Performance Certificate, gas safety certificate, and ‘How to Rent’ booklet.
My court case was stayed during lockdown – what do I need to do now?
The stay on residential possession cases ended on 20 September 2020, meaning that landlords are now free to start or re-start court claims.
If your claim was stayed by the court during lockdown, then in order to re-start it you need to file and serve a re-activation notice, which details the impact of coronavirus on the tenants and includes a two-year rental payment history if the claim is based on arrears. Until that is done the claim will remain stayed.
If your case was at an advanced stage and had a hearing date or dates for other deadlines, then you will also need to file a new proposed timetable with the court.
Can I still exercise a break clause?
Break clauses can still be exercised in the usual way prescribed in the tenancy agreement, but as landlord break clauses need to be accompanied by a s21 notice, the new restrictions discussed above will affect the exercise of any break date.
My tenant is in rent arrears. What are my options?
In the current climate, many landlords are offering rent holidays, rent deferrals or rent deductions to help tenants who may have lost their income and to avoid having an empty property post-lockdown. However, landlords rely on rental income, often have buy-to-let mortgages to pay and some tenants who can comfortably afford to pay the rent have chosen to take advantage of the situation.
The traditional option of serving a s8 notice once the rent is 2 months in arrears is now less attractive in the light of the new restrictions but remains a viable option, if a little slower than usual. As discussed above, the default notice period for the majority of cases has been temporarily extended to 6 months, with a large backlog of possession claims and evictions for the courts to process.
Other options if the landlord wishes to pursue payment during lockdown include pursuing a money claim for the arrears or issuing a statutory demand (if the debt it over £5,000), or in the case of a corporate tenant (if the debt is over £750) , threatening a winding up petition, although under the
Corporate Insolvency And Governance Act 2020 statutory demands and winding-up petitions against commercial tenants will continue to be restricted until 31 December 2020.
What are my options if my tenant is unlawfully sub-letting or is causing a nuisance?
This are still grounds for possession under s8 of Housing Act 1988, but the new restrictions do not distinguish between claims based on rent and claims based on other breaches. It is still necessary to serve a 6-month notice. There is however the potentially quicker alternative of applying for an injunction to prevent continuing sub-letting or nuisance, which is not subject to the automatic stay and which could be enforced during lockdown, although we understand that most High Court Enforcement Officers are not currently active.
I need to access the property in order to inspect or to carry out repairs. How can I do that with social distancing in place?
The Ministry of Housing Communities & Local Government released guidance (“Coronavirus (COVD-19): Guidance for Landlords and Tenants”) which states that landlords’ repairing obligations have not changed, but that “in these unprecedented times we encourage tenants and landlords to take pragmatic, common-sense approach to non-urgent issues which are affected by COVID-19 restrictions”. Urgent issues are defined as “those which affect your ability to live safely and maintain your mental and physical health in your home” and gives examples such as a leaking roof, broken boiler, a serious plumbing issue (e.g. no washing or toilet facilities), broken fridge or washing machine, a broken window or door. Both landlords and tenants should still expect each other to attend to urgent matter and tenants should provide access so that urgent repairs can be carried out, although landlords should usually give at least 24 hours’ written notice before accessing a property. If your tenant refuses access to attend to urgent repairs, you will still be able to apply for an injunction. Equally, a tenant is still able to apply for an injunction if the landlord does not attend to urgent repairs.
Social distancing requirements are unlikely to be accepted as an excuse for not attending the property or allowing access were urgent works are required. However only the most urgent cases are likely to be heard promptly by the court. In other cases, it could be a long wait.
Can I evict a lodger?
There is still no requirement to obtain a court order to evict as such occupants are not protected under the Protection from Eviction Act 1977. As such, the automatic stay for court proceedings detailed above will not apply either.
Can I evict trespasser?
Yes, you can. However, a former tenant is not viewed as a trespasser for these purposes. Trespass in residential property remains a criminal offence and the police have powers to enforce.
Is working from home in breach of a tenancy agreement?
Most tenancy agreements prohibit working from home or at least running a business from home. Overnight, that is exactly what millions of UK residents began doing and are still doing weeks later. Few landlords would choose to take issue with this as present, but if the business being run from home is something that might endanger the property, neighbours or void the insurance, that is a different matter. Breach of such a covenant is a discretionary ground in possession claims and few judges would order possession unless there was something extraordinary or inappropriate going on, such as a dangerous or noisy manufacturing process. However it is important that tenants notify their landlords or managing agents that they are working from home or running their businesses from home during the lockdown so that the landlord can notify insurers and mortgage lenders and to ensure that insurance and mortgage conditions are not breached.
My tenant is complaining that my workmen are disturbing him whilst working from home. Can I carry on with the works?
Landlords owe tenants are duty of quiet enjoyment. Works carried out during the day on weekdays are not usually an issue as the tenant will be at work. Suddenly the tenant is always home, so how do you carry out work without disturbing him? These are unchartered waters, but the answer is likely to be that you can still carry out the works if the works are urgent works as described in the government’s guidance discussed above. We recommend that non-urgent works are left until post-lock down.
Does coronavirus render a tenancy agreement void by, for example, frustration?
It is highly unlikely that a tenancy agreement will be rendered void simply because of the lockdown. You should assume that all agreements will remain valid and that the parties need to continue to fulfil their contractual obligations where safe to do so. There are no reported cases in the UK where a lease or tenancy has been held to be frustrated. As a matter of policy, unless there was an appropriate case on unique facts, the courts would be reluctant to make a decision that would ‘open the floodgates’.
Can a tenant be evicted at the moment?
There is now no restriction on landlords beginning the eviction process by serving notices and issuing court proceedings, although most notices will require a 6 month notice period, and the courts have a large backlog of cases to deal with.
I can’t afford to pay my mortgage because my tenant has stopped paying rent. What can I do?
With effect from 20 November, under new FCA guidance borrowers will be entitled to a six-month mortgage payment holiday. If the borrower has already had a shorter deferral period, they can ‘top-up’ up to a maximum of six month. If the borrower has not had any payment holiday to date then they can apply for a maximum of six months. Applications need to be made by 31 March 2020 and run until 31 July 2020. Borrowers who have already had a six-month holiday are not eligible for an extension, although it is important that you speak to your lender if you are in this situation to see how they can assist.
What happens post-lockdown?
This depends on how the government decide to unwind the current restrictions. Without careful planning, the restrictions could be released overnight leading to a surge of notices, possession claims, insolvencies and court hearings. Deferred rental deals will be called in. The global economic impact of the pandemic would suggest that many tenants will be unable to meet their obligations. Landlords will need to balance their commercial needs against their ability to re-let and perhaps take a different approach to tenants who have otherwise been model tenants.
This guide was updated on 18 November 2020. In the current climate, things may have changed by the time you are reading this. Please contact us for the most up-to-date information.