Dealing with consent
The rules in the Act about how landlords must deal with a request for consent to do something will apply whenever the terms of a contract allow the contract holder to do something with the landlord’s consent, whether that is a term which is there because it is a fundamental term (such as the right to add a joint contract holder), a supplementary term (such as the standard contract holder’s right to have a lodger), or because of an additional term which the parties have added by agreement.
- Requests must be made in writing. Landlords will need to note the day the request is made carefully because the time to respond will start to tick. If the landlord does not respond within the correct time then they will be deemed to have given consent, whether or not there are good reasons to refuse.
- The landlord may seek additional information (if it is reasonable to do so), but must ask for it within 14 days of the day on which the request for consent is made. If it is not reasonable to ask for the additional information, the landlord is treated as not having asked.
- The deadline for dealing with the application itself is one month – that will run from the time information is provided by the contract holder if the landlord has asked for it (provided it is reasonable to ask). Otherwise it will run from the day the request is made. Even if information has been requested, it would be sensible for a landlord to ensure that a response to the request is given within a month of the request.
- The landlord cannot refuse consent unreasonably, or grant it subject to conditions which are unreasonable.
- If the landlord consents with conditions, notice of the conditions must be given (in writing) at the same time. Clearly it would be sensible to put the response in writing whatever it is.
- If the landlord refuses consent, or consents with conditions, the person who sought consent can ask for a written statement of reasons, and if the landlord fails to provide that within a month of the request, then once again the landlord is treated as having consented without conditions. Hence even having complied with the initial deadline there is another potential pitfall here.
- The contract holder can apply to the court if they consider that the landlord’s refusal of consent, or conditions on consent are unreasonable.
- Then we need to look at how the landlord approaches the question of giving consent itself. It must take into account all relevant issues, including (but not necessarily limited to) the issues which are prescribed in schedule 6 of the Act. It would be very sensible to ensure that a detailed note is made of what is taken into account and how the decision is reached so that in the event of a challenge, compliance with this requirement can be demonstrated.
- In all cases, the landlord must consider the dwelling itself and the impact the proposed action will have on it – whether that is the size, potential overcrowding, and whether if it is a dwelling which is normally allocated to a particular class of persons, whether a person who meets that criteria will be there.
- The landlord must also consider the contract holder’s circumstances – and the effect of the proposal on the contract holder and all permitted occupiers. Previous breaches will be relevant (and it is reasonable to make putting breaches right a condition of consent).
- The last set of criteria which must be taken into account for all transactions is the impact on the landlord – including its housing management function, and allocation criteria which apply to the property.
- There are then further specific issues to take into account where the application is one to add a joint contract holder (including looking at the proposed joint contract holder, the likelihood of them breaching the contract, the potential for the current contract holder to “resign” (thus turning this procedure into a “transfer” to someone who would not otherwise be entitled to the contract).
- Where the proposal is to transfer the contract to a potential successor, the landlord can look at whether that is a way of avoiding the “only 2 successions” rule and so make the length of the contract substantially longer. If the request for consent is for a transfer to another secure contract holder (i.e. the former “mutual exchange”) then the landlord can look carefully at whether the proposal is likely to effectively circumvent the usual allocations process.
- Most of all landlords will need a key date system to ensure deadlines are not missed and checklists for considering these applications.
Notices and other information and communications
Landlords are used to talking about “serving notice”, which means that particular care is taken when formal notices need to be served – whether that is to increase the rent or serve notice in connection with the end of the tenancy.
The Act provides specific ways notices may be served, and the important thing to note here is that they apply to any notice, statement or other document required or authorised to be given or made either by an occupation contract or under the Renting Homes Act.
So that means any time the Act requires the landlord to tell the tenant something, the requirements of the Act must be met. That will include, for example, where a landlord has inspected a property when the tenant has reported disrepair – the landlord must then write to the tenant to confirm what the issue is, whether it is indeed the landlord’s responsibility and if so what work is being arranged and when.
