The end of Section 21?

18th Apr 2019

On 15th April 2019 the government announced plans to put an end to "no-fault" evictions of tenants under assured shorthold tenancies by repealing section 21 of the Housing Act 1988 (HA 1988). At the same time, it intends to extend section 8 of the HA 1988 to allow a landlord to terminate where it intends to move into the property, or sell it.

Background

Section 21 of the HA 1988 currently enables landlords of residential properties let under Assured Shorthold Tenancies (ASTs) to terminate the tenancy on or after the end of the initial fixed term on two months’ notice without a reason. Provided that landlords have followed the correct procedure and complied with the various pre-requisites before serving the notice, they are entitled to a possession order if the tenants do not leave after the notice has expired.

Landlords can also recover possession by using the procedure set out in section 8 of the HA 1988, but to do so they are required to rely upon and evidence one or more specific “grounds” (such as non-payment of rent or breach by the tenant of any other terms of the tenancy agreement) to entitle them to a possession order. Some of those grounds only give the Court a discretion to grant a possession order. Therefore, the section 21 procedure is the preferred method of many landlords to recover possession of their properties as there is no requirement for them to give any reason.

The section 21 procedure has been criticised by many, including housing charities, for the lack of security that it causes tenants. The purpose of the government’s proposals is to protect tenants from having to make frequent and short notice moves, enabling them to better plan for the future.

Proposal

The government proposes to repeal section 21 of the HA 1988. At the same time, the government proposes to:

• Extend the grounds for termination under section 8 of the HA 1988, to allow a landlord to terminate an AST to move into the property itself, or to sell it with vacant possession.
• Simplify the court processes to make it easier for landlords to gain possession through the courts, where they can make out one of the section 8 grounds.

The effect of these proposals will be that a landlord will always have to provide a reason for terminating an AST.

Once implemented, these proposals will create a major change in the legislative framework governing private residential tenancies. The government intends to carry out a consultation on the details of the new system and to work with the Ministry of Justice and the Courts and Tribunal Service to reform the courts processes for possession.

The effect that the proposals, if implemented, will have on the housing market remains to be seen. Concern has been expressed that the repeal of section 21 will discourage many landlords from entering or remaining in the buy to let market due to fear of being tied into ASTs indefinitely. Furthermore, many tenants do not wish to be tied into long-term tenancies. A possible solution may therefore be a form of “intermediate” tenancy with a term longer than the usual 6 or 12 month term founds in the majority of ASTs. The proposed changes may also mean that landlords might need to review their tenancy agreements, particularly in terms of the parties’ respective obligations, if the tenants are potentially going to be in the property long term.

It is unclear how it is proposed to simplify the court process. Under the current section 21 regime landlords have the option of using what is known as the accelerated procedure where they simply wish to regain possession of the property and do not require a County Court Judgment to be made against the tenant for rent arrears or any other monies owing. This means that, provided that the Judge is satisfied that the correct procedure has been followed and that the notice has been validly served, and the tenant does not defend the proceedings, the possession order is granted on paper without the need for the parties to attend court, which can often involve a wait of several weeks or even months for a hearing date to become available. The accelerated procedure is not available where the landlord wishes to rely upon the section 8 regime.

The government’s latest announcement is the start of a process of engaging with landlords and tenants to amend the grounds for repossessing a property in order to make the process work better for everyone. It will be interesting to see what comes out of those discussions.

Building Trust?

18th Apr 2019

The EDP recently reported on the demise of another building company, who went into liquidation owing more than £100,000. Traditional Renovations went into liquidation leaving customers out of pocket due to unfinished and shoddy workmanship.

It is becoming an all too common problem for builders take payments for construction projects and fail to complete the work.

What can be done to help avoid falling into a similar trap?

