Tag Archive for 'private landlords'

John Healy saves the world*

Published
by
NL
on 03/02/2010
in Assured Shorthold tenancy, Housing law - All and Regulation and planning
. 12 Comments

*Not really.

The current housing minister, who holds the current record for the number of times a housing minister’s name can be mentioned in a press release, has announced forthcoming legislation, in response to the Rugg report. More details here [link to PDF]. The announced headlines are as follows, then we’ll take a look at the substance.

Funding for a new housing hotline offering free help and advice for private tenants should things go wrong.

An online word-of-mouth directory of landlords similar to tripadviser or mumsnet. Consumer Focus is currently undertaking work to establish better ways for tenants to provide and access information about landlords’ track records.

A requirement for written tenancy agreements that will strengthen the hand of tenants should they face a dispute and ensure all tenants and landlords are clear of their rights and responsibilities.

Boosting the number of tenants protected under the most commonly used tenancy agreement. An increase of the short-term rental threshold to £100,000 a year will mean that many shared households, most often those of students or seasonal workers, will have their rights strengthened and protected by legislation should they face a dispute.

A National Register for Landlords to help tenants make basic checks on their prospective landlords. Councils will be able to identify local landlords more easily, making enforcement of letting rules easier, and registered landlords will gain access to the latest advice and information on what their role entails and how best to fulfil their responsibilities

Better regulation of letting and managing agents, which will help tackle the rogue agents who can drag the reputation of the Private Rented Sector down. Full legislation will drive out the worst practices such as wrongful eviction, raise standards and provide greater protection for both tenants and landlords in cases of dispute.

Work is also currently underway with councils across England to encourage best practice in taking a more business-friendly approach to working with the best landlords and agents in their area. Creating Local Letting Agencies, where councils and good landlords work together to help local people find better-quality homes in the private rented sector will help to effectively side-line the cowboys across the country.

So, clear substance is:

  • the raising of the AST annual rent limit to £100,000 (which is well overdue)
  • a requirement for a written tenancy agreement (although how would this be enforceable?)
  • regulation of letting agents (although what this actually means will have to be seen)
  • Surprisingly, a compulsory national register of landlords (except leasehold, holiday lets and resident landlords) even with suggestions for enforcement.

The pure wind/smoke/mirrors are:

  • A mumsnet for tenants to swap tips on landlords. Why on earth is the Government proposing to do this? Governments don’t do this kind of thing well. And who ends up liable for the libel?
  • Funding for a new housing hotline to provide advice to tenants. We already have several versions of this, all more or less underfunded. If this is to be a national advice line, prospectively covering the entire rented sector (approaching 40% of households), then that is serious money. And the training of the advisors? Look, if they are going to hand out the money to actually provide such a service, I’m going to be rebranding myself as a trainer for tenant advisors. But we all know that isn’t going to happen. Instead, at best, a horde of basically trained call centre fodder will be let loose on some of the most complicated public facing law this jurisdiction can offer.
  • Local Letting Agencies, where private landlords and local authorities work together in happy harmony. Uh huh.

So, some potentially good bits, even surprisingly so, but also some airy nonsense. Now let us see whether this makes the statute books.

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Way beyond the Naughty Step

Published
by
NL
on 07/09/2009
in Various (non-housing)
. 0 Comments

Some private landlords treat tenants as a nuisance. A sitting tenant can get in the way of a quick deal or reduce the value of a property on which the landlord is hoping to make a quick buck. Thanos Papalexis found himself in this situation when Charalambos Christodoulides, the resident caretaker of a derelict warehouse complex in Kensal Rise, refused to leave, potentially causing problems for a £2 million property deal. Mr Papalexis didn’t resort to illegal eviction, though. He had another solution for the problem presented by Mr Christodoulides.

He had him killed.

In fact, Mr Christoduoulides was tied to a chair, tortured, then strangled.

Mr Papalexis, of Palm Beach, Florida, besides being a callous murderer, appears to have had a number of issues with adequacy, some of which may have led to the killing.

