Covid-19

On 26 March 2020 the Coronavirus Act 2020 (“Act”) came into force. Several amendments to the legislation and court rules for possession proceedings have since been implemented. Most recently, the Housing Minister confirmed that the current stay on proceedings will be lifted on 23 August 2020. The latest practice direction (Practice Direction 55C) has now been published and sets out the procedure for progressing claims from 23 August 2020.

As the situation continues to change, we are regularly reviewing the advice we give to our clients. Below is a summary of guidance for landlords under the current legislation:

Can I still serve notice on my tenant(s)?

Yes. The Act simply states that from 26 March 2020 all notices seeking possession (this applies to both section 8 and section 21 notices) must give tenants at least 3 months’ notice. For Welsh landlords, however, as of 24 July 2020 all notices must give tenants at least 6 months’ notice. Landlords can therefore still serve notice on their tenants provided the usual criteria for doing so are met. Landlords can also still issue claims for possession once those notices expire if the tenants have failed to leave. For notices served on rent arrears grounds, please see below for further information.

What about demanding rent from my tenant(s)?

Tenants will remain liable for any rent falling due during this current crisis, although landlords have been advised to negotiate with their tenants on a case-by-case basis to ideally reach a repayment plan of some sort. In practice, we appreciate that many landlords have a difficult relationship with their tenants at the best of times and of course there is no guarantee that any such agreements will be honoured. Please also read “Should I try and mediate with my tenant(s)?” below.

The grounds for serving a section 8 notice due to rent arrears have otherwise not changed. If your tenant owes at least 2 months/8 weeks rent, and a repayment agreement is not feasible, we recommend serving a section 8 notice.

Should I try and mediate with my tenant(s)?

Landlords have been advised to try and reach an agreement with their tenants on any concerns or difficulties surrounding rent. For instance, tenants may request a temporary rent reduction or there may already be rent arrears that need addressing.

Whilst it is merely ‘advised’ at the moment, we are of the opinion that the courts will ultimately take any mediation attempts into consideration when they come to granting possession orders. We are therefore offering all landlords a mediation package service whereby we will aim to negotiate on their behalf a formal repayment agreement with their tenants.

My possession notice has expired, can I issue a claim?

Additional guidance on the eviction process has since been published by the Ministry of Housing and the Ministry of Justice. In summary, whilst landlords are legally able to commence eviction action against their tenants, there are procedural and logistical issues to consider when doing so. In particular, the courts are expected to be dealing with a significant backlog of cases and the standard period between a claim being issued and a hearing date (usually 4-8 weeks) has been temporarily suspended following the implementation of Practice Direction 55C on 23 August 2020.

Due to these expected delays in court processes, we are advising clients to progress their claims as soon as possible by issuing them with the court. Having said that, landlords should note that issuing a claim before 03 August 2020 will mean that they will have to also submit a ‘reactivation notice’ in line with the new Practice Direction 55C in order for their claim to progress. Claims issued after 03 August are not subject to this requirement. Further information on ‘reactivation notices’ is provided below under “What will happen to my claim that is already with the court?”

Is the notice I served on my tenant(s) before the Coronavirus Act still valid?

Yes, provided all the usual criteria for serving that notice were met beforehand. There is no need to serve a new notice simply to comply with the new 3 months’ (or 6 months’) notice rule.

For landlords whose properties are in England, if you have served a section 21 notice, please be mindful that these have a 6 month ‘shelf-life’. This means that a claim would need to be issued with the court within 6 months from the date of that notice. Failure to do so will necessitate a new section 21 notice being served.

For landlords whose properties are in Wales, if you served a notice (either section 8 or section 21) before 24 July 2020 then these will remain valid. However, if you served a notice after 24 July 2020 then this must comply with the new rule that all notices must give at least 6 months’ notice. Section 21 notices served in Wales are not generally subject to the 6-month ‘shelf-life’ mentioned above. If you are concerned about any of the new rules please do get in touch with us.

What will happen to my claim that is already with the court?

Your claim will remain with the court and will be progressed once the stay on proceedings is lifted on 23 August 2020. The new Practice Direction 55C also comes into effect on 23 August and it is this which will dictate how your claim is progressed depending on (1) when your claim was issued with the court and (2) what stage your claim is currently at.

Claims issued with the court before 03 August 2020 (and where no possession order has yet been granted) will require landlords to file a ‘reactivation notice’ in order for their claim to progress. Practice Direction 55C states that ‘reactivation notices’ must include the following information:-

• Confirmation that the party filing and serving the ‘reactivation notice’ wishes for the case to be heard, listed/re-listed for a hearing or referred to a judge; and
• Set out what knowledge that party has as to the effect of the Coronavirus pandemic on the Defendant and their dependants.
• (Where a claim for rent arrears is being made, an updated rent account must also be submitted covering the last 2 years)

A ‘reactivation notice’ is not required in cases that have been issued after 03 August or where a final possession order has already been made. Additional information regarding any known impact of the COVID-19 pandemic on your tenant(s) will, however, still need to be included with your claim.

How long will the eviction process take now?

If your case requires a ‘reactivation notice’ in order to proceed, the courts should progress it as soon as possible after 23 August. Unfortunately, the backlog of cases since the start of the pandemic means that delays are to be expected. The extent of those delays will naturally vary between courts due to differences in caseload and size. Court hearings should ordinarily be listed to take place within 4-8 weeks of a claim being issued, however this rule has been temporarily suspended under Practice Direction 5C. Courts are, however, required to give parties’ at least 21 days’ notice of any new hearing date.

Claims where no court hearing is required (namely, Accelerated Procedure claims) are expected to remain the faster option albeit still subject to delays.

Where a final possession order has already been granted, this will still be valid and a bailiff application can be made to the court after 23 August. Similarly, if you are already waiting for a bailiff appointment, this will be actioned by the court’s bailiff department after 23 August. Please note that bailiffs have been off the road for several months and so will also be experiencing a significant backlog of cases which, again, will vary from area to area.

Are there any protections for landlords?

Landlords are still entitled to demand rent from their tenants and also to progress eviction action even where there are no arrears (section 21). There has previously been some suggestion from the Government about abolishing section 21, however there has been no further noise on this point as yet.

Many landlords nevertheless still face the worrying prospect of tenants failing to pay any rent and there are clear concerns over how long this situation could go on for. ‘Mortgage holidays’ are available in relation to buy-to-let mortgages. We strongly advise any landlords with concerns over their rented property’s mortgage payments to contact their mortgage provider as a matter of urgency and discuss applying for a ‘mortgage holiday’. Mortgage providers are under instruction to act in a fair, reasonable and compassionate way to any mortgagor struggling with repayments.

Are further changes to my position likely?

The new Practice Direction 55C will remain in force from 23 August 2020 until 28 March 2021. Any further amendments to court practice rules will likely be reviewed towards the end of this period. In the meantime, the courts will continue to implement procedural guidance to their staff as appropriate.

As for legislation, the Act itself is required to be reviewed by Parliament every 6 months. There has already been some prominent criticism of the Government’s approach to private rented housing. It is therefore possible that further amendments will be enacted to address these concerns. It is also possible, however, that any changes will simply be made as part of general advice or practice directions.

We will update this guidance following any further amendments to legislation and/or the Civil Procedure Rules as they come through.