New Government proposals will force landlords to take additional steps before being able to evict tenants in arrears of rent.
The Ministry of Housing is forging ahead with a proposal to “professionalise” the sector by imposing pre-action protocols for private landlords aimed at weeding out so-called part-time landlords and bringing the private rental market into line with the social housing sector. Ministers are accelerating their plans intending to head off an anticipated rush on possession claims once the Covid-19 inspired moratorium on evictions ends on the 23 August. The Government is looking to encourage Landlords and Tenants to actively engage in resolution efforts to make facing each other in court an absolute last resort.
Aim of the Protocol
The protocol aims to assist the parties to resolve issues through pre-action communication and exchange of information, to settle where possible and ultimately to avoid a lengthy and costly litigation process. This will also enable court time to be used more effectively if proceedings are ultimately necessary.
In anticipation of the current stay on possession proceedings being lifted, the government is working with the Master of the Rolls to widen the protocol to require private landlords to contact tenants to understand their financial position before taking possession action.
What Landlords will be required to do:
They will need to consider the following:
• whether the tenant has difficulties in reading or understanding the information given;
• if reasonable steps need to be taken to ensure the tenant understands the information and that it has been appropriately communicated;
• if the tenant is vulnerable;
• if the tenant has the mental capacity to defend possession proceedings; and
• any issues under the Equality Act 2010.
Rent Arrears: Landlord Steps before issuing possession proceedings
Private landlords will need to consider the following steps:
• Contact the tenant as soon as reasonably possible to discuss the reason for the arrears; the tenant’s financial circumstances; the tenant’s entitlement to benefits; and repayment of the arrears.
• Try to agree on an affordable repayment schedule for the tenant to pay towards the arrears, based upon the tenant’s income and expenditure. Rent arrears may well be part of a general debt problem and so, the landlord should advise the tenant to seek assistance from citizens advice bureaux, debt advice agencies or other appropriate agencies as soon as possible.
• The landlord should, upon request, provide the tenant with copies of rent statements from the date that the arrears first arose showing:
all amounts of rent due;
the dates and amounts of all payments made; and
a running total of the arrears.
• Apply for arrears to be paid by the Department for Work and Pensions [‘DWP’] by deductions from the tenant’s benefit, providing the tenant meets the appropriate criteria.
• Offer to assist the tenant in any claim that the tenant may have for housing benefit, discretionary housing payments or universal credit (housing element).
Landlords need to be aware that possession proceedings for rent arrears should not be commenced if a tenant can demonstrate that it has already made a claim for housing benefit (or is likely to be entitled to it). The landlord and the tenant should work together to resolve any housing benefit problems.
After Serving an Eviction Notice
Further specified steps must be taken to try and reach an agreement with the tenant before commencing proceedings.
The Landlord should make reasonable attempts to:
• contact the tenant before the issue of proceedings to discuss the amount of the arrears;
• understand the cause of the arrears;
• agree to the repayment of the arrears; and
• understand the housing benefit position.
Should the tenant agree to pay the current rent and a reasonable amount towards arrears, the landlord should agree to postpone issuing court proceedings for so long as the tenant keeps to that agreement. However, if the tenant fails to comply with the agreement, the landlord should warn the tenant of the intention to bring proceedings and give the tenant clear time limits within which to comply again and avoid proceedings.
If possession proceedings are issued, various steps will need to be taken by the Landlord. These include:
• at least ten days before the court hearing, the landlord must give the tenant up-to-date rent statements and disclose any knowledge about the tenant’s position regarding any benefit claim;
• the Landlord should also tell the tenant the time and date of the court hearing; the terms of the order that will be applied for; and advise the tenant to attend the court hearing as their home is at risk should they not do so;
• Should an agreement be made to pay the arrears after the issue of proceedings which the tenant has adhered to, the landlord should agree to adjourn the hearing for so long as the tenant keeps to the agreement. However, should the tenant fail to adhere to any such agreement to pay the arrears, the landlord should warn the tenant of the intention to restore the proceedings and give the tenant clear time limits within which to comply again and avoid restoration of the proceedings.
If the landlord fails to follow the steps prescribed in the protocol, the judge can make an order for costs, adjourn or dismiss the claim. Conversely, if the tenant fails to comply with the terms of the protocol, the court may take such failure into account when considering whether it is reasonable to make a possession order.
Mandatory grounds for possession
If a landlord is relying on mandatory grounds for possession, the Landlord should prior to issuing proceedings, write to the tenants and explain why possession is sought. Further, require the tenants to notify the landlord in writing of any personal circumstances or other matters which they wish to have taken into account within a specified time. Any representations received should be considered and, if they decide to proceed with a claim for possession, the landlord should provide the tenant with brief written reasons for doing so.
The overall message from the pre-action protocols is that landlords and tenants need to make genuine attempts to resolve matters prior to commencing possession proceedings. There are a number of steps both landlords and tenants need to take as detailed above but it is clear that the landlord’s obligations will be significantly extended as a result of the new protocol.
Disclaimer: This information is for general guidance regarding rights and responsibilities and is not formal legal advice as no lawyer-client relationship has been created. Note that the information was accurate at the time of publication but laws may have since changed.