For starters, there was the fact that he wasn’t a very good property developer at all. He desperately needed the money from the warehouse sale because he had made heavy losses on another development in Holloway (in 2000! How did any property developer make heavy losses in 2000?) and was paying £60,000 a week on a bridging loan.

And then there was his confession in 2004 to Rebecca DeFalco, a Florida based prostitute/porn actor/’high class call-girl’, with whom he had an affair. He told Ms DeFalco that he had strangled a man who got in his way. The competency issue arises because a) he confessed to someone unlikely to be wholly trustworthy and b) because this may be the only true thing that Mr Papalexis told Ms DeFalco, as he spent the rest of the time telling her he was a spy who worked for MI6 and the CIA, presenting her with a rosary supposedly removed from the hands of his mother’s exhumed corpse ‘to make her feel special’ (as one does), and, of course, telling her the old favourite that he and his wife ‘had an understanding’, which came as news to his wife.

We won’t go into the ‘wild sex parties’ at a rented Florida mansion, but even there Mr Papalexis managed to bring in a note of failure, telling the court that there had only been one such party. (This is not in any way to be confused with the fundraiser attended by Hillary Clinton that Mr Papalexis had also held at the mansion.)

The police were after Mr Papalexis for years, and in 2006 he was extradited from Florida to face trial for the murder of Mr Christodoulides, whose battered body had been found in a basement in the derelict Kensal Rise site. Mr Papalexis was found guilty last Friday and stands revealed as a truly vile specimen of humanity.

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"Unauthorised tenancies": New Consultation

Published
by
Dave
on 05/08/2009
in Housing law - All and Possession
. 9 Comments

I have found myself unaccountably lethargic post-lunch, so when the Chief put us on to the new DCLoG consultation document on “unauthorised tenancies” I jumped at the opportunity to post on it.  It’s a beautifully produced document with lots of pictures, about a small but immensely important issue: a borrower, in breach of the mortgage conditions, creates a tenancy of the property; during the currency of that tenancy, the lender takes possession proceedings (or just possession, eg voluntarily); the lender, on standard principles of property law, is not bound by the tenancy; but what should happen to a borrower’s “tenants” who can otherwise be evicted on short notice?  Francis’ excellent post on the 50th update to the CPR pointed out the changes made in terms of notification to the occupiers.  But DCLoG had already committed itself to taking action – which represents a major success for the campaign run by the CAB, Shelter, Crisis and the CIH (see their document, A Private Matter, which is liberally quoted in the CP, and for which congrats from me).  The CP estimates (and there can be no precise figure) that there are around 2-3000 tenants pa in this position (para 1.17), and sets out three objectives for the proposal, that they should be practical, proportionate and fair.

The resulting options are fivefold, although really there is only one.  Option 1- do nothing – is discounted for obvious reasons (ie the government has already declared its intention to change the law).  The government’s preferred option is option 2 (and strongly preferred to the extent that the three others are seen as possibilities in tandem with option 2 – see para 3.6).  Option 2 is this: Give the courts a power to delay possession for unauthorised tenants.  That power would be for two months on a tenant’s application to, and adequate representations at, court in the possession proceedings.  The policy benefits are obvious to DCLoG: “It would also encourage tenants to attend court and become a part of the process, and provide a mechanism for early direct contact between the lender and any tenant, both of which are highly desirable”.  It is recognised that this may still leave problem issues – where the borrower is in breach of an SPO and the lender takes possession; voluntary repo’s; and where the tenant doesn’t open the mail.

These issues lead into the three alternative options, of which the favoured one appears to be option 4: New notice of intention to enforce possession, with a mechanism for unauthorised tenants to apply for a delay of enforcement.  Basically, the lender sends a notice to the occupier when it intends to enforce its right to possession.  The notice would give the tenant 14 days to apply to the lender for a two month delay in the eviction.  Now, in principle, that’s not a bad idea, but it does require us to trust the lender and, when it comes to lenders and possession, “trust” is not something I necessarily have in lenders, who in this case would also be required to decide if the claim was genuine or not (with a right of appeal to the County Court).

My other concern about these proposals is that, although they are undoubtedly well-meaning, how many tenants are really going to make those representations?

