As we find ourselves in the strangest of times both parliament and the courts have taken drastic action to protect tenants and businesses from the fear of eviction during this uncertain time.
This note sets out how the Coronavirus Act 2020 (‘the Act’) affects both business and residential tenancies and is designed to help understand what this means for you as a landlord/tenant.
Business and commercial tenancies
Landlords are unable to evict business tenants on the grounds of non-payment of rent while the Coronavirus emergency continues. This currently applies from 26 March to 30 June 2020 (‘the relevant period’) unless subsequently extended.
1. Forfeiture for non-payment of rent
During the relevant period, the landlord cannot enforce a right of re-entry for non-payment of rent (the definition of rent includes service charge and insurance premium), whether by peaceable re-entry or in court proceedings.
To protect the landlord's position, the right of re-entry can only be waived during the relevant period by an express waiver in writing. Further, where forfeiture proceedings for non-payment of rent are already on foot, the court cannot make an order for possession which expires before the end of the relevant period.
In cases whereby the court has already given possession orders falling within the relevant period subject to payments (e.g. pay the arrears or instalments) by a certain date, the tenant can apply to vary the order to ensure that a default would not result in possession being granted before the end of the relevant period.
The Government has brought in several restrictions in relation to residential possession. Firstly, the Act lengthens the notice period required during the relevant period. For residential tenancies, the ‘relevant period’ set out in the Act is from 26 March to 30 September 2020; unless subsequently extended.
1. Section 8 Notices
Possession proceedings under section 8 of the Housing Act 1988 have always required the service of a notice of intention to bring proceedings for possession.
The minimum period of the notice depended on the particular ground for possession relied on. During the relevant period, all notice periods are extended to three months. The court retains its power to dispense with service of a notice or to abridge the time.
2. Section 21 Notices
The Act extends the minimum notice period under section 21 of the Housing Act 1988 (no fault eviction) from two months to three months.
3. Possession claims suspended
From 27 March 2020 for a period of 90 days (i.e. up to 25 June 2020) there is a suspension of housing possession cases in the Court. This affects new or existing claims, so effectively they cannot be progressed during this period. This is in line with current public health advice to stop all non-essential movement. The Government's strong advice to landlords is not to commence new notices seeking possession during the current time without a ‘very good reason’ for doing so.
4. Maintenance and safety obligations
Landlords should still carry out essential and urgent work to ensure that rented properties are safe. Examples given in the Governmental guidance include testing the fire alarm, roof repairs where there is a leak, boiler and plumbing repairs, broken white goods and security problems. In general, landlords are advised to take a ‘pragmatic, common sense approach’ to resolving issues.
Where COVID-19 restrictions prevent landlords from meeting routine obligations they should not be unfairly penalised. However, the guidance specifically refers to landlords making every effort to abide by existing gas safety and electrical safety regulations.
Landlords must demonstrate that they have taken all reasonable steps to comply with the law. If landlords are not able to engage a contractor or gain access to the property due to COVID-19 restrictions, they should document their attempts and any responses.
The above notes reflect the position as of today. However, this is a changeable situation and the Government has retained the power to alter the notice period required by substituting a period of up to six months, extending the relevant periods as well as extending the suspension period on possession claims within the court.
Please contact a member of our team on 01892 515022 if you would like to discuss this issue further.
This blog is not intended as legal advice that can be relied upon and CooperBurnett does not accept any responsibility for the accuracy of its contents.