That may not be a bad thing – if landlords are able to create systems and processes to do this then certainly in the context of disrepair claims, creating a paper trail which confirms exactly how every report has been responded to will help enormously when defending a claim.
The Act talks about “giving”, not about “serving” – but they mean the same thing, and the important thing to note here is that “giving” does not mean the document needs to be physically handed to the contract holder.
The key points are:
- Where there is a prescribed form use it and do not amend it. Any alteration or amendment to the form may make it invalid. We would even advise not badging it or altering the font. We would also recommend not storing the forms on your system in case they get updated. Each time you use it, get the copy from the Welsh Government website.
- Where there is no prescribed form, by all means create your own standard documents but make sure they meet any requirements in the Act.
- They can be sent by post to the property, or delivered there. They may also be sent to another address which is either the contract holder’s last known address or an address they have told you they can be served at.
- They can be handed to the contract holder.
- If the contract holder has agreed, documents and communications can be sent by email or other electronic means, as long as if a signature is required, the document carries a certified electronic signature. The document must also be capable of being retained and stored (so serving by snapchat will not be good enough!) It would be wise to build in a means of ensuring the electronic contract addresses are kept up to date. Clearly every communication must also be recorded in the landlord’s files too.
Prohibited Conduct/Anti-social behaviour
There are two key features of the Act when it comes to Anti-social behaviour (ASB). Firstly, we now have a specific definition of what it is in the “prohibited conduct” term – see below.
Secondly, whilst many of the ASB remedies are completely unaffected (injunctions, ABCs, mediation, warning letters, CPNs, CRASBOs, Closure orders, PPNs and dispersal orders), a new process is added to the two traditional “eviction” options (possession and demotion). The landlord may now apply for one joint contract holder to be removed from the contract on the basis of their prohibited conduct.
It will be very interesting to see how that will play out. No doubt it will be a point raised in defence whenever possession is sought against joint contract holders – and it will be a device which perhaps drives a wedge between two joint contract holders. It may be more likely that they need separate representation in possession claims.
Judges will need to take into account when considering reasonableness whether a lesser remedy is available so it will come into consideration at that point even if not specifically argued.
However, there is no mechanism in the Act to actually ensure that the “excluded” contract holder leaves the property. If that is the order made, it will not be an option to instruct the bailiff to remove them as the landlord has no right to possession of the property if the contract continues for the remaining joint contract holder. The excluded party will only become a trespasser if that contract holder requires them to leave. The remaining contract holder is entitled to have “permitted occupiers” so their compliance will undoubtedly be necessary for this type of order to be appropriate.
As such, the landlord is likely to need to consider other remedies alongside an exclusion order – such as an injunction, and possibly a suspended order against the remaining contract holder to require them to undertake reasonable endeavours to remove the “excluded” contract holder.
As for the other remedies, they are largely the same but also different. “Demotions” as they were, they remain available as “orders imposing prohibited conduct standard contracts”. Possession claims are now on the basis of just two grounds – breach of contract (including breach of the prohibited conduct clause) and estate management. Reasonableness is required but now assessed by a structured discretion, the court being required to take into account particular circumstances as prescribed by the Act.
If an estate management ground is relied upon, the landlord must also procure suitable alternative accommodation, which, once again, is assessed by reference to criteria set out in the Act.
Prohibited Conduct is the term used in the Act to define anti-social and other undesirable behaviour which may make it appropriate for a landlord to seek to end a contract, or to end the rights and obligations of one joint contract holder. It is intended to cover all behaviours which might impact on other people. It is a fundamental term which cannot be modified. As such, it is not possible for a landlord to include other terms in the contract which relate to anti-social behaviour or nuisance. However, it is permissible for a landlord to provide more detailed explanation for the contract holder about what the Prohibited Conduct clause includes, provided that explanation does not try and alter the meaning of the clause.