DCLoG also sets out the work it is doing behind the scenes, including promoting the use of receivers (although readers may also be interested in J’s post on Horsham v Clarke and Andrew Dismore’s 10 minute rule Bill on this point), clarifying advice from the FSA and CML.  All-in-all, a fair bit of back-slapping, although whether the same can be said of DCLoG’s mortgage support scheme is up for grabs (how many successful applications have there been?).

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Foxtons' terms unfair

Published
by
Francis Davey
on 13/07/2009
in Assured Shorthold tenancy, FLW case note and Housing law - All
. 2 Comments

In a long awaited decision the High Court has held in Office of Fair Trading v Foxtons [2009] EWHC 1691 (Ch) that some of the terms and conditions contained in Foxtons’ contract with landlords were unfair. While strictly speaking this decision is unrelated to housing law, concerning as it does the fairness of consumer contracts, it will have an impact on the housing sector and the decision itself is instructive in the application of the Unfair Terms in Consumer Contracts Regulations 1999.

The case was brought by the Office of Fair Trading who were claiming injunctive/declarative relief against Foxtons under their power to do so granted by regulation 12. The claim concerned only Foxtons’ terms of business to landlords using the letting only service. In response to the claim Foxtons changed their terms and the court agreed to consider their fairness as well. As a result the decision talks about “old terms” and “new terms”.

Note that, although the regulations only deal with consumer contracts, many landlords are not professional landlords (in that it is not their main business) and so contract with Foxtons as consumers. A witness for the OFT gave examples:

They include individuals who decide to let out their only property whilst travelling temporarily abroad, as a result of relocation by their employer or for other reasons connected to ‘lifestyle’ choice, individuals who let out part of their property in order to fund their mortgage on the remainder, and individuals for whom their property investment represents part of their pension plan or other long term saving….

The court had no hesitation in accepting that the regulations could apply.

Old terms

Foxtons charged a commission for introducing tenants Introduced tenants — the usual way in which letting agents do business. In addition to this a “renewal commission” was charged on tenancy renewals in a very wide range of circumstances:

2.14.3 Renewal commission will become due in respect of renewals, extensions and hold-overs or new agreements where the original tenant remains in occupation. It will also become due where the incoming tenant is a person, company or other entity associated or connected with the original tenant, either personally, or by involvement or connection with any company or other entity with whom the original tenant is or was involved or connected. Where there is more than one tenant, renewal commission will be payable in full where any or all of them remain in occupation. Commission is due whether or not the renewal is negotiated by Foxtons.

As well as questioning its fairness the OFT raised the issue of whether this term was even intelligible. What, precisely, does “associated or connected with” mean in this context? The clause clearly allows Foxtons to take a cut even if it has had no involvement with the property for some considerable time. On every occasion the tenancy is renewed, they are due a commission.

Worse another term provided that, if a tenant, occupier or licensee purchases the property from the landlord, Foxtons wwoud be due 2.5% of the purchase price in commission.
The landlord cannot even avoid a series of commission payments to Foxtons by selling the reversion, beacuse another term provided:

Where a property is sold, transferred or otherwise dealt with, with the benefit of a tenancy, Foxtons’ fees remain the responsibility of the original landlord for the duration of the tenancy and for any extensions, renewals or periods of holding-over, irrespective of whether negotiations were carried out by Foxtons. The landlord should instruct his solicitor to assign responsibility for Foxtons’ fees to the purchaser.

Awesome stuff.

New terms

Only the renewal commission remained (sales commission and third party renewal commission were dropped). The clauses dealing with the renewal commission, included the following:

1.1.4 Where a tenant introduced by Foxtons is replaced as tenant (whether or not under a formal tenancy agreement) by his nominee (whether a natural or legal person) the commission will remain payable for as long as the nominee remains in occupation.

1.1.5 The commission is payable whether or not any tenancy agreement is finalised by Foxtons,

Again an issue of intelligibility was raised over the renewal commission clauses. Indeed one does wonder what the precise meaning of the word “nominee” would be in this context.

Intelligibility and the core — is fairness even in issue?

