Does failing to be licensed under The Housing (Wales) Act 2014 prevent a landlord from serving any notice seeking possession, or just a section 21 notice? That was the issue in a county court appeal in Evans & Evans v Jarvis, County Court at Swansea, 20 August 2019 (unreported elsewhere, I’ve seen a note of judgment.)
The Evans were the assured shorthold tenants of Mr Jarvis. Substantial rent arrears had accrued and on 15 December 2018, Mr J served a section 8 notice. Possession proceedings were then brought on the basis of that notice. At first instance, possession had been given and a late appeal was brought (with permission) by the Evans.
The basis of the appeal was that Mr J had not been licensed as a landlord under the national licensing scheme at the time of serving the notice and that the notice was therefore invalid.
Mr J admitted that he was not personally licensed at that time, though his company was (but the company was not the landlord here), and he had subsequently become licensed on 22 July 2019 – shortly before this hearing.
However, Mr J argued that the Housing (Wales) Act 2014 does not mention Section 8 notices and therefore does not specify any requirement for those serving such notices to register or be licensed. Section 44 invalidates a section 21 notice if certain criteria not met and it is argued that this does not apply to Section 8 notice. Mr J referred to the Rent Smart Wales website, which he said says that the scheme does not restrict ability of landlords to issue a section 8 notice.
The Evans argued that section 7 H(W)A provides at Section 7(1)
The landlord of a dwelling subject to a domestic tenancy must not do any of the things described in subsection (2) in respect of the dwelling unless – (a) the landlord is licenced to do so under this Part for the area in which the dwelling is located…”
Subsection (2) includes ‘serving notice to terminate a tenancy’.
There was nothing that excluded section 8 notices, they were simply not expressly mentioned. The mention of section 21 at section 44 of the H(W)A was distinct.
Further, any statements on the Rent Smart Wales website were not in any way binding on the court.
HHJ Garland Thomas held that he was satisfied that Section 8 is a notice within section 7 of the H(W)A, the Act was brought into effect, or these sections, to protect tenants who were unregistered or unlicensed, and there is no reason why Section 8 should not come within that act. There is nothing which excludes Section 8, it is simply that it is not mentioned. However the wording of Section 7 is clear and it is clear that the Landlord of a dwelling subject of a domestic tenancy cannot serve notice to terminate tenancy: it is not qualified in any way.
Appeal allowed, with conditions on payment of rent and contribution to arrears.
My thanks to Civitas Law for the note of judgment.
Had the landlord applied for a licence first, both a S21 and a S8 would have been valid. But does it make a difference if the licence is subsequently refused either before the hearing or just afterwards in time for an appeal? It would seem to be a gaping hole in the legislation if any old rogue can still legally evict a tenant simply by applying for a licence even if he knows he’d be found not to be a “fit and proper person” and would therefore ultimately be refused that licence.
My reading is you have to have a licence or use a licensed agent at the time of service of notice. Fleri v Evans is authority that the landlord has to be registered at time of service of the notice. The n5b wales prompts for this information.
Section 8 applies:
The requirements in sections 6(1), 7(1) and 7(3) do not apply—
(a)if the landlord has applied to the licensing authority to be licensed, for the period from the date of the application until it is determined by the authority or (if the authority refuses the application) until all means of appealing against a decision to refuse an application have been exhausted and the decision is upheld;
So an application would be sufficient to permit service of notice, I think.
It sounds like the landlord could apply for the licence, be refused, appeal the refusal and eventually get still get refused, but as long as this bureaucratic council process was not complete by the time the tenant appealed the possession order the tenant could end up being evicted by the crookedest of rogue landlords under this licensing scheme. Yet the council wonder why tenants aren’t forthcoming with incriminating info about dodgy landlords.
Something that puzzles me about the case in question here:- the court required the tenant to pay the arrears- if they deemed the S8 invalid due to the Act why did they nevertheless choose to enforce payment? Why were they able to effectively collect rent on behalf of the landlord – he is not allowed to collect rent himself under the Act (though I presume this is not the same as not being entitled to it), nor is an unlicensed agent allowed to collect it on his behalf – can the court act as if they are a licensed agent,i.e. are courts always assumed to be above any licence requirements?
Another curiosity that arises – according to the Rent Smart Wales website an unlicensed landlord cannot collect rent nor evict a tenant, neither can an unlicensed agent collect rent, but it does specifically state that an authorised agent, even without a licence, can nevertheless evict a tenant. This seems to give the agent more power than the landlord, uness the website has simply made a mistake.
If the application process was underway, then as far as I can see, the notice seeking possession would be valid. I don’t think this is a huge issue, as the number of times that could be played out by a rogue landlord would be very limited.
On the contribution to arrears, reading between the lines, this was offered up by the tenant, and the court recorded that commitment. I presume that the s.8 possession claim also included a money claim for the arrears, and the setting aside of the possession order would not change that. Of course the payment is to the landlord, not the court.
As far as I can see, the agent doesn’t have to be licensed can serve notice. But this is because they are doing it as the landlord’s agents, on the landlord’s behalf. Agents can’t evict tenants. So the landlord would have to be licensed for the notice to be valid.
“….also included a money claim for the arrears,” The Act specifically excludes the landlord from collecting rent.
Would a money claim nevertheless be valid on the basis that because the landlord could not legally collect the rent the rent became money lawfully due but outstanding and therefore could now be collected as a debt rather than as “rent”?
“So the landlord would have to be licensed for the notice to be valid.” Interesting point.
The landlord was licensed by the time of the hearing. I’d say strongly arguable could then recover pre license arrears. No being able to ‘collect’ rent is not the same as rent not being due.
Agree on the rent and arrears being due, as I’m sure ‘I read somewhere that a rental agreement can exist between any two people regardless of the legitimacy (though a squatter trying to clam arrears from another squatter via the court would be something I’d like to see happen in practice rather than just in theory!).
If the licence had not been obtained the landlord would be in a peculiar position of being owed rent (and interest, perhaps) yet unable to collect it. This is reminiscent of a landlord who had failed to supply his name and address to the tenant, but is entitled to all the back-rent once he does so. The difference here is that if the tenant could somehow goad the landlord into assaulting him, thus making himself no longer a “fit and proper person”, the licence could be revoked (assume this happens prior to any hearing) and the tenant would owe the rent to someone who could never collect it. Would it be a simple matter for the landlord to use a licenced agent in his place or can only the landlord himself take court action on arrears if the tenant refuses to pay the licensed agent?
I’ll make that my final “thought experiment” on the matter.
Only the landlord. Though the landlord would have ample time to take action before any revocation. Besides, if there is a licensed agent, they can collect the rent. I think an unlicensed landlord could still bring a claim for arrears in that situation, as there is someone entitled to collect the rent. (I will confess I have not dug deeply into the Regs, but that is on first appearance).