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As landlords, it is imperative to ensure we have adequate education on the different laws and rules that apply to landlords and tenants.
The Deregulation Act 2015 (“the Act”) is an important but misunderstood Act. It is an Act that we, as landlords, and indeed letting agents, must be aware of. Particularly due to its impact on the eviction process, being the subject of this article.
Background
By way of background – in addition to residential property matters – the Act covers an array of other issues to include:
- general and specific areas of business, companies and insolvency
- the use of land, housing, transport, communications, education and training, the environment, entertainment and alcohol, public authorities and the administration of justice.
The Important Bits
This article attempts to demystify Deregulation as an Act. The focus is on practical implications of the Act relating specifically to relevant aspects of residential legislation as it applies to landlords, letting agents and tenants.
The Deregulation Act was the government’s attempt to put into law better safeguards for the tenants. It also provided clarity on landlords’ obligations.
The important bits for landlords relate to:
- The Energy Performance Certificate (EPC)
- Tenancy Deposit Protection
- Prescribed Information
- Section 21 Notice
- Retaliatory Eviction
The Energy Performance Certificate (EPC)
A landlord must ensure tenants have an EPC and a gas safety certificate before the tenancy begins. A landlord may intend on later serving an eviction notice based on section 21. The landlord will then need to make sure that they can evidence both of those documents are in the possession of the tenant.
Tenancy Deposit Protection
Landlords who fail to protect deposits will lose their eviction rights under section 21 no-fault possession ground. Returning the deposit could be a way out—we discuss deposit protection in detail in the next part of this series. Be sure to look out for that.
Tenancy deposit protection provisions in the 2004 Act require that where a deposit is paid – on an assured shorthold tenancy – it must be protected by the landlord or agent in a government-authorised scheme. Certain information (“the prescribed information”) must be sent to the tenant within 30 days of the deposit being received.
Landlords who fail to comply are liable for a financial penalty of between 1 and 3 times the amount of the deposit, payable to the tenant, on the tenant bringing court proceedings.
Additional Prescribed Information
At term commencement, landlords must provide tenants with a copy of the Department for Communities and Local Government’s booklet entitled “How to rent guide”.
Section 21
One of the more critical elements of the Deregulation Act is section 21. It sets out additional restrictions and requirements for landlords to include:-
Timing restrictions on service of a section 21 notice
Landlords cannot validly serve a section 21 notice in the first four months of a tenancy. Renewal tenancies are exempted: where a tenancy has been renewed, a landlord can serve a section 21 notice at any time during the tenure of the tenancy
The lifespan of a section 21 notice
The Deregulation Act provided an expiration period of six months. Meaning, once a Section 21 notice had been served; possession proceedings would need to be started within six months of the date the notice was given. Failure to do this would result in the possession notice becoming invalid.
It is important to note that the lifespan of the section 21 notice changed due to COVID-19 regulations. Where a landlord served/serves a notice after 29 August 2020, the notice will now remain valid for an extended period.
- It will be valid for ten months from the date it is given to the tenants where section 24(D)1 of the Housing Act applies. This provides a ten-month time limit for taking court action.
- It will be valid for four months from the date specified in the notice as the date after which possession is required if section 21(4)E of the Housing Act applies. Any court action must be taken before the expiration of this period.
Retaliatory eviction
Otherwise known as revenge eviction. Retaliatory evictions arise when:
- A tenant makes a complaint about the condition of the property.
- In response, the landlord – instead of carrying out the repairs – serves an eviction notice.
- The tenant’s complaint must be genuine.
- If verified by the local authority inspection, the local authority serves an improvement notice or a notice of emergency remedial Action
In light of the above, and in circumstances where:
- A landlord fails to respond adequately to a tenant’s complaint within 14 days; and
- The tenant then escalates the complaint to environmental health;
- The council serves an improvement notice or emergency remedial action notice (“the Notices”);
A landlord will be prohibited from serving a section 21 notice. The prohibition will last for six months if the council serves either an improvement or emergency remedial action notice. However, if the council takes no action, or only serves a hazard awareness notice, a landlord can still serve a section 21 notice.
The prohibition does not apply in the following scenarios even if the council has served the Notices:
- If the council suspends the improvement notice
- If the property is genuinely on the market for sale to an unconnected party
- If there are mortgage arrears and the lender appoints a receiver
The Deregulation Act provided welcome clarity on protection on deposits and the format of section 21 notices. Retaliatory evictions have been used as a weapon against landlords. Landlords must therefore Act promptly when a tenant complains of disrepair. Just a timely response could save you unnecessary litigation and save you money.
Disclaimer
None of the information in this article is intended to constitute, nor does it constitute, any legal advice or guidance. No warranty, express or implied, about the accuracy or reliability of this information is made. If you have questions, please contact Creative Legals.