Regulation 6(2) states that the consideration of fairness shall not relate:

  • to the definition of the main subject matter of the contract, or
  • to the adequacy of the price or remuneration, as against the goods or services supplied in exchange.

In other words: you cannot argue that the price of that Covent Garden theatre ticket is too high, or that it is unfair that you have to watch that particular actor as part of the ensemble. There is a further caveat: regulation 6(2) does not apply to a term that is not in plain and intelligible language.

I cannot do justice to the intricate discussion of the regulation 6(2) point – I strongly urge reading the decision if this ever becomes of importance to you. In very rough summary:

The court found that the renewal commission terms (both old and new) were not in plain and intelligible language. In any event it found that none of the terms related to the main subject matter of the contract (or the adequacy of the price).

The drew the following points from Abbey National plc v Office of Fair Trading [2009] EWCA Civ 116:

  • Regulation 6 deals with things that could not be described as “core” but are rather “ancillary”.
  • The enquiry under regulation 6(2) is one of substance not of form.
  • It protects consumers against terms that the consumer will not have in focus when entering into the bargain.
  • Factors from Abbey National that were relevant included:
    • whether the obligation on the consumer was contingent;
    • whether it was mentioned in advertising material.

The court found the advertising point particularly damning:

Foxtons’ glossy brochure extols the virtues of Foxtons in relation to the activities involved in marketing the property, finding the tenant and negotiating a tenancy, apart from one page referring to managing the property. The accompanying separate leaflet on “Short term lettings” does nothing to suggest that there
will be renewals, let alone commission paid on renewals, and refers to ongoing management activities anyway. The same point can be made about its website, though the website is pretty general and of less significance in this respect.

On the question of fairness, the OFT made the point that Foxtons needed to do nothing to earn their renewal commission and the landlord might be paying a new agency a commission on top of that to Foxtons. Foxtons’ response was that they were not just introducing the tenant to the tenancy in the first place, but to the property so that every renewal was the result of their good work.

In the judge’s view it was a matter of impression but decided that the renewal commission terms were not fair. The lack of any temporal limitation, the steady increase of the commission with rent increases and the lack of any renewal service (new tenancy agreements being paid for separately) all pointed to the terms unfairness. It followed that the sale and third party commission terms were even less likely to be fair for the same reasons.

Foxtons had tried to argue that they would have to increase initial commissions in order to offset the loss created by being unable to collect renewal commission and that their business model relied on renewal commissions to maintain profitability. Despite promptings by the OFT over a considerable time, Foxtons never disclosed their model and the judge rejected this contention.

The judge made it very clear that he was not deciding that all Renewal commissions are unfair. He accepted that renewals avoid a void, but the customer doesn’t realise when contracting with Foxtons that that is being paid for.

What effect this will have on the rental market remains to be seen.

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Tales from the pink campervan

Published
by
Dave
on 19/06/2009
in Assured Shorthold tenancy, Housing law - All, Regulation and planning, assured-tenancy and secure-tenancy
. 0 Comments

The Tenants Services Authority (the new regulatory body for RSLs and, from April 2010, local authorities) has been holding a “national conversation” with tenants, touring round in a pink campervan amongst other engagement techniques. The outcome from that, and from broader regulatory conversations one suspects, is Building a New Regulatory Framework: A Discussion Paper. This is destined to be an important document when finalised – comments are due by 08 September 2009 and can be addressed to national.conversation@tsa.dsx.gov.uk – in part because of its (ir-)relevance when thinking about a jr (after Weaver) but, most significantly because of the regulatory standards it will lay down for tenants and landlords (now termed Registered providers [RPs]) as well as the general approach it sets out for the role of the TSA. Readers looking for significant hangers to clothe their jr should look elsewhere as is discussed below.

The broad basis of the TSA’s regulatory ideal is “co-regulation”, which basically means that RPs self-regulate against national standards, but that they also set local priorities as well. The justification for this approach is given at para 3.7 in particular: “The balance between direct regulation and self-regulation enables the standards framework to be more tailored to local priorities than may be possible with uniform national standards prescribed by the regulator. It also generates a degree of ownership in the framework from landlords and tenants …” This is important for two reasons: first, don’t expect to find sufficiently concrete obligations in this document to found a legitimate expectation or anything similar; second, the places to look will be in local or national frameworks produced by RPs as well as the various sub-regulations (through Circulars, Codes etc) produced by the TSA. The TSA also makes a plea for time for the new framework to bed in. A tension throughout the document is the relation between national and local standards (para 4.10 & 4.30).

