They are Evictions Jim, but not as we know them

At 21:15 last night, a rather fundamental piece of legislation was released under the cover of darkness, this Statutory instrument is know as THE CIVIL PROCEDURE (AMENDMENT NO. 4) (CORONAVIRUS) RULES 2020

Coming into force on 23^rd August amendment No4 sets out a number of new steps landlords will have to take once the courts reopen on 24^th August.

The important thing to remember is this is temporary legislation with an end date of 28^th March 2021but like all of the Covid related temporary legislation, does  have a review clause meaning this can be withdrawn or altered before that date.

The first item to note is that this amendment suspends the standard time frame from Claim form to hearing, which current sits at 8 weeks, this means landlords can expect to wait much longer in some situations than this standard time frame.

The second point is that these new measures will effect ALL claims currently suspended under the Covid-19 regs, regardless of whether the claim was submitted before, during or after 23^rd March 2020.

The key point to remember is this amendment DOES NOT effect how a S21or S8 is issued nor its function as a mandatory notice seeking possession.

What amendment No4 does do however, is bring in a number of requirements on the landlord to enable a claim to progress.

What landlord will need to do

• ·        In order for any claim currently suspended in the court process to continue after the courts reopen on 24^th August, Landlords (the claimant) will have to write to both the tenant ( the defendant) and the court informing them that they wish to proceed with the claim, this MUST be in writing and will be known as a ‘Reactivation Notice’  as yet we do not know if this will need to be in any type of prescribed form.

• ·         Without a Reactivation notice claims WILL NOT be processed – There is no charge for submitting the Reactivation notice.

• ·         Landlords will need to provide the court with as much information as possible in relation to the tenants (and their dependants)  circumstances regarding Covid-19, such as vulnerability, Shielding and financial status, eg: claiming UC or furloughed etc.

Ø  Ideally this should be provided with the Reactivation notice, but can be submitted prior to the hearing.

• ·         The landlord MUST provide a FULL rent arrears history up to the date this document is submitted to the court

Full guidance supporting this amendment is yet to be released, but as soon as it is I will bring a more detailed update

Property management... Still not Important for agents

Since the tenant fee ban came into force in 2019 there has been a knee-jerk reaction from letting agents to increase their fees to Landlord to help cover the loss that they were going to see from not being able to charge tenants.

But with the increase in fees sadly we did not see an increase in service.

Statistics released by The Property Ombudsman in their last annual report showed that communication and property management were the highest source of the complaints.

Why is it with all of the technology available at our fingertips, the majority of letting agent still fail to communicate and still fail to manage our properties to a good standard, surely as the professionals in the industry  letting agents should have the upper hand of both knowledge and skill when it comes to managing a landlords property.

It would seem that many agency owners do not put as much value in the role of a property manager as they do their negotiators, even though property Managment is the bread and butter of many agents who would undoubtedly fold without it.

Qualifications and training of property managers are not high on many Directors to do lists.

Yet, property managers rarely have the knowledge or skill set to effectively manage 1 property let alone the agency average of 250 and find that in many situations the landlord is actually more knowledgable than the agent they are paying to be the expert.

Nothing more than glorified PAs to the landlords property managers still only seem able to take a maintenance report from a tenant and pass this on to the landlords and wait to be told what to do next. is that really worth 15% of your monthly rental income?

Surely the reason many landlords opt for a fully managed service is to be hands off and not be bothered by the tenant calling about the silliest of things, instead the landlords simply swaps that scenario to have the agent bother them with every little thing.

Agents and especially property managers need to understand they are presenting themselves as the industry experts and start to take pride in the fundamental service that a Landord relies on.

I have worked with a number of letting agents and seen the poor quality of property Managment, many don’t know the very basics of the landlords responsibility let alone have an understanding of the legislation.

Most reported illegal Evictions are actually carried out by letting agents and not, as the media would have you believe, rogue landlords.

But the crux of the issue here is, no matter how inexperienced or how monumental the mistake an agent makes, the law states the responsibility lies with the Landord, so when your property manager doesn’t serve your Gas certificate on the correct date or fails to register a deposit and you find you can’t evict your tenant, ultimately the buck stops with the landlord, it is the Landord who gets the hefty fine it is the Landord who is stuck with thousands of pounds of court fees.