The clause provides that the contract holder must not:
- Engage or threaten to engage in conduct which is capable of causing a nuisance or annoyance to
- a person who has a right to live in the Dwelling, or
- a person who has a right to live in other accommodation in the locality of the Dwelling
- a person engaged in lawful activity in the Dwelling or in the locality
- Engage or threaten to engage in conduct which is capable of causing a nuisance or annoyance to the landlord, or to a person (whether or not an employee) acting in connection with the exercise of the landlord’s housing management functions, and the conduct must be directly or indirectly related to or affecting the landlord’s housing management functions.
- Use or threaten to use the Dwelling or any common parts (or any part of the building which it is part of) for criminal purposes
- Allow, incite or encourage any person who is living in or visiting the Dwelling to act as mentioned in (1) or (2)
- Allow, incite or encourage any other person to act as mentioned in (3)
Whose conduct is relevant
Any behaviour of the contract holder themselves is covered so action can be taken against the contract holder for breach. If there are Joint Contract Holders, action may be taken against either or both (see below).
However, some care will need to be taken where there are concerns about the behaviour of someone who is not the contract holder, as the contract holder is only liable for their behaviour if it can be said that they “allowed, incited or encouraged” it, although the Act says that they can do that by “act or omission” which means that a failure by the contract holder to take appropriate steps to control behaviour of other may be a breach of the contract.
This will be particularly difficult where looking at claims against parents who cannot control their children and it may mean that possession is not an option in these cases.
What are the Landlord’s options?
Where the landlord is satisfied that there is behaviour falling within the Prohibited Conduct clause, the options which are created by the Renting Homes (Wales) Act 2016 are:
- Seek possession against the contract holder or holders on the basis of Breach of Contract.
- Seek a court order imposing a Standard Contract on the basis of the conduct (a Prohibited Conduct Standard Contract).
- Where the conduct is on the part of one joint contract holder only, the landlord can seek to end the contract for that one contract holder.
- Seek all of the above in the alternative – the court can make whichever order it thinks is most appropriate, which may depend on the behaviour of the contract holder after the notice/court proceedings, and what is said and done at court. It does of course mean serving a plethora of different types of notice.
- Possession claims (read more about possession claims here)
Other points to be aware of
It is a supplementary term of all Secure, Prohibited Conduct and Introductory Standard Contracts that the landlord must give the contract holder appropriate advice if the contract holder reports to the landlord conduct that is prohibited under section 55 of the Act on the part of anyone living in property belonging to the landlord (including the property occupied by the contract holder).
Again it will be interesting to see how this is dealt with in practice – and whether it is raised in defences to possession claims, particularly those claims where the contract holder is alleging ASB by others, particularly the witnesses the landlord is relying on, or where the issues are with the conduct of a permitted occupier (once again the child whose conduct is out of the control of a parent). In those cases, if a contract holder reaches out for help (or makes counter-complaints) the landlord will need to respond carefully.
Now and the future
This year’s rent increases must still be done under the existing law. So RSL landlords are likely to have to comply with s13 of the 1988 Act (unless their tenancies say otherwise). Many carry out increases on the first Monday in April so most likely increased rents on 5th April 2021, and will plan to do so again on 4 April 2022 (and in fact will be unable to do so within 52 weeks of the last increase).
Local Authority landlords will review their rents regularly in accordance with their tenancies and s24 of the Housing Act 1985 although mostly do not have the same constraint on the period which must have elapsed since the previous increase.
So how do this year and next year compare?
Under the 2016 Act, s104 (secure contracts) and s123 (standard contracts) provide that the landlord may vary the rent by giving the contract holder at least two months’ notice. It goes on to provide that the “first notice” may take effect at any time but after the first increase, a landlord may not specify a date for increase which is “less than one year after the last date on which a new rent took effect”.
The Act allows the Welsh Ministers to prescribe the form of any notice served under it, so it is very likely in March that we will find out what the notice looks like.
In other words, on the second and all subsequent occasions a rent is increased, a full 12 calendar months must have passed since the last increase.
For RSL landlords that will raise a key issue. It will no longer be possible to increase rents on (for example) the “first Monday April” as is common practice now because in most years only 52 weeks and not a full year has passed from the previous increase. Landlords will likely move to the same date for implementation of rent increases every year (eg 1st April – but do read on).