The TSA role is a long-stop “… when there is a failure to meet a national standard or if a local standard agreed with tenants falls within the regulatory framework” (para 3.2). Personally, I have always been dubious about co-regulation which is an academic concept dreamt up in ivory towers without considering the sensitivity of the interplay between the regulatory partners. Hence, I’m not sure that I buy into the vision of co-regulation as encouraging “… landlords and tenants to engage together with a shared aspiration of improving the standard of service delivery”, which then delimits the TSA’s regulatory activity (para 3.5). This co-regulation is risk-based – following a similar model to that of, for example, the FSA, with “Senior Risk and Assurance Managers” leading – and the assessment of risk will “… determine proportionate, targeted and consistent use of our limited resources” (para 3.15). The focus of the TSA regulation is finance and governance but will also be “outcome-based”, so input processes are less important.

The point about co-regulation in this context is that it offers a way of reducing the direct involvement of the TSA in monitoring compliance (para 5.2). Information to be collated by the TSA will be such as “… enables it to establish an acceptable minimum level of confidence about landlords and the social housing sector as a whole” (para 5.12). This is, of course, in line with the broader approach of government to reduce the reporting obligations and number of PIs.

The TSA have a difficult role, not just because of the diverse nature of the bodies they are to regulate, but also because of the increasingly crowded regulatory space, and most particularly the fact that RPs are generally in hock to private lenders. Thus, it is no surprise that one of the underlying purposes of regulation is a recognition of the importance of an effective regulatory regime to private sector investors in social housing (para 3.3).

The documents sets out three types of national standards which will form the basis for the TSA’s performance assessment of RPs: how social housing is provided; the financial viability and governance of non-local authority RPs; and the economic, efficient and effective delivery of services (the three Es). CLG is shortly to issue its own consultation on the directions it proposes to give to the TSA. The TSA will shortly itself issue formal guidance and amplify its national standards by reference to Codes of Practice (which will be further places to look for compliance).

There then follow six themes that form the subject of the standards: the service offer to tenants; tenant empowerment and involvement; the tenancy agreement; governance; viability; value for money. Each has sub-themes. To give an example of what was meant above about the broad nature of the standards, that for anti-social behaviour and security (at para 4.64) reads as follows: to “‘ensure that providers take a comprehensive approach to tackling and preventing anti-social behaviour and, that tenants feel that their landlords are taking action to deal with persistent nuisance.” Repairs and maintenance (para 4.54) counterbalances “the seriousness of the disrepair and its significance to the occupier” with the three Es. What can be said about these standards is that the TSA has really sought to live up to its name and counterbalance the different actors in the regulatory space paying attention to tenants’ needs and wants where they were rather ignored by the previous regime (or, at least, arguably so).

The two issues uppermost in my mind, particularly after Weaver (on which more to come later), are about tenure and allocations (paras 4.94-4.107). But don’t expect anything enlightening here either. As regards tenure, the proposal is that landlords “issue the most appropriate form of tenancy for the type of accommodation and tenant” (para 4.96) which, of course, facilitates the use of the so-called starter tenancy. As regards RPs’ policy and management of tenancy agreements – including eviction policies – a consultation question which will be of interest to readers is asked as follows:

The current housing associations’ Regulatory Good Practice Note on tenure does not cover these issues, and we would welcome views on whether to continue with this approach or to extend the scope of the national tenure standard beyond issues relating to security of tenure.
4.101 We are interested in exploring how an element of local flexibility could be supported through a more detailed Code of Practice on tenure.

As regards allocations, there is little here of value in truth. It is all about delivering CLG policy on choice and sustainability, in an environment which relies on locally negotiated agreements. There are comments here about the expectation that RPs will work with local authorities “… in respect of their strategic housing function to make sure that a proper balance is struck in ensuring that the interests of different groups are incorporated in local offers” (para 4.106).

