The Deregulation Act and Section 21 Notices

29 Sep 2015

From 1 October 2015, a new prescribed form of Section 21 notice seeking possession will take effect as part of the changes introduced by the Deregulation Act 2015 (“the DA”). The DA was intended to clarify and simplify a number of areas of law and cut red tape, and certainly within the context of Section 21 notices these should be seen as welcome reforms. Whilst the Court of Appeal’s decision in  Spencer v Taylor [2013] EWCA Civ 1600 brought about some clarity with regards to the form of Section 21 notice for a statutory periodic AST, the lack of statutory prescribed forms has always created some room for uncertainty. In this article we cover some of the key changes relating to Section 21 notices, and consider whether the Deregulation Act has achieved its aim of clarifying the law or if it has caused more uncertainty.

Section 35 of the DA essentially applies the decision in Spencer v Taylor to all ASTs that are periodic from the outset and provides that a Section 21 notice no longer needs to expire at the end of a tenancy period. This provision applies in England only.

This has long been the position where a Section 21 notice is served during the fixed term. Since Spencer v Taylor, it has also applied to statutory periodic ASTs which come into effect when the fixed term expires. This eliminates the need to debate the often uncertain question of when the tenancy period runs from and to; whether that is in accordance with the rent period or from the date of commencement of the tenancy.

The new form of Section 21 notice must be used for all ASTs which are new or are renewed after 1 October 2015, but it may nonetheless be used for all existing ASTs, and from 1 October 2018 it will apply to all ASTs. The regulations with the new form of notice should be available via the following link from 1 October 2015 Assured Tenancies and Agricultural Occupancies (Forms) (England) Regulations 2015 (SI 2015/620) (Form 6A).

There is a catch…

Before we get too carried away that the DA has truly ‘deregulated’ this complex area of law, further regulation is imposed in Sections 38 and 39, which seek to impose similar restrictions to those already in place in relation to tenancy deposits. It provides that a Section 21 notice cannot be served where the landlord is in breach of the “prescribed legal requirements” or has failed to provide the tenant with information about the rights and responsibilities of a landlord and a tenant under an AST. The Regulations have now clarified that what is meant by this is that the tenant must have been sent at some time before the Section 21 Notice is served:

  • A valid EPC
  • A current landlord’s Gas Safety Certificate
  • The Government How to Rent Guide (this requirement does not apply where a landlord is a registered provider of social housing)

The prescribed legal requirements will apply to all new ASTs or renewals (but not statutory ASTs) in England from 1 October 2015.

That’s not all folks…there’s more!

Unfortunately there are more regulations set out in the DA which affects the landlord’s ability to serve and rely on a Section 21 notice:

  1. In cases of ‘retaliation’- see our article on retaliatory evictions;
  2. From 1 October 2015, a Section 21 notice cannot be served within the first four months of the tenancy, effectively removing the common practice of a notice being served at the commencement of the tenancy and ensuring that the tenant actually has two months notice that possession proceedings will be issued;
  3. Additionally, from 1 October 2015, proceedings for possession must be issued within 6 months of the Section 21 notice being given, effectively giving the notice a maximum 4 months’ shelf-life from the date of expiry. This seems particularly strict, given that a notice served under Section 8 (for example for rent arrears or anti-social behaviour) can run for 12 months.

As can be seen from the changes outlined above the DA has, certainly for private landlords, created yet more layers of red tape at a time when tenancy deposits are frequently causing difficulties when it comes to serving Section 21 notices. Given that Section 21 of the Housing Act 1988 gives the landlord an absolute ground for possession, it is understandable that the government wants to ensure that there is some protection for tenants and it seems that such protection is being introduced by the backdoor. However, these reforms will simply delay rather than restrict the landlord’s ability to recover possession. It will be imperative going forward that landlords know what is expected of them before a Section 21 notice is served and accurate records kept, particularly when it comes to the provision of the prescribed legal information. The strict time limits are particularly concerning and mean that in many cases a landlord will need to make a fairly swift decision whether to pursue a possession claim, or re-serve a new Section 21 notice once the 2 months is up.

For more information, please contact Faye Didcote

Further reading

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