• Make sure that you agree in writing with the builder, before the start of the project, the exact works to be completed and at what cost.
• Clarify who you are contracting with – an individual or limited company.
• Agree who is responsible for acquiring the materials, and how they shall be paid for.
• Agree and document a clear timetable for the works to be carried out.
• Agree any extra works or variations in writing.
• Make sure that your agreement is clear regarding payment terms and avoid paying for the full cost of the project “up-front”. Staged payments help control how much you are spending and give you the option of stopping payments if your builder abandons the project part-way through.
• Agree what the parties’ termination rights are, e.g. notice period and circumstances where either party to terminate the agreement.
• Clarify when the final payment for the project becomes due, e.g. is an architect/surveyor to certify the works as being complete?
• It would be prudent to obtain references on your prospective builder, and have credit reference checks carried out.

Contact Peter Hastings at ph@rogers-norton.co.uk

What can be done if you are already a victim, with works uncompleted despite paying the builder?

The Individual Insolvency Register can be searched for free online, it tells you whether a person is subject to a bankruptcy order, debt relief order or individual voluntary arrangement. It will not tell you if an application for any of these has been made. If you find that your builder is already bankrupt you will need to “prove” in the bankruptcy for the amount owing to you. Often a bankrupt will have insufficient assets to cover all of their debts, meaning that you are very unlikely to recover all that you are owed.

If the search comes back clear, you should send a letter before action to your builder, warning them you will issue court proceedings if you are not paid within a set period of time (usually 7 days). If they do not pay then court proceedings can be issued in order to obtain a County Court Judgment, which can then be enforced. The method of enforcement will depend on many circumstances, including the amount owed and the assets of the person who owes you the money.

The experienced Dispute Resolution team at Rogers & Norton has a wealth of experience in dealing with debt recovery matters. We offer a fixed fee service to enable us to review any contracts you may want to sign.

Contact Maria Taylor at mft@rogers-norton.co.uk or Elizabeth Gibson at eg@rogers-norton.co.uk to discuss Debt Recovery or call 01603 675641.

THERE’S NO SUCH THING AS A ‘QUICKIE DIVORCE’…yes even with No-fault

9th Apr 2019

Over the years I have lost count of the number of times I have said those words to clients. No matter what the internet might say, or factory priced on line divorce companies might tell you, there is a set procedure which has to be followed and which means it takes on average 6 months.

Today we heard from Justice Secretary David Gauke that the government will introduce legislation to bring about “no fault” divorce to “end a blaming game” as “soon as parliamentary time allows”. With Brexit taking up most of its time lately we are pleased to hear this. However, an announcement with a tabled bill would be even better given we have been seeking this approval by parliament for some considerable time. In fact, since the Family Law Act 1996 legislation was shelved.

Hopefully, the experts at Resolution and its members like myself will be consulted on how best to draft this bill in the interests of families. It shouldn’t be introduced on political party line whims but with forethought. That way we can avoid the wasted costs and time spent on drafting legislation which has to be re-amended. Much like the Civil Partnership Act 2004 now largely redundant due to the fact those in same sex relationships can now marry but costing millions in government re-drafting and court literature.

Let us hope common sense prevails and the only amendment is to the box you tick on the divorce petition to say you wish to enter either a non-fault divorce ‘by consent’ or ‘without consent’. That the criteria for ‘without consent’ is simply that your partner wishes to record that they did not want to divorce at that point in time. To satisfy those aggrieved at the ending of a marriage.

If you or anyone you know is going through a divorce or separation and they need guidance, support and advice please do not hesitate to contact Kerry Rowell at Rogers and Norton on 01603 666001.

Dementia Proofing Your Home

It may not be the first thing you consider when thinking about home improvements but more and more people are now considering dementia-proofing their home.

Around 850,000 people are currently living with Dementia in Britain and the numbers are going up. One in three people born today will go on to develop dementia, and those with Dementia already account for more than 25% of delayed hospital discharges. The delay in discharging comes after being admitted after a fall or flu, but they are then unable to be safely discharged once better because their homes are not safe or suitable for them to return to.