Other key issues for afficionados of this kind of stuff are as follows

  • The TSA is to issue guidance on how they will deal with complaints about landlords and the extent to which they will accept complaints from tenants (the tenant trigger) (paras 5.22-5.36)
  • how to “incentivise” better performance (including working with the Audit Commission inspection regime)
  • powers of intervention on which a “framework document” and detailed guidance notes will shortly be consulted

    • Chapter 7 is where we get to the heart of the political issue about registration of private profit-making companies. This is a battle that has already been lost or won (depending on your standpoint), partly because Cave accepted the watering down of the nature of the sector. The only remaining question, on which the TSA currently has no view, is as to the criteria for registration. Reading between the lines, it looks like they will go for the minimum.

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    Regulating renting proposals

    Published
    by
    Dave
    on 13/05/2009
    in Assured Shorthold tenancy, Housing law - All and Regulation and planning
    . 5 Comments

    I’m just in the process of marking what feels like thousands of coursework essays on proprietary estoppel and constructive trusts.  The thing that gets me – time for a rant – is that my very clever three As students can’t actually write a proper sentence, and split infinitives willy nilly.  It just winds me up.  So I turned to the much pre-publicised DCLoG response to the Rugg review of private renting which was published today. You can rely on DCLoG civil servants, or so I thought, but what lingers with me after reading it is that it could have been written by one of those very same students because it’s been incredibly badly put together and edited.

    I focus on that in a way because the general view (or at least a straw poll of some of my policy nerd friends) is that the content is just a load of old flannel.  There’s not much there that we didn’t know about already – a light touch landlord registration scheme, regulation of letting and managing agents, written tenancy agreements, a kind of attempt at dealing with retaliatory eviction (about which we really don’t know anything but the policy focus on this is down to the amazing, saintly work of Debbie Crew and the CABx), promotion of local authority-landlord schemes to assist the vulnerable (ie shove all homeless households into private renting as “choice”), and sundry other items.  The Law Commission stuff is largely sidelined on the basis that this isn’t the right time for such an upheaval and because of the additional regulatory burdens – bla bla, I’m afraid I just think that’s just a load of old guff written by people who should know better (and who are responsible as a result for the mess we’re in, or potentially in, on Ground 8 and the HRA).  There’s nothing there really about tenancy deposits either – given the current uncertainty in the law as we have reported on several occasions and appears to be the stuff of much blogging -apart from a self-laudatory comment about the amount of deposits which have been protected through the 2004 Act schemes.

    Three further rants:

    (a) It annoys me that local authorities and landlords are now regarded as partners and accreditors etc, rather than local authorities as regulators and prosecutors.  I strongly recommend that DCLoG civil servants read the meticulous work of Keith Hawkins and indeed their own research on harassment/unlawful eviction from 1999 to appreciate the way prosecution is not used against the worst offenders.

    (b) My co-researcher keeps on going on about the way government sidles up to the landlord community always saying that we know that there are many good landlords out there.  But, we don’t know that, nor do we know what we mean by “good” in this context, nor whether sometimes the good might also be bad. 

    (c) I read this document from start to finish so I could write this.  They repaid me with the comment in their concluding section: “We see consultation on these proposals as the start of a long conversation with all who have an interest in the private rented sector and the proposals in this response”.  In other words, don’t expect any action on these proposals beyond meek, mediocre, unpoliced self-regulation.

    Ah well, I feel better after those rants – back to proprietary estoppel and constructive trusts and the madness of marking.

