Landlords face confusion over new shorthold tenancy agreements
Landlords in the UK may be unwittingly issuing incorrect Section 21 notices, resulting in thousands of pounds being wasted on aborted possession claims and extensive delays in recovering property, it is claimed.
According to legal firm Kirwans confusion has arisen as a result of legislation changes applying to residential Assured Shorthold Tenancy (AST) agreements which began on, or have been renewed, since 01 October 2015.
Danielle Hughes from Kirwans explained that old Section 21 notices, which can still be used in relation to AST agreements made up to 30 September 2015, require a minimum standard of proof from landlords that there is a written AST in place, that the deposit is protected and prescribed information relating to the deposit was served on tenants. Licences are also required for HMOs or in Selective Licensing areas.
However, the new Section 21 notices, which are currently intended for AST agreements made from 01 October 2015 onwards and won’t apply to older AST’s until late 2018, impose several additional obligations on landlords which must be complied with before the eviction notice can be served.
She believes that landlords and letting agents are serving new Section 21 notices on old AST agreements, putting them at greater risk of having their case thrown out of court and pointed out that there are multiple reasons why it is beneficial to serve the old Section 21 forms on AST agreements made prior to 01 October 2015.
‘Section 21 has until recent years been known as the non-fault notice, with the landlord required to provide only basic information for the older form to be valid, while tenants have limited grounds on which to dispute a possession claim,’ said Hughes.
‘The new form sets out strict requirements with which the landlord must comply prior to serving the notice, including providing the tenant with an Energy Performance Certificate (EPC), a Gas Safety Certificate, and the Government’s ‘How to Rent: The Checklist for Renting in England’ booklet,’ she explained.
She also pointed out that the new notice has a shorter validity period compared to the older forms, and can only be relied upon for a limited time after service, meaning that the landlord either has to issue a possession claim within four months or serve a new notice.
‘A failure to adhere to any of these requirements renders a notice invalid, which could see the case being struck out of court, a minimum 12-week delay to the landlord, loss of the court fee of £355, and a possible order to pay the tenant’s legal costs,’ she said.
‘The new notice also provides tenants with grounds for defending the claim on the basis that the eviction was retaliatory and came about only because they had raised concerns over repairs that needed undertaking on the property,’ she added.
It means that if a tenant has reported a repair that needs undertaking to the local authority and an improvement notice has been served, the landlord may be prevented from recovering possession of the property using Section 21 for over six months under the new regulations.
‘Service of the new notice where it is not needed, therefore, puts the landlord at unnecessary risk of this defence being successfully raised by the tenant in court,’ Hughes said.
She is now urging all landlords and agents to take advantage of this crossover period to use the old Section 21 notice where circumstances permit before the regulations come into force across the board.
‘I would urge landlords and agents to seek advice and to carefully consider how they approach Section 21 Notices if their AST pre-dates October 2015,’ she added.
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