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Landlord and tenant law update: Important Changes from 1 October 2018

10
Sep

Residential Landlords should already be aware of the Deregulation Act 2015 (the Act), which previously brought into effect requirements relating to all Assured Shorthold Tenancies (ASTs) in England granted after 1 October 2015.

Whilst the legislation originally had no retrospective effect, meaning that ASTs granted before 1 October 2015 were not covered by the provisions, this is due to change on 1 October 2018.  This means that any Landlords who have an AST granted before 1 October 2015 need to take action now to ensure compliance.

The new rules implemented by the Act relate primarily to the way in which ASTs can be granted and terminated, and also place restrictions on the Landlord’s ability to serve a Notice under Section 21 of the Housing Act 1988 to terminate the AST.  The Section 21 Notice (known as a “non fault notice”) is a very common mechanism for bringing an AST to an end after a fixed term period has expired.

By way of a reminder, the new rules prevent a Landlord from serving a Section 21 Notice unless it has first complied with its statutory obligations pursuant to sections 38 and 39 of the Act which requires the Landlord to have provided the tenant with the following:

1.  An Energy Performance Certificate (EPC) free of charge;

2.  A Gas Safety Certificate; and

3.  A copy of the current version of MHCLG: How to Rent: The Checklist for Renting in England. (Landlords should note that they are not required to supply a further copy of the booklet each time a new version of it is published during the tenancy).

The Act also brought in a prescribed form Section 21 Notice, which was only optional if the AST was granted prior to 1 October 2015.  This is no longer the case, and from 1 October 2018 the prescribed form must be used regardless of the date the AST was first granted.

We are still awaiting definitive case law as to whether Landlords can comply with these requirements late, i.e. after the AST has already been granted.  Whilst there are arguments and counter arguments, there are non binding cases where it was found that a Gas Safety Certificate must be provided to the tenant at the start of the tenancy, rather than later on to allow a Section 21 Notice to be served.  It is anticipated however that given the retrospective effect of the legislation, Landlords will have a stronger argument that they should not be penalised so long as the documents are provided before the 1 October 2018 implementation date.

In the circumstances we would strongly advise all Landlords to check their ASTs, and take action in respect of any which were originally granted before 1 October 2015.  This will involve providing tenants with the EPC, Gas Safety Certificate and How to Rent booklet (if they have not already done so).  Alternatively Landlords may wish to consider agreeing a surrender of the AST with their tenant, and granting a new AST ensuring compliance with the Act’s requirements.

If you have any queries about this article, or have any landlord and tenant related issues then please contact David Low (djl@swinburnemaddison.co.uk) or Rachel Stapleton (res@swinburnemaddison.co.uk), or call 0191 3842441.

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