So what is the answer? 

Communication isn’t difficult in this day and age and with some good basic knowledge and an ability to use a diary, property managing isn’t rocket science.

But until the industry starts to take this area of its own business more seriously, sadly we will continue to see complaints rise and more landlords fall foul of a glossy sales pitch and be left out of pocket and tenants will suffer poor housing standards through lack of remedy.

Some letting agents misinterpreting landlords responsibilities regarding legionella risks to their tenants

There is a legal duty for landlords to assess and control the risk of exposure to legionella bacteria, but Health and Safety law does not require landlords to produce or obtain, nor does HSE recognise, a ‘Legionnaires testing certificate'.

• Legionella testing (or sampling) is generally not required in domestic hot and cold water systems and then only in exceptional circumstances.

• Misinterpretation of the legal requirements by some consultants and letting agents about landlords’ responsibilities to manage and control legionella in domestic premises may result in unnecessary financial burdens being placed on landlords and tenants.
• - Portable Document Form- Portable Document Format

Some letting agents are using the revised L8 ACOP to suggest that new legislation has been imposed on landlords of domestic rented properties for managing and controlling the risks of exposure to Legionella bacteria of their tenants. This is wrong, the legislation has not changed and misinformation/misinterpretation can impose unnecessary financial burdens on landlords where they are being charged for legionella testing and certificates they don’t actually need.

The law is clear that if you are a landlord and rent out your property (or even a room within your own home) then you have legal responsibilities to ensure the health and safety of your tenant by keeping the property safe and free from health hazards.

Section 3(2) of the Health and Safety at Work Act 1974 (HSWA) makes provision for relevant health and safety legislation to apply to landlords to ensure a duty of care is shown to their tenants’ with regard to their health and safety.

HSE has published guidance for landlords.

Possession for Rent Arrears to get a whole lot harder. Landlords will need to be more hands on than ever.

Unless otherwise announced, Courts are due to reopen on 25th June and the media predict a flood of Evictions to sweep England. 
Realistically, we already know that courts, when they reopen will priorities certain applications over others, for example, variation orders and requests to set aside existing possession claims.
After that we expect the courts to deal with the most serious possession claims first, such as Anti-social behaviour, then rent arrears claims and final S21 claims as these need no fault to be proved.

It is possible that prior to 25th June the court system or the notice period of 3 months could be extended.
But what we do know is that Robert Jenrick has announce a Rent arrears Pre-Action Protocol will be issued before the courts reopen.
So, what does a pre-action protocol mean for landlords,  at present we have not seen a draft of this new measure, nor do we know if this will be legally binding or just a “good practice guide”

So let’s look at the possibilities the protocol could bring.
The social housing sector has had a Pre-action protocol since 2015 and forms part of the Civil Procedure Rules and sets out the Court’s expectation of the parties’ conduct before a claim is issued
It is expected that the protocol that will be issued for Private landlords will follow a similar set up and will set out the process a Landord will need to follow before a court will entertain an application for possession.

The Social Landlords protocol is separated into 3 parts:
• Action before notice is served
• Action before court application 
• Action before court hearing

In all of these sections the responsibility is on the landlord to prove that have met and abused by the protocol before executing an action.
For example, before a landlord can issue a S8 notice for rent arrears, they must demonstrate that they have engaged with the tenant at the earliest opportunity, provided a rent statement every quarter, discussed the tenants financial circumstances, explored their eligibility to claim benefits or grants and discussed repayment options.
Only after all this has been satisfied can the landlord confidently serve a S8 notice.
After notice has been served this is not the end of the landlords duties, they must now prove ongoing communication with the tenant and evidence that they have supported the tenant to make any benefit claims and signposted them to independent advice organisations such as Citizens advice.

The courts also in the case of social landlords expect both parties to engage in Alternative Dispute Resolution (ADR) before a Landlord submits an application for possession to the courts.

For social landlords, failure to meet these requirements will lead to the court issuing them with a claim to pay all costs, the possession hearing can be adjourned and in some cases the judge will just strike out the claim, leaving the landlords to have to start the process from scratch.

