Here is a question to the blog clinic from Ronald (not his real name).
In Caridon Property Ltd v Monty Shooltz HHJ Luba QC ruled that the section 21 notice was invalid due to the landlord’s failure to serve a landlord’s gas safety record on the tenants before they moved in (as per your post here).
This has created difficulties in a large number of situations where the landlord cannot prove service of the landlord’s gas safety record & EPC prior to the tenant taking up occupation. There is now a class of properties where the landlord cannot serve a valid Section 21 Notice (as the initial failure to serve the right certificates cannot be put right by serving the documents later).
Is there any prospect of this ruling – or the legislation – being looked at afresh? I note that Regulation 5 of The Assured Shorthold Tenancy Notices and Prescribed Requirements (England) Regulations 2015 requires the Secretary of State to review and report on the operation of the Regulations at least every 5 years (with the first such report due by no later than 1/10/2020). Have you heard anything relating to the Secretary of State actually doing this, and if so what are the prospects of the requirement to serve the LGSR/EPC being changed?
Answer
You are right, this case has caused huge problems and many tenancies are now effectively (unless this ruling is overturned) assured rather than assured shorthold tenancies.
This was not the government’s intention when they drafted and passed the legislation. However, it looks unlikely that anything will be done about it in the immediate future or maybe at all.
It takes time to correct defective legislation. It took around two years for the Superstrike issue to be addressed for example.
However, I have heard on the grapevine that this government has no intention of doing anything about this. But even if they wanted to, Brexit is taking up all their time and slowing everything else up.
Chances of change
Probably the best chance of getting the ruling overturned is for someone to fund a similar case to the Court of Appeal or even the Supreme Court. I have spoken to barristers who consider that the Caridon Property case is wrongly decided and it is possible that a higher court would come to a different decision.
I think though that the chances of this though are quite slim as most people seem to think the Caridon Property decision is correct on the law. Personally, I think that the likelihood of the decision being overturned is probably about 40% If not less.
It is also always possible that if there was a lot of adverse publicity in the press, the government might change their mind and introduce corrective legislation. Government are more influenced by the press than most people realise. For example, after an expose in the Guardian, Mrs May is now saying that the ‘rogue landlord’ database will be open to tenants.
Landlords being unable to evict tenants where they have failed to comply properly with the gas safety rules is not through a topic that is likely to get any public sympathy. Realistically the chances of this happening are remote.
So we are left with the current unsatisfactory situation.
Advice to landlords
My advice to landlords with pre-October 2015 tenancies who cannot prove that they gave a gas safety certificate to tenants before they moved in, is to leave the tenancy as a periodic one.
The requirement to serve a gas safety certificate as a condition of serving a valid section 21 notice ONLY applies to post 30 Septemeber 2015 tenancies. So if your tenancy started before then and now just runs on as a periodic tenancy it will not apply to you.
But as soon as you issue a new tenancy or renewal form you have a problem. So don’t do it. You can deal with any rent increases via the statutory notice procedure.
Then you should be safe.
Does this apply to other non performance issues or just the gas and EPC ones?
In homelessness law there was a similar headache over unclear and contradictory wording with a thing called ‘Appendix FM’. Government acknowledged the problem in 2012 but it didnt get corrected until 2016, so in the meantime so many landlords are going to get caught by this, which even I, as a rogue landlord enforcement officer and lay defence advocate in possession claims thinks is a bit steep
Let’s be clear on one thing – for tenants S21 is the bane of the rental market, leaving them vulnerable to revenge evictions and defenceless against greedy rent increases. The best behaved LLs who comply with all the required rules, sometimes at great expense to themselves, earn the luxury of being able to use S21, whereas the dodgy corner-cutters that charge the same rent but aim to keep more profit whilst endangering their tenants’ comfort and safety have to take the risk of unhappy tenants withholding rent and needing a S8 with the inherent risk of a probably entirely justified counter-claim for repairs. Boo-hoo!