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    Green Paper "within 10 days"

    Published
    by
    Dave
    on 05/05/2009
    in Assured Shorthold tenancy, Housing law - All and Regulation and planning
    . 0 Comments

    It’s the little things in life which get me excited and, as a bit of a policy nerd on the side, it looks like a Green Paper is to be expected within 10 days if The Times is to be believed. I’d heard on the grapevine that the GP had been canned because they couldn’t make up their minds what to do. My sources are usually good, but this time (again, if The Times is to be believed) ahem mistaken. According to The Times article, it’s going to suggest mandatory licensing for private landlords on the basis of the Rugg report (discussed by us here) (and the forgotten Jones report, discussed by us here). The article also makes the following comment about enforcement, perhaps also dealing with retaliatory eviction (although this is a little unclear):

    The system would be monitored by an independent body to adjudicate complaints made by tenants. If these complaints were upheld the landlord could lose his or her letting licence. Under one option being considered, the Government might set up a “social letting agent” to place affected tenants in more suitable privately rented accommodation.

    I had heard that some elements of the Law Commission work might also be included, but we’ll just have to wait and see. Given the significance attached to the 2000 Green Paper by the House of Lords in Ahmad, these things are no longer of purely esoteric interest. Anyway, much excitement …

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    Not another review …

    Published
    by
    Dave
    on 22/01/2009
    in Assured Shorthold tenancy, Housing law - All and Regulation and planning
    . 0 Comments

    Yes, it’s true, another review has been published, this time of the regulation and redress in the UK housing market. And yes, if you’re wondering, this was what the Law Commission did in their Issues paper on proportionate dispute resolution and further analysis. The author this time is Professor Colin Jones, whose biog does not suggest that he has ever been particularly interested, if at all, in this issue although that may be a little unfair. Actually, what he has done here is quite respectable to a point and worthy (in contrast to the disastrous Rugg and Rhodes report – for our review, see here).

    Prof Jones has mapped out the complex, diverse accountability space (as the Law Commission put it) and – shock, horror – has demonstrated that: it is too complex; needs to improve its transparency and be universal; needs to have a single web gateway to complaints schemes; and certain elements of self-regulation need beefing up to be compatible with principles of natural justice (eg estate agents redress schemes). Most particularly – shock, horror again – he notes that lettings and management agencies have no, or insufficient, mechanisms for aggrieved occupiers to claim redress, and suggests that they should come within the provisions of the Consumers, Estate Agents and Redress Act 2007 (which was the derivation of this inquiry). None of this is startling or new, as implied, but he does map out the different schemes which currently operate against a set of “natural justice” criteria borrowed from the OFT and that is interesting because some schemes are found wanting against that set of criteria. He also seeks and claims to demonstrate from pretty rough and ready statistics levels of dissatisfaction primarily with estate agents, and the private rented sector.

    He makes some strong criticisms of existing mechanisms, which are likely to chime with those experienced in these fields. eg

    The complexities of regulation of private landlords mean that they can be subject to registration, licensing or accreditation schemes that can vary by location and status. Trhe result is that the meaning of these terms has become stretched and difficult for a housing professional, never mind a lay person, to comprehend the layer differences

    But my favourite is this:

    [The changing landscape of redress in the housing market] is likely to cause some confusion for customers although there is no evidence to demonstrate there is a problem. The system may not be a maze if you are in it but to the outsider looking in it seems unnecessarily complex with consequent fears of a lack of consumer confidence and opportunities for unscrupulous practice.

    So that’s what’s good. But, it’s disappointing after all that work that the Law Commission did in developing criteria to judge dispute resolution mechanisms to find it written out (and not referred to). It’s also disappointing that sometimes in the crucial chapters on consumers’ views that Prof Jones often equates dissatisfaction with grievance. Those with a passing interest in the disputing literature are likely to shake their heads at this point.

    But really, the basis for the assertion of high levels of dissatisfaction is, as Prof Jones accepts at one point (para 7.2), unclear. As this is so important in our consumer focused world, it is the most disappointing part of the report. So, for example, at para 7.11, he states that “the [Ombudsman for Estate Agents] statistics suggest that as relatively few make a formal complaint to the organisation either this is quite a low level unhappiness, perhaps niggling concerns, or there is a lack of awareness of consumer rights or a lack of confidence in the process”. The assertion is that there are high levels of dissatisfaction and low levels of complaint. The data sources for each are limited, and there is no discussion of the key issues – the transformation of grievance to dispute as well as the role of (and access to) professionals in that process. I don’t necessarily blame Prof Jones for this, but I do blame CLG and BERR who commissioned the report.

