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On 3 March 2020 the Government set out a COVID-19 action plan, which outlined the steps that the Government has taken and future steps that it intends to take depending on how the situation develops. The plan set out the basis of emergency legislation that is being implemented in response to the outbreak. The legislation is planned to be temporary and as it currently stands is to be effective until September 2020.
There is currently a great deal of uncertainty as to the status of Landlord and Tenant litigation. The purpose of this article is to explain the current position in relation to existing and new matters.
HM Courts & Tribunal Service
The day-to-day running of the Courts has been impacted and, as a result, hearings and trials which are due to shortly commence or have already been part heard, are likely to be subject to adjournments or alternative arrangements and the court may decide which types of hearings take precedence over others. Indeed, priority is being given to emergency hearings such as injunctions. Certain County Courts have already postponed all face to face hearings.
It is important to bear in mind that any hearings that are currently listed may be postponed or relisted as telephone hearings where oral evidence isn’t required. If you are concerned about the specific consequences of this, please get in touch.
Possession Proceedings – Residential Tenancies
The emergency legislation that is planned to be implemented by the Government in the next few days will make sweeping changes to residential possession proceedings.
A key change is an extension to the notice period for service of notices on Assured Shorthold tenants. Under the new legislation, the notice periods for section 21 and section 8 of the Housing Act 1988 will be extended to three months. This is subject to change however, and the legislation provides for the possibility that this period could be extended further.
In practical terms, this simply adds more time between serving a notice and issuing possession proceedings, particularly in the case of Section 8 Notices, for example for non-payment of rent or breach of a term of the tenancy. Notices can still be served on tenants throughout this period, provided that the appropriate notice period is given.
The Courts are still dealing with ongoing possession claims; however, this may change. A spokesperson for the Ministry of Housing has stated that:
“As soon as legislation is passed, no new possession proceedings will begin – in either the social sector or the private rented sector – for at least the next 3 months. We have the power to extend this notice period if necessary,”
While the current form of the emergency legislation does not deal with issuing proceedings, it is safe to assume that the Courts will follow suit and this will have an impact on new possession claims, even those that arise from notices served prior to the outbreak. This change may not necessarily be in legislation, but instead may be a result of Court practices. Housing Minister Robert Jerrick has tweeted:
“The very clear guidance that we have given to judges and bailiffs also means that it is extremely unlikely that any possession proceedings will continue during this period. If there is evidence that this is not the case, we will of course review.”
In cases where possession proceedings are currently ongoing, there has been little to no guidance, and hopefully more information will become available in the coming weeks. However, it is likely that the Courts will be reluctant to make possession orders that will result in an eviction during the outbreak.
We have liaised with the bailiff’s office, and been told that all current warrants for possession have been postponed until the end of April. In the event that the situation does not improve in the next few weeks, it is likely that this will be extended.
The aggregate result of the above is that it will likely not be possible to obtain possession of a residential property let under an Assured Shorthold Tenancy while the coronavirus crisis is ongoing, regardless of the stage of the proceedings.
It is important to note that this does not mean that tenants are not still liable to pay rent – they are still obliged to do so. A landlord can also still serve a notice in anticipation of the end of the crisis.
The latest measures by the Government demonstrate increased protection for businesses by incorporating a ban on evictions for commercial tenants in most business tenancies. Landlords will not be able to enforce ‘a right of re-entry or forfeiture by action or otherwise as a result of rent arrears during the relevant period’ from the date of passing of the act until 30 June 2020 or such later date as is considered necessary (‘the Relevant Period’). The Government has encouraged parties to have conversations to reach voluntary arrangements about rental payments that are due, as businesses may be struggling with cashflow issues. This does not mean that tenants will not be liable for rent during the Relevant Period and rental payments should still be made where possible.
It is also important to note that the rules on waiving the right to forfeiture during this period have been relaxed, and it is impossible to waive this right in relation to payment of rent until 30 June 2020.
The Bill also makes a provision in respect of proceedings which have already commenced. Where a landlord has commenced proceedings to forfeit a lease on basis of rent arrears, a possession order cannot be made that provides for the lease to be forfeited before the end of the Relevant Period.
These changes will likely have a large impact on both landlords and tenants, and it is clear at this stage that the usual procedures will not apply for the duration of the crisis. As it stands, it cannot be known how long this situation will persist, or what further measures may be implemented as a reaction to the crisis. As the situation is changing from day to day, it is important that you keep up to date on developments to ensure that you do not fall afoul of the new measures.
This is a general summary of the law as at the date of this article. It should not replace legal advice tailored to your specific circumstances. If you wish to discuss the implications of this matter further please contact us on 020 7224 0025 or by email at email@example.com or firstname.lastname@example.org.
This article is for information purposes only and is not legal advice. It should not be acted or relied upon and legal advice should be sought before applying any of the information in this article to any facts or circumstances.