We do not know how detailed the Private Sector Protocol will be and it is very unlikely to be retrospective. 
But I would recommend landlords start to follow some of the process of the Social Landord pre-Action protocol as general good practice, to ensure that when the protocol is published in the next few weeks, you are already ahead of the game.

View a copy of the Social Landord Pre-Action protocol here.
https://www.justice.gov.uk/courts/procedure-rules/civil/protocol/pre-action-protocol-for-possession-claims-by-social-landlords

Another blown for Universal Credit tenants struggling to pay their rent

This one slipped under even MY radar.

The Department for Work and Pensions (DWP) announced on 10th April that Universal Credit rent arrears deductions have been suspended amid the coronavirus pandemic.

Third-party deductions, which typically see claimants have money they owe taken from their monthly benefit allowances, will be scrapped until 10 May.

Universal Credit claims have increased sharply as Covid-19 batters the economy. 

More than 1.4 million have applied for the benefit in recent weeks, according to the government, which recently took the decision to suspend evictions until June. 

A spokesperson for the DWP said: “We have received an unprecedented number of new benefit claims and have streamlined our operations to make sure people get the support they need during this time.

“As part of this, we have temporarily paused third-party deductions from [Universal Credit] – these will recommence on 10 May.

“We are in the process of explaining the changes to claimants via their online journal and to third parties, including housing providers who collect arrears via this method.”

The question is, How will this effect tenants who have been granted suspended possession orders on terms they pay the arrears and were having these deducted directly from their benefits.

Although this is only suspended for 1 month, this could have a huge impact on the tenants who have yet to be informed ( as DWP have said they are still in the process of informing both claimants and landlords) that the direct arrears payments have been stopped and are not aware they need to pay the deducted amount themselves 

With courts suspended until at least the end of June, will this impact on the number of eviction applications that are submitted to court?

Sadly the DWP have not thought this action through and risk jeopardising tenants security of tenure in their homes through no fault of their own

Source LandlordToday.

Don’t Panic!!!! Rent arrears see minimal increase since Lockdown

Many tenants have been laid off, furloughed, or have seen their incomes plummet because of the response to the coronavirus outbreak, and yet there has only been a 2% increase in late rental payments, according to new research. 

Given that many people have lost jobs or income because of the coronavirus pandemic, there were concerns that a higher number of tenants would not pay their rent, and so the findings from the study by property technology company Goodlord will be welcomed by some landlords. 

Goodlord analysed payment trends from a representative sample of 20,000 UK rental properties. 

In addition, only a small fraction of landlords are processing rental insurance claims, indicating that they are not yet out of pocket.
Since March 11th, there has been a modest increase in late payment behaviour - 2% more properties than usual still owing rent after seven days. This is an increase from 4% to 6%. 

Likewise, claims from landlords against Rent Protection insurance policies remain comfortably below 1% of rented properties covered. 

However, 84% of the 124 letting agents surveyed have reported confusion amongst tenants, with many not realising they remain under obligation to pay rent.

Of those surveyed, seven out of 10 - 70% - said that they have agreed payment plans with less than 10% of tenants so far, further indicating that the financial impact of the pandemic has yet to impact the ability of most tenants to meet their rental obligations. 

Tom Mundy, COO of Goodlord, said: “Despite only being a month since lockdown began, the late payment figures for the rental industry are so far fairly steady. They show that the overwhelming majority of tenants are still able to meet their obligations and we believe the government’s furlough scheme will no doubt be playing a key role in this continuity. 

“At the same time, agents and landlords are gearing up to offer more support in the months to come. Many agents, along with their landlords, are thinking about how they can offer flexibility, support, and guidance to tenants who might start to struggle.”

Source Landlord Today  

Til death do us part - But AST isnt the end

Death isn’t something we like to think about or even talk about the majority of the time, but as landlords this is something we may need to deal with at some point.

Sadly, the probability of having to deal with this situation has increased with Covid-19 effecting so many people.