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    On the Naughty Step

    Published
    by
    NL
    on 08/10/2008
    in Assured Shorthold tenancy, Housing law - All and Possession
    . 7 Comments

    Very firmly esconsed on the step are Sutton Estates, managing agents on Merseyside. These charmers came up with the idea of putting notice boards outside the homes of tenants in rent arrears, proclaiming it to be the home of a ‘rent dodger’. Sutton Estates believe this to be an effective and reasonable way of getting people to pay their arrears. Perhaps sensing that some people might be a little, how can I put it, ‘unhappy’ about this approach, one landlord, Pat Slattery, whose property is managed by Sutton said “It’s not a medieval witch-hunt. The signs will not apply to hardship cases, but there are people who take the rent paid to them by the Government and do not pass it on”.

    Sutton’s managing director, Mr Heffey, took a rather more robust view, saying “They can avoid us, but not their neighbours. Now, every time they walk in and out of their door, the neighbours will be laughing at them”. And, in fact, it turns out that people suffering genuine hardship would end up with a sign attached to their home, as Mr Heffey said “For someone who calls us, explains that they are having problems, we would not persevere with this if they are suffering difficulties.” So they get the sign put up, then have to call the managing agents, begging them to take it down.

    Now comes the fun bit. Just how many offences are Sutton Estates/the landlord committing here?

    Libel and/or harassment have been raised, as have incitement to assault and breach of Art 8 privacy. I’d add breach of covenant of quiet enjoyment and possible breach of data protection rules. Any other suggestions?

    Any readers in the north west fancy bringing this nonsense to an end? I reckon it could be done on a CFA, if not legal aid.

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    So what

    Published
    by
    Dave
    on 20/08/2008
    in Assured Shorthold tenancy, Housing law - All and Regulation and planning
    . 4 Comments

    Seven and a half years on, the Law Commission has now completed its work on the reform of housing law with the publication of its final report, Housing: Encouraging Responsible Letting. The Consultation Paper, on which this report is based, voted in favour of a scheme of enforced self-regulation, a scheme with some bite. That has been dropped in this report which now makes various tinkering suggestions such as a national private landlord accreditation scheme and a single code of good housing management practice. The one solid proposal with which everyone can agree (presumably) is the need for a proper regulatory scheme for letting agents. Their major proposal is for the appointment of a housing standards monitor, which sounds a bit school-like. This monitor would have no power beyond the promotion of standards in the sector, to trial various schemes such as a “home condition certificate” (like an mot for private rented property) and development of ADR. It doesn’t have power to do anything about bad standards.

    This package of proposals is what the Commission terms “smart regulation” and is designed to include private landlords within that framework (eg through a “stakeholder board”). It all sounds so wonderfully modern, so third way New Labourish, so ultimately ineffective. Whenever policy-makers, including the Law Commission, talk of the private rented sector, there is a mantra that they have to acknowledge that there are many good landlords. That’s fine of course, although we may have a different view on that, but that doesn’t mean that you devise your scheme at the highest denominator. Equally, nobody ever says what a “good landlord” is – do these landlords have to be good all the time or just some of it? I like to think I’m a good cyclist but have been known to lose it when cut up by an arrogant driver. Is a good landlord somebody who refuses to let a property to somebody on housing benefit or gives a tenant notice when the tenant goes on benefits? I could go on.

    So what now?  Well, the truth is that, despite many trees being cut down to cater for the Law Commission’s output and the fact that their terms of reference came from the government itself, the government appears to have forgotten about the Law Commission’s work (or, at best, sidelined it). We can all take views about their work, but the fact is that their proposals amount to the only rigorous, sustained treatment and reform of housing law that (I guess) we all feel is necessary. But, nothing has been done and nothing is likely to be done either. Take this responsible letting report – the government must have known (or can be taken to have known) that the Law Commission were doing this work, but they (pre-Flint) commissioned some academics at York to do the same job. The Law Commission had to get their report out now so that it pre-dated that review.

    Rather than “so what now”, the question for the Law Commission after seven and a half years is “so what”?  And that must be pretty depressing.

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