An issue which sometimes arises for Landlords letting properties on an Assured Shorthold Tenancy (AST) basis is where the tenants seemingly abandon their tenancy during the period. Landlords are often left in a difficult situation where on the one hand they do not have a tenant in occupation paying them rent, yet if they change the locks and seek an alternative tenant they can commit a civil wrong or criminal offence under the Protection From Eviction Act 1977.
Abandonment by Tenants Under Current Legislation
Landlords will be familiar with the section 8 Housing Act 1988 procedure for obtaining possession and/or unpaid rent or other breach of the AST terms. However, this can be a lengthy and arduous process with no guarantee of achieving the desired possession and removal of troublesome or non-compliant tenants. The section 21 Housing Act 1988 procedure is slightly faster for achieving possession of the property, however this can only be visited as the AST term comes to an end. As AST terms can vary up to three years in length, this can be too long to wait for a Landlord who is encountering issues with tenants early on into the tenancy or, as is discussed in this article, where tenants appear to have abandoned the property.
Currently, Landlords in the situation of abandoned premises are unable to successfully re-market or let out the property to new tenants, nor can they take measures such as changing the locks for fear of the tenant resurfacing again during the remaining term and claiming against the Landlord under the Protection From Eviction Act 1977.
Housing & Planning Act 2016 – Light at the End of the Tunnel?
The UK government has long since recognised that this is an ongoing problem facing Landlords across the UK. The Housing and Planning Act 2016 (“HAPA 2016”), which partially came into force on 12 May 2016, provides some welcome hope for Landlords who find themselves stuck with an abandoned premises and their tenants are nowhere to be seen or found. Although the sections governing the possible new procedures are yet to come into force, they do helpfully show that the UK government has recognised this problem and is moving to re-address the balance of rights between Landlords and Tenants. As a note of importance however, if the legislation comes into force as drafted, it will only affect properties in England. Whether this will be further extended to other parts of the UK by subsequent or secondary legislation remains to be seen.
Under section 57 of the HAPA 2016, the Landlord will be able to give notice bringing an AST to an end provided;
i) The AST is for a property in England.
ii) The unpaid rent condition is met (section 58 HAPA 2016).
iii) The landlord gives the warning notices (section 59 HAPA 2016).
iv) No tenant, occupier or deposit-payer responds to the notices before the dates they specify.
Section 58 sets out how a Landlord will be able to determine that rent is “unpaid” for these purposes. There is a varying scale to be implemented depending on the payment terms and when rent is due under the AST. For example, section 58 says that if rent is payable monthly then if the rent remains unpaid for at least two consecutive months, it will be deemed “unpaid”. By contrast for longer AST’s, if the rent is payable on a yearly/annual basis, section 58 will only deem rent “unpaid” if more than three months’ rent in is arrears.
Landlords and their solicitors will need to pay close attention to the detail of section 58, in order to determine that the rent due from the tenant of the purportedly abandoned premises is “unpaid”.
Section 59 sets out the procedure for a Landlord to bring an AST to an end once they can deem rent “unpaid”. Three warning notices must be issued. The first two notices must be given to the tenant, occupier or deposit payer by letter and/or email. In the case where there is a guarantor then this must also be sent to all addresses held for them too, marked for the attention of the tenant.
Each notice must state that the Landlord believes the premises is abandoned and the tenant is to respond in writing before the specified date if the premises are not abandoned. The Landlord proposes to bring the tenancy to an end if no one responds in writing before that date.
The “period” runs for 8 weeks from when the first notice is issued by the Landlord.
– The first notice can be issued before the rent is deemed “unpaid” by the Landlord under section 58.
– The second notice can be issued as soon as the Landlord can deem the rent “unpaid” and that condition is met. This must be given at least two weeks and no more than four weeks after the first warning notice. Timing of the first notice is therefore critical to ensure that by the time of the second notice, the rent is deemed “unpaid”.
– The third and final notice must be affixed to the front of the property in a prominent and readable place. This must be given within 5 days of the end of the 8 week period. This will be 8 weeks after issue of the first notice.
If no response is received at this point, the Landlord can deem the tenancy as having ended provided they followed this procedure.
Absent tenants who do resurface after this time are not entirely without recourse, since section 60 HAPA 2016 sets out they can apply to the courts for an order to “reinstate” their tenancy if there is a good reason for their failure to respond to the notices. Exactly how “good reason” will be defined remains to be seen.
Where Does That Leave Landlords Now?
This part of the HAPA 2016 is not yet in force and currently there is no indication as to when it will be. Therefore the existing procedures are the only recourse for Landlords in the situation where their tenant appears to have abandoned their property.
However, the intention is to clearly provide a more streamlined and cost effective method for Landlords who find themselves in this situation rather than having to pursue the lengthy section 8 possession procedure, which could leave a Landlord losing many months’ worth of rent for his inability to instate a new tenant. Having said that, this new abandonment procedure could be altered at the point of coming into force and although Landlords can avoid applying for a court order, the process is technical and detailed.
This new legislation is not a panacea for Landlords with “abandoned tenants” and is not intended to replace the possession procedures in the Housing Act 1988 where there are ongoing disputes with your tenant(s). However, assuming the legislation remains largely unchanged when brought into force, Landlords in England at least, can breathe a small sigh of relief that there is a new means of re-letting their property when it turns out that nobody is home.
*This article is not legal advice and is not intended to be relied on as such. If you have any queries please get in contact and a solicitor from our team will be able to assist.
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