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The Deregulation Act 2015 - what does it mean for residential landlords?

The Deregulation Act 2015 - what does it mean for residential landlords?

Tuesday 10th November 2015

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As if the work of a residential landlord is not difficult enough, we now have the Deregulation Act 2015 (“DA”) which came into force on 23 March 2015. It has brought a number of changes to landlords’ obligations with respect to residential tenancies and from 1 October 2015, further changes have been made to Section 21 notice (s.21).

The aim of the legislation was to assist in clarifying what the landlord needs to comply with, however, Hannah Carter, Senior Solicitor in the Property Solutions team, has analysed the changes and considers that whilst clarity may have been achieved on some aspects, it has not necessarily been achieved on others.  

Tenancy deposits

The DA clarifies the law following the decisions made in Superstrike Ltd v Rodrigues [2013] EWCA Civ 669 and Charalambous v Ng [2014] EWCA Civ 1604 by making changes to the Housing Act 2004 (“HA”). The changes relate to the requirements for registration of tenancy deposits and providing prescribed information to tenants addressing the position prior to 6 April 2007 and on or after 6 April 2007.

Before 6 April 2007

Section 32 DA, through the insertion of s.215A to the HA, clarifies that where the fixed term expired prior to 6 April 2007 and the tenancy became a statutory periodic tenancy prior to that date, the landlord will not be liable for financial penalties for non-compliance with s.213 HA, however, if it wishes to serve a s.21 notice, it will either need to first pay the deposit back to the tenant or register it with a deposit scheme and provide the prescribed information.

After 6 April 2007

Section 33 DA (s.33 DA), through the insertion of s.215B to the HA, clarifies that where the fixed term expired after 6 April 2007 and the tenancy become a statutory periodic tenancy after that date, the landlord will need to comply with s.213 HA by protecting the deposit and providing the prescribed information. The landlord can either do that by 23 June 2015 (being 90 days from the date the DA came into force) or, if s.21 proceedings have been issued for possession of the property, before the conclusion of those proceedings.   

Changes to Section 21 notices and prescribed legal requirements

The DA has brought changes to the information that needs to be provided in a s.21 notice, as well as stipulating certain steps with which the landlord must have complied before it can be serve a valid s. 21 notice. Notably, these changes presently only apply to tenancies that are created on or after 1 October 2015, however, on 1 October 2018 they will apply to all ASTs existing at that date.

So for all tenancies created on or after 1 October 2015, prior to serving a valid s.21 notice, the landlord, must now have and provide to the tenant:

  1. An Energy Performance Certificate

  2. A gas safety certificate

  3. A prescribed information booklet called “How to rent: the checklist for renting in England”. The booklet can either be given to the tenant as a hard copy or electronically, if the tenant is happy to receive it by email.

Also, as of 1 October 2015, in the case of a statutory periodic tenancy, it is no longer necessary for the termination date specified to be the last day of the period. However, if a landlord serves notice to end the tenancy prior to the end of the period then the tenant is able to claim back any rent it has paid in advance in relation to the time to the end of the period.

Many landlords choose to serve a s.21 notice at the start of the tenancy. It will no longer be possible to do this as Section 36 DA (s.36 DA) provides that a s.21 notice cannot be served within the first four months of the tenancy, and in case of a replacement tenancy within the first 4 months of the original tenancy. The result of this change is that it is no longer possible for a landlord of a six month fixed tenancy to serve a s.21 notice to expire on the last day of the fixed term. For the avoidance of doubt, this does not apply to a tenancy that has become a statutory periodic following the expiry of the fixed term. Section 36 DA also introduces time limits on issuing possession proceedings following the expiry of a s.21 notice. As such, for a notice served during a fixed term, possession proceedings cannot be issued after six months have passed since the date of expiry of the notice. Further, where a notice is served after the fixed term (when a statutory periodic tenancy has arisen) possession proceedings cannot be brought if more than four months have passed since the expiry of the notice.   

Retaliatory eviction

To prevent a landlord from serving a s.21 notice in response to a tenant submitting a complaint about the condition of the property, s.33 DA invalidates a landlord’s s.21 notice where:

  1. The tenant has submitted a written complaint to the landlord regarding the condition of the property before the landlord has served a s.21 notice.

  2. The tenant has submitted a written complaint and the landlord has not provided an adequate response within 14 days beginning on the day on which the complaint was made.  If the landlord provided an adequate response within these 14 days he can proceed with the s.21 notice. Although the Act does not explicitly refer to the point at which the landlord can serve a s.21 notice, say in the event the landlord responds to the tenant’s complaint after the 14 day requirement, it appears from s.33 DA that the tenant needs to make a complaint to the local authority within a reasonable amount of time and depending on the local authority’s decision to serve a relevant remedial notice or not, the landlord then either has to do remedial work or can serve the s.21 notice in the absence of the local authority serving a remedial or improvement notice.

  3. The landlord has provided an inadequate response to the complaint – the criteria for an adequate response are found at s.33 (3) DA. 

  4. The tenant has complained to the local authority and the local authority has served an Improvement Notice or Emergency Remedial Notice. Once the landlord has completed the works it can then serve a s.21 notice.

Please note this article is a summary of the main changes and it is not a comprehensive or exhaustive guide. Any landlord involved in letting residential properties should carefully refer to the relevant legislation and seek legal advice if in any doubt about the extent of the applicable obligations.

Smoke alarm regulations

A further change for the residential landlord to note is that as of 1 October 2015 regulations have been introduced relating to smoke alarms in residential lettings. For more information on these changes please refer to our other article here.

If you wish to discuss these changes in more detail please do not hesitate to contact:

Hannah Carter

Senior Solicitor
Tel: 0151 600 3056