In my professional capacity, I have had to deal with over 12 deaths of tenants, occupants or residents in all types of situations, from suspicious deaths, murders, suicides to ill health and old age.
But the key facts remain the same and that is how to correctly deal with the death of your tenant.

We will, for the purpose of this article assume the tenant has passed from natural causes and has an Assured shorthold tenancy (AST).

There are 2 main scenarios for you as a landlord to work through and I will address each in turn, so let’s start with the easy one.

Scenario 1. Tenant passes away and there are Next of Kin ( NOK)

The important thing to remember is that under English law the AST does not end on death of the tenant, but remains an active tenancy accruing rent until it is legally ended.

The first thing  you must do is contact the NOK and find out if there is a Will and who the executor is, from this point onward it is best to communicate direct with the executor rather than the NOK.

Next, you need to arrange for the tenancy to be ended, this can be done in 4 ways.
• Notice to quit from the tenants estate
• You serve a S21
• You serve a S8 using mandatory ground 7
• Deed of surrender
Realistically options 1, 2 & 3 are the best because they will limit the liability for rent owed and allow a practical timeline for you to get the property back in your possession.

Rent & Rent arrears
While the tenancy is active rent will continue to be due, the liability for this rent rests with the tenants estate until the AST is ended, this is why it is in everyone’s best interests to end the tenancy as quickly as possible, to minimise the estates liability, but also to minimise the debt owed to you, in case the tenant has little or no value in their estate.

Security deposit
At the start of the majority of tenancies, a security deposit will be taken and registered with one of the 3 deposit schemes, this deposit remains the tenants money at all times, or in this situation, it remains the money of the tenants estate and must be returned to the estate accordingly.
You will need to process the deposit in exactly the same way as if the tenant were still alive, so carrying out a check out inspection and requesting deductions for any damage or dilapidations or of course rent arrears.
This is another key reason why you need to have opened communication with the executor early on in the process, as it is likely NOK may not want to discuss or accept any deductions you may wish to make from the deposit.

Clearing the property of possessions
This can sometimes be a delicate situation to have to approach with grieving relatives. The fact that you need the property emptied so you can relet balances with the family’s  time to grieve and prolong a heartbreaking task.
As a guide I would suggest following local authority and housing associations protocol and giving the family 14 days to visit the property take what they wish and surrender the property back to you.
This will need to be communicated with the Executor of the Will incase there are any specific items that are addressed in the Will and need to be dealt with in a certain way.

Possession left behind
Once the family have visited the property and collected everything they wish, there maybe a number of items left that belonged to the tenant that the family do not want to take.
You cannot just throw these out.
You, as the landlord are still bound by Tort law to safeguard those possession and only dispose of them when you have permission or a set time frame has passed.
The law in this case is Torts (interference with goods) Act 1977, which explains that you must serve a Torts Notice on the tenants estate explaining that you will give them a set period of time to remove the good or you will then dispose of them.
If you get a letter directly from the Estate stating that the remaining possessions can be disposed of, then there is no need for the Torts Notice.

Scenario 2- No next of kin or Will
This scenario is not as unusual as you may think, as a society we are more disconnected than ever with many people living alone without immediate family.

So if a tenant passes away and have no NOK, this is known as Intestate, in this situation the local court of where the person died will appoint an administrator.
It is important to note, that it will be the court closest to where a person died rather than a court closest to where a person lived, this is important to note if a tenant dies outside of the home, may be on holiday or in a hospital miles away from the property.

If you do not know who the court administrator is, you can contact your local court and ask for the Pubic Trustee, who will be able to locate the administrator for your tenant and for which court you need to liaise.

All of the other points I raised in scenario 1 still apply, the tenancy will need to be ended and the administrator advised of rent due.
The court administrator cannot end the tenancy with a Notice to quit and if the tenancy has migrated to a periodic then your only resolution is to serve a S21 on the court administrator as the tenants representative and a copy to the property.

There is a slight difference with regards to possessions left in the property, as there is not NOK, you as the landlord automatically become an Involuntary Bailee and you have no legal right to dispose of any of the tenants possessions.
In this instance you must serve the Torts Notice on the court administrator and follow the Torts process to the end in reappear of removing any of the deceased tenants items.