Section 81 of the Coronavirus Act 2020 – Residential Tenancies
As mentioned in our previous article the Government passed a special legislation, namely the Coronavirus Act 2020, in light of the Coronavirus outbreak. In this article we will talk about what measures have been introduced to help protect residential tenants in this difficult and uncertain time.
Section 81 of the Coronavirus Act 2020 has put in place special measures for residential tenants who find themselves unable to comply with the obligations imposed on them by their tenancy agreement.
Restrictions on the Termination of Tenancies
The Coronavirus Act 2020 stipulates that from the 26 March 2020 until 30 September 2020, Landlords must give all tenants three months’ notice if they intend to serve any notice seeking possession or notice to quit.
The temporary measures apply to the possession of tenancies governed by the Rent Act 1977, the Housing At 1985 and the Housing Act 1988. If Court proceedings are necessary, Landlords will be able to apply to the Court after the three months’ notice.
Please note the Secretary of State now has the power to extend this period by up to a further three months should it wishes to do so.
Landlords wishing to serve notice on tenants ought to be aware that the change in the legislation is also reflected in the prescribed forms of Notice. Form 3 and Form 6A, also known as Section 8 and Section 21 Notice’s respectively, have been changed.
Landlords must use the current forms (accessible via the Government’s website: www.gov.uk/guidance/assured-tenancy-forms) until 30 September 2020.
It should be noted that the special measures do not alter a tenant’s obligation to pay rent, but rather delay enforcement of the obligation through the threat of Court proceedings.
This means a tenant is still liable to pay their rent, however the Courts and the Government are urging cooperation from Landlords to accept late payment of rent from their tenants, over a period of time (i.e. over instalments), during these uncertain times.
If a Landlord relies on the rent to pay their Buy to Let mortgage, the Government has provided Landlords with some additional help in that they are protected by a 3 month mortgage payment holiday. As with rent the obligation is not written off, but merely suspended and interest will continue to accrue.
Suspension of Possession Proceedings
From 27 March 2020, the Courts have suspended all ongoing housing possession cases. This means that neither cases currently in or about to go into the system can be progressed.
The suspension of housing possession actions will initially last for 90 days and applies to all possession actions brought under CPR Part 55.
This means, all hearings which were listed to be heard until the end of June will be vacated. County Court bailiffs have also ceased enforcement of possession orders which are already in force for the time being.
Please note the Coronavirus Act does not apply to all tenancies, for example, it may not apply to some student lettings, holiday lets or tenancies at low rent. It is worth noting that this Act is not retrospective, and therefore it does not apply to any notices which were validly served before its commencement. They will remain valid for the purpose of issuing future court proceedings. However, If Court proceedings are necessary, Landlords will not be able to issue proceedings until after the suspension is lifted.
The Coronavirus Act does not prevent Landlords from serving notice on tenants. However, Landlords must give at least three months’ notice under the Act. If the tenant has not vacated the property within the three months’ notice period, Landlords cannot commence Court proceedings until after the suspension has been lifted.