Providers need to be alive to the risk of contractors becoming insolvent and how to limit the resulting inevitable disruption.
The Private Members Bill Homes (Fitness for Human Habitation and Liability for Housing Standards) Bill now has Government support and was debated on Friday 19 January 2018. We set out below the Bill’s aims and potentially significant implications for all private sector and social landlords.
The Grenfell Tower fire has focused attention on housing standards and the limitations of existing disrepair legislation. This was also highlighted by a Shelter report “Closing the Gap” published in October 2017. We referred to this draft Bill and the Shelter report in our Housing Management Law Update Seminars in November and December 2017, so now the Bill has Government support and is much more likely to become law, it’s a good time to consider what impact it might have.
Current “fitness obligations”
There are of course implied statutory repairing obligations on landlords to keep in repair the structure and exterior of their properties, and to repair installations for the supply of water, heating and sanitation. However, existing provisions requiring landlords to ensure that their properties are fit for human habitation are almost entirely obsolete.
Whilst Section 8 of the Landlord and Tenant Act 1985 prescribes implied terms in tenancy agreements that require landlords to let properties fit for human habitation, the implied terms only apply to properties with an annual rent of £52 or less outside of London and £80 or less in London. As those rent limits have remained unchanged since 1957 (!) they have “withered on the vine” as the Law Commission has commented.
The Homes (Fitness for Human Habitation and Liability for Housing Standards) Bill
The new Bill would remove the rent limits altogether and delete the existing Section 8; substituting it with a new section 8(1). This would introduce an implied covenant on the landlord to ensure that all dwellings (not just houses) are fit for human habitation at the time of the grant of tenancy and kept in that condition thereafter. Where a landlord fails to let and maintain a property that is fit for human habitation, the Bill would give tenants a right to take action in the courts.
The new implied covenant would apply to:
- New tenancies of less than 7 years term granted after commencement of Section 8;
- New secure, assured or introductory tenancies for a fixed-term of 7 years or more granted after commencement of Section 8;
- Existing periodic or secure tenancies as at commencement date are given a grace period - the covenant will only apply from 12 months after the coming into force of Section 8 (Section 8A(4)); and
- Fixed-term leases renewed after the commencement of the Bill for a further fixed-term (the renewal would be treated as the grant of a new tenancy at which point the covenant would apply).
England and Wales
The Bill extends to England and Wales but will only apply to tenancies in England. The Welsh Government has already included similar provisions in relation to housing fitness in the Renting Homes (Wales) Act 2016.
Health and safety
Improving and clarifying fire safety obligations is, of course, one of the drivers for the Bill and entirely welcome and necessary. The fitness duty will apply to any ‘Category 1’ hazard in the ‘Housing Health and Safety Rating System’ under the Housing Act 2004. Examples of category 1 hazards can include:
- exposed wiring or overloaded electrical sockets
- dangerous or broken boiler
- bedrooms that are very cold
- leaking roof
- mould on the walls or ceiling
- rats or other pest or vermin infestation
- broken steps at the top of the stairs
- lack of security due to badly-fitting external doors or problems with locks.
It may well be easier and quicker for a tenant to enforce directly against their landlord rather than asking the local authority to use the HHSRS.
Landlords have to date sometimes struggled to enforce access for such works that are not s11 repairs if there is no additional tenancy agreement term allowing access for health and safety related works. The Bill will largely remove this difficulty.
However, landlords can perhaps also expect broader responsibilities under the ‘relevant matters’ listed, which may go beyond present s11 disrepair liability, such as:
- freedom from damp
- internal arrangement
- natural lighting
- water supply
- drainage and sanitary conveniences
- facilities for preparation and cooking of food and for the disposal of waste water
Liability for damp
Damp caused by condensation is generally not actionable under the s11 repairing obligations. The new unfitness definition, however, covers a property if it is “so far defective in one or more of those matters that it is not reasonably suitable for occupation in that condition”, one of the listed matters above is freedom from damp. However, one of the exemptions is “a tenant’s failure to use the dwelling in a tenant-like manner”, resulting in unfitness.
We should perhaps then expect in future ever more detailed arguments and expert reports about the cause of damp.
The Bill does propose exemptions to the implied covenant under a new subsection 8(2). These include unfitness arising:
- from a tenant’s failure to use the dwelling in a tenant-like manner;
- as a result of natural disaster e.g. a flood.
The Bill is, of course, subject to change having only just been debated at second reading. It will now be scrutinised at committee stage and then by the House of Lords.
However, the Bill has been receiving cross-party support and is being well received by both tenant and landlord organisations. Both the Residential Association of Landlords and National Association of Landlords who represent private landlords have expressed support for the Bill.
We will provide further updates as the Bill passes through the Parliamentary stages if significant changes are made.
There is a very useful detailed House of Commons briefing note, which covers the background to the Bill and its provisions in more detail. Otherwise, do contact Helen Tucker, partner, or Daniel Lawlor, trainee solicitor.
If you would like to find out more about the work that Anthony Collins Solicitors does in the Housing sector, please see our housing pages.
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