In the fourth part of our series on contract management pitfalls, we look at the risks arising out of varying the terms of construction contracts.
Clearly this is also relevant to local authorities monitoring the private rented sector. We also cover other changes that apply from 1 October 2015.
Do note that the Regulations have, as of today, been amended as there was a serious error in the prescribed section 21 notice. This has now been rectified and the correct section 21 notice can be accessed using the link at the bottom of the page (see section on ‘Other important changes, below, for further details).
For assured shorthold tenancies (ASTs) that begin after 1 October 2015 a section 21 notice can no longer be served/is valid unless the tenant has already been provided with:
- An Energy Performance Certificate (EPC) for the property – which Landlords are (in most circumstances) already under an obligation to provide before the commencement of the tenancy;
- A current gas safety certificate – which again, landlords are already under an obligation to supply to the tenant before they occupy the premises and after every annual check; and
- For private landlords only, a copy of the CLG booklet “How to rent: the checklist for renting in England”. This can be found by clicking here.
- If the booklet is provided at the tenancy start date or at any time later, a further copy does not need to be provided to a tenant with the s21 notice. However if a new version of the booklet has been published before the start of a replacement tenancy (e.g. second fixed term tenancy granted immediately on expiry of previous fixed term) the updated booklet does need to be served before or with the s21 notice.
If the tenant has not had these 3 documents before (despite the fact that would be a breach of the other regulations which require landlords to provide them at the start of the tenancy!), serve them before or with the s21 notice.
We also suggest that landlords obtain permission from the tenant at the tenancy sign up to accept service of the DCLG booklet by email to a specific email address so as to avoid having to serve a hard copy.
New provisions for private landlords also come into effect for all new ASTs granted on or after 1 October 2015 aimed at preventing retaliatory eviction for reporting disrepair. However, the regulations set out an elaborate procedure which must be followed before a section 21 is invalid.
Essentially, the rules provide that a section 21 notice cannot be given within 6 months of a landlord receiving an Improvement Notice from the local authority in respect of a property. However to get to this point:
- The tenant must first make a written complaint to their landlord;
- The landlord has 14 days to provide an ‘adequate’ response;
- If not, the tenant must complain to the local housing authority;
- The local authority should then inspect the property and serve the improvement notice; and
- Any section 21 notice issued after the tenant’s written complaint is invalid, and any ongoing possession proceedings will be struck out. However, if an order for possession has already been granted, the Council’s notice has no effect.
Registered providers of social housing are exempt from this requirement. The legislation also does not apply retrospectively to existing tenancies, and thus only provides protection for tenants on ASTs granted after the 1 October 2015.
Other important changes
The irony of the ‘Deregulation’ Act is that it introduces a whole new scheme of regulation for section 21 notices which apply across the board to all landlords! The important changes are listed below:
- There is a new prescribed form for section 21 notices which must be used for all ASTs which started on or after 1 October 2015; this can also be used for tenancies that began earlier if you choose to. Do note that the original new section 21 notice first published 7 September 2015 contained an error at part 3, which said that the notice is only valid for four months from the date of issue for periodic tenancies – this is wrong! The notice is valid for four months from the date after which possession could be required (which is in effect 6 months);
- A section 21 notice cannot be served within the first 4 months of an AST;
- As now clarified - Landlords essentially have 6 months from the date of issue of the s21 notice to start proceedings under fixed term ASTs. For properties under rolling/periodic tenancies the form is valid for 4 months from the date after which possession could be required, otherwise the notice expires;
- The requirement that the section 21 notices must expire on the last day of a period of a tenancy is no more – 2 months notice is all that is required. But for ASTs granted with a quarterly or 6 monthly period of tenancy (less common), the notice period cannot be shorter than that period of the tenancy;
- There is a ban on section 21 notices being served at a time when the tenancy deposit is not held in accordance with an authorised scheme, so make sure you are complying with the rules on tenancy deposits.
The new rules initially apply only to ASTs in England granted on or after 1 October 2015. After 3 years (i.e. after 1 October 2018), they will apply to all ASTs whenever they began.
The Act and new Regulations mean you need to:
- Make sure EPCs and gas safety certificates are served at the start of tenancies failing which serve before/with section 21 notices;
- Ensure that the DCLG booklet is issued to tenants at the outset of their tenancies and serve and updated version where a ‘new’ replacement tenancy is granted (where relevant);
- Use the new section 21 notice prescribed form for ASTs beginning after 1 October 2015;
- Double check your compliance with tenancy deposit regulations;
- Obtain a tenant’s email address at sign up and ask them to agree it can be used for service of notices and other documents in connection with the tenancy.
How can we help?
- The new and updated section 21 notice form is available here.
- Clients can request a Word version of the section 21 notice by emailing Katey.Slaughter@anthonycollins.com.
For more information
Contact Helen Tucker.
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