The Sunday Times recently reported that a team of experts are creating a dementia-friendly home in a refurbished Victorian house to help educate housebuilders, carers and relatives on how to better support those living with dementia.

Features of the test house include:

• Clear lines of sight towards specific rooms
• Good natural lighting, to help people stay alert during the day and sleep better at night
• Automatically controlled ventilation
• Noise-reduction features to reduce stress
• Simple switches and heating controls together with safety sensors in high-risk areas
• A homely and familiar design to encourage relaxation

An open layout that allows clear lines of sight, together with good lighting, contrasting walls and floors and simple-to-use taps and switches are accepted as being vitally important.

There are many things that you can do without serious building work, such as taking out trip hazards and sharp edges. Awareness and eyesight will diminish with dementia, so colours will also dim too. Aim for at least 30% difference in shade between walls and floor – if you can see where the floor finishes and the wall starts, you are less likely to bump into it.

Contrast is important in the bathroom too, if a white toilet has a blue seat, you know exactly where it is, also old fashioned crosshead taps can be less confusing than mixer taps.

The house has big windows, letting in lots of natural daylight, light is crucial to see properly, chairs could look like a crouching intruder to somebody with dementia. Blinds are shut at night to block out street light and for a feeling of security.

Noise can also be a big issue – a person with dementia can zone in on a sound, which then becomes amplified and turns into an obsession. If dementia is spotted early, you can make adaptations and live at home for longer.

We are a Dementia friendly company who continually strive to support people living with the condition. We specialise in helping vulnerable clients and have a wide knowledge and experience in helping people plan for later life.

Should you want to discuss planning for the future or need help and advice on supporting a vulnerable relative you can contact us on 01603 675645 or at wills@rogers-norton.co.uk.

Government Publishes Guidance on the Tenant Fees Act 2019

4th Apr 2019

The Tenant Fees Bill 2017-19 received Royal Assent on 12th February 2019 and became the Tenant Fees Act 2019 (“the Act”). On 1 April 2019, the government published guidance on the impact of this legislation.

The Act restricts the ability of landlords and letting agents to charge certain fees to tenants and prospective tenants of assured shorthold tenancies (excluding social housing and long leases) and student accommodation in England. It imposes a ban on charging any fees to tenants unless those fees are contained within the list of “permitted payments” in the Act. The Act will be introduced in two stages. It will apply to all new tenancies from 1^st June 2019, and then to all tenancies as from 1^st June 2020.

The “permitted payments” under the Act are:

1. a) The rent
2. b) a refundable tenancy deposit capped at no more than five weeks’ rent where the annual rent is less than £50,000, or six weeks’ rent where the total annual rent is £50,000 or above
3. c) A refundable holding deposit (to reserve a property) capped at no more than one week’s rent
4. d) Payments to change the tenancy when requested by the tenant, capped at £50, or reasonable costs incurred if higher
5. e) Payments associated with early termination of the tenancy, when requested by the tenant
6. f) Payments in respect of utilities, communication services, TV licence and council tax; and
7. g) A default fee for late payment of rent and replacement of a lost key/security device, where required under a tenancy agreement

The tenant will not be bound by any term of the tenancy agreement which requires the tenant to make a prohibited payment. Trading Standards will be responsible for enforcing the ban on such payments.

The landlord will be prevented from serving a notice to terminate the tenancy under s. 21 of the Housing Act 1988 until it has paid back to the tenant any banned payments.

A breach of the Act will usually be a civil offence with a financial penalty of up to £5,000, but if a further breach is committed within 5 years of the imposition of a financial penalty or conviction for a previous breach this will be a criminal offence. The penalty for the criminal offence is an unlimited fine.

Where an offence is committed, local authorities have a discretion to impose a financial penalty of up to £30,000 as an alternative to prosecution.

The full guidance can be found at: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/791273/TFA_Guidance_for_LandlordsAgents.pdf