Assured Shorthold Tenancies and the Deregulation Act 2015 – The new rules

We recently hosted a very successful webinar for residential landlords in partnership with Tim Briggs, solicitor and founder of LegalMentor, a tenant eviction company with an impressive near 100% record in getting possession for landlords at the first hearing.

Tim was able to provide an understanding of Assured Shorthold Tenancies and the Deregulation Act 2015 and the changes that came into effect on 1st October 2015 and has kindly written an article on this, which I thought would be useful to share:

At LegalMentor we have been keeping a close eye on the changes in the law and how this will affect landlords and tenants, for notices, deposits and for good practice in general.

The information available can be confusing, so we have tried to put together as concise a summary as possible.

With the new Deregulation Act 2015 some important changes are coming into force on 1st October 2015 regarding section 21 notices, and landlords’ further responsibility to tenants. The rules really affect ASTs (‘assured shorthold tenancies’) that begin on or after 1st October 2015.

For ASTs starting before 1st October 2015

In relation to serving Section 21 Notices:
• Landlords can still serve a section 21 notice at any time during the tenancy
• There is no change to the form of the section 21 notices you use
• There is no time-limit after which a section 21 notice expires – unless you give your tenants a new fixed term tenancy, or arguably if you change the terms and conditions of the tenancy, for example by increasing the rent

The above rules for older tenancies will change in October 2018 to the rules set out below.

For ASTs starting on or after 1st October 2015

Importantly, remember that for ASTs that begin on or after this date, you now need to provide the following documents to tenants at the start of each fixed term tenancy:
• Gas appliance safety certificate
• An energy performance certificate (EPC)
• The government’s document called ‘How to rent: The checklist for renting in England’ – you can download a copy from the website – https://www.gov.uk/government/publications/how-to-rent

In relation to serving section 21 notices:
• Landlords can only serve a section 21 notice after 4 months of the first tenancy
• The form of the section 21 notice has to be in the new ‘prescribed form’ (available online before 1st October 2015)
• 6 month limit after which a section 21 notice expires, at the present time running from the date of service
• Any health and safety improvement notice served by the local authority means no section 21 notice can be served for 6 months

Complaints about the property

Any complaint in writing from the tenant about the condition of a property has to be responded to within 14 days. The landlord has to set out in his reply:
• What he intends to do
• The timeline for doing the repair work

If the landlord then either:
• Fails to reply to the written complaint,
• Gives an inadequate reply, or
• Serves a section 21 notice

The tenant can complain to the local authority who must inspect the property. If the local authority inspects the property it can:
• Serve a remedial notice
• Carry out emergency remedial action

At this point the landlord’s rights to evict under section 21 will be held in limbo, since:
• No section 21 notice previously served will be valid
• No further notice may be served for 6 months

However, the landlord can still serve a section 8 notice, but given the repair issues, the tenant may take the opportunity to try and counterclaim to prevent possession and claim damages.

Smoke alarms

Each floor of each property requires a functioning smoke alarm from 1st October under The Smoke and Carbon Monoxide Alarm (England) Regulations 2015.

Deposits

If a landlord took a deposit after 6th April 2007 but missed the deadline to get it registered by 23rdJuly 2015, then this is how the law stands.

If the landlord has not registered a deposit in a government-backed deposit scheme within 30 days of receiving the money, the landlord has to return the deposit money to the tenant immediately, as until the landlord does so they cannot serve a Section 21 Notice.

If the prescribed information relating to the deposit has not been given to the tenants and any other relevant persons within 30 days of the deposit being received, then the landlord cannot serve a section 21 notice. (‘relevant person’ presumably means guarantors, or anyone who helped pay for the deposit).

However, so long as the deposit money has been put into a scheme within 30 days, the ‘prescribed information’ relating to the deposit can be served at a later date, which then allows the landlord to serve a section 21 notice.

Do not expect the deposit scheme to provide the ‘prescribed information’ to the tenants, whatever the scheme suggests it might do. It is the landlord’s explicit responsibility to make sure all relevant persons receive the prescribed information. If in any doubt whatsoever, serve the documents yourself, keeping good evidence of having done so.

Also check with the scheme what documents constitute the prescribed information. The website of one deposit scheme is far from clear what documents to use. If you are not clear, ring the scheme.

Notwithstanding these difficulties over section 21 notices, any deadlines for compliance with the rules that are missed mean that the landlord will be liable to the tenant for between one and three times the amount of the deposit, should the tenant bring a claim, or a counterclaim.

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