Tag Archive for 'private tenancy'

"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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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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Councils bribing tenants shock!

Published
by
NL
on 07/02/2009
in Housing law - All and secure-tenancy
. 0 Comments

In apparent confirmation both that the Times is now a tabloid newspaper and that today was a quiet news day, this was the lead story in Saturday’s Times.

I’ll just quote the opening sentence:

Council tenants are being offered £30,000 bribes or cottages by the sea to vacate their homes for credit crunch victims as Britain faces a critical social housing shortage.

The only accurate part of that is the social housing shortage. Funny how that only becomes news when Times readers are getting worried they might need social housing themselves. Nonetheless, there is a critical social housing shortage and it is a serious issue. Sadly not one the Times felt able to actually deal with.

The whole tenor of the piece is that LAs are frantically bribing tenants with tens of thousands of pounds in order to clear space for credit crunch casualties. Of course the casualties will usually be so far down the priority scale on a Part VI application, they may as well wait for the end of the recession and buy their repossessed property back. Perhaps LAs are anticipating that their homeless prevention services will be breached, resulting in a flood of homeless applications…

Apparently, payments for transferring to a smaller property for ‘underoccupiers’ are to be considered as bribes. This is quite unlike proposals to support those in trouble with their mortgages by buying part or all of their property and letting them remain as, in part or whole, social tenants. That is merely support, or prevention, or doing the right thing.

I haven’t come across the payments to leave a secure tenancy and go to the private sector, apparently operated by Westminster, Kensington & Chelsea and a number of other Councils. Westminster apparently adds a condition that the (ex) tenant will not be rehoused again should they become homeless. In ignorance of any details, my first impression is that I’m not sure that that would stand up to challenge – can one sign away the LA’s Part VII duties in a private contract? I could also see the criteria and procedure by which the LA assess the tenant’s suitability for such an offer as being open to challenge, or even falling under consumer contract terms regulations.

The article’s quote from the Taxpayers’ Alliance is merely dimwitted, but for real if inadvertent humour, one has to head to the readers’ comments. These are people scandalised, nay horrified, at the ridiculous waste of taxpayer’s money on such scroungers, when the money could be better spent on, well, subsidising their own mortgage payments.

But the main article set the tone to follow. Truly dreadful, cynical and lazy work by Jill Sherman and Fiona Hamilton – those being the names on the byline – and obviously by the editors.

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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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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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Catching up – s.21 and tenants' deposits

Published
by
NL
on 04/09/2007
in Assured Shorthold tenancy and Housing law - All
. 0 Comments

A very interesting article by Francis Davey in September’s Legal Action about the Housing Act 2004. The whole piece rewards a read, but two bits caught my eye. We don’t do that many private tenancy possession defences, relatively speaking, so these were new to me.

Where a shorthold assured tenancy started after 6 April 2007, i) the deposit must be held by the landlord in one of the approved tenancy deposit schemes, within 14 days of receiving it and ii) the landlord is to give prescribed information about this to the tenant.

Now, where the landlord fails to do either or both of these, the landlord may not give a HA 1988 s.21 Notice. Any putative notice served is invalid, even if the landlord then later complies with the scheme. The landlord will have to serve a fresh s.21 after complying. Moreover, any s.21 Notice signed at the beginning of the tenancy, or with the tenancy agreement (as very many are) is invalid, as the deposit is not (yet) held in compliance with the scheme and the requisite information not (yet) provided to the tenant.

Sadly this only applies to deposits paid after 6 April, so older tenancies, even where renewed after that date, will not fall under it unless a fresh deposit is paid. [Edit. This is now open to question. It is probable that a new tenancy with a 'roll-over' deposit will require the deposit to be placed in a scheme, with the above consequences. A shorthold assured that has become a periodic tenancy - with no new tenancy agreement - won't be caught.]

Also, where the landlord has failed to comply, the tenant has a claim or counterclaim, with a mandatory award to the tenant of three times the deposit if the landlord has not complied by the hearing. Potentially very useful in a rent arrears possession.

Two things to be added to the list to check with private tenant cases. There is much more in the article…

[For all tenancy deposit case posts click here]

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Waxed Moustaches

Published
by
NL
on 13/06/2007
in Assured Shorthold tenancy, Disrepair, Housing law - All and Possession
. 0 Comments

I caught someone from the National Citizens Advice Bureau on BBC Breakfast this morning, commenting on a CAB report on the large number of people in private rented properties in bad condition who are promptly evicted if they complain or do anything about the disrepair.

Anecdotally, I’d certainly support this. We do hear from quite a few private tenants who have received notice or possession orders after raising repairs, or getting an inspection by the local authority environmental health. Often these people have been living in deadful conditions with only silence or worse from the landlord.

As the CAB spokeswoman pointed out, there is little or nothing to stop this happening once the fixed period of an assured shorthold has elapsed. Apparently, Australia has some form of protection from eviction while disrepair issues are underway. I’ll try to find out about this – could be interesting.

moustache.pngAs it is, English tenants can only hope that their landlord is dim or greedy, because if the landlord goes the s.21/accelerated possession route, there is nothing they can do to prevent or delay possession if they are out of the fixed period. A separate claim for disrepair is possible, but always tricky when the ex-tenant is out of the property.

If the landlord is greedy, and if there are rent arrears, the tenant may be luckier. A possession claim on the basis of section 8 and/or 11 and 12 – all rent arrears of some form – presents the possibility of a disrepair counterclaim. This will certainly delay possession and, if the damages are enough to wipe out the arrears, put paid to the possession claim. The landlord will have to start afresh with a s.21 procedure, as one can’t run two possession claims side by side or amend the claim to insert grounds that weren’t in the Notice.

We had a case like this some months ago. Greedy or ill-advised landlord (because they were represented) made a s.8 claim for possession, after being served with a works order by the council once the client/tenant got Environmental Health in. The client, luckily, came to us. The rent arrears were substantial, but the disrepair significant. An immediate disrepair counterclaim was served. Of course, the matter then took many months to get to final hearing, and the result was that the damages more than cleared the arrears, possession claim dismissed, and the client had a grand or two over coming in damages and an enforceable order for repairs. We got costs…

But these are the very lucky exceptions. The CAB are calling for tenancy safeguards in these situations. It is, of course, a good idea, but frankly I can’t see any legislation happening soon. Everything will likely be put on hold pending the final report of the Law Commission review of housing law, which will be along in…a bit.

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