The date which is adopted next year may not be straightforward. The transitional arrangements make it clear that if a notice has been served to increase the rent before the Act came into force, then increases after the Act comes into force cannot take effect within 12 months of the date specified in that notice. In other words, where there has been an increase on 4 April 2022 landlords will not be able to increase rent again until 4 April 2023 or later. So those who may be thinking about a move to increases on 1st April every year from 2023 onwards need to bear that in mind.
At the same time RSL landlords cannot necessarily move the date forward this year to avoid that problem unless s13/their tenancy allows them to. So there may be little that landlords can do to prevent that problem arising, apart from decide to carry out no increase at all this year. At some point each landlord will need to
decide when its usual rent increase date will be (bearing in mind that if the current tenancy prescribes it, that may need to be changed too)
Landlords – including local authorities – who are able to increase on or before 1 April this year should consider doing so if they are not already.
Q We increased rent on 4th April 2022 (the first Monday in April, which has been our usual practice for years). Can we increase rent by serving notice to increase it on Monday 3rd April 2023 but not take payment of the increased amount until after 4th April 2023?
> In short, no. The earliest date which can be in the rent increase notice is 4th April 2023. A notice specifying an increase any earlier is likely to be invalid.
Landlords who have increased rent on the “first Monday” model will need to select a different increase date – most likely the same date each year. That is going to be a midweek increase most years (which is valid under the Act in a way it was not valid under the Housing Act 1988). If the landlord chooses not to ask for payment of the increased amount until the following Monday (to avoid confusion and arranging for systems to deal with “part weeks”), that is likely to be fine.
Q We saw the amendment provided by the Renting Homes (Wales) Act 2016 (Housing Association Tenancies: Fundamental provisions) Regulations 2022 – this appears to remove the problem with rent increases needing to be a full 365 days apart as Housing Associations do not need to comply with s104. Is that right?
> We are afraid not. Those regulations only disapply the rent increase provisions for “Housing Association Tenancies” – that is only tenancies which are within the Rent Act 1977 (i.e. effectively old HA secure tenancies – those which began pre-1989). For those tenancies, the rent increase provisions in the 1977 Act are preserved.
Q Written in the introductory information of the contract is the following:
‘You must not allow the dwelling to become overcrowded by permitting more people to live in it than the maximum number allowed. Part 10 of the Housing Act 1985 provides the basis for determining the maximum number of people permitted to live in the dwelling.’
What advice would you recommend if a contract-holder does allow the accommodation to become overcrowded but then claims it is unfit for human habitation?
> Part 10 is a high threshold – it provides a “room standard” and a “space standard”. Both standards are quite old and outdated. For example, when considering how many rooms there are which are “available for sleeping”, a living room or dining room can be included. Hence hopefully there will be no (or few) cases where this standard is breached. If it is breached but because a tenant has allowed people to move in, then it is likely you could defend a case for “fitness” on the basis it is the contract holder’s fault.
The fitness for human habitation guidance says that Part 10 is a minimum standard – i.e. it is possible that a property could be “overcrowded” even if the part 10 threshold is not met. However, there is no clear guidance on what point a property is overcrowded. Like the other fitness issues, it will be a subjective test.
If the contract holder has allowed more people to live at the property than it was intended for, it is easier to take action if it is clear from the contract how many people the contract holder may allow to live at the property (likely to be fewer than the Part 10 standard would allow). It will be important to know what the maximum number of permitted occupiers for each property is and we suggest you have a clause in the contract setting that out. Many tenancies already do in which case those clauses ought to carry over.
Missing joint contract holders
Q In the case where a joint contract holder passes away and the other joint contract holder does not reside at the property would you need to do a withdrawal notice (to the absent joint contract holder) to end the contract?
> In this case the contract is continuing. You could serve an RHW23 for breach of an obligation to use the property as the only or principal home but the most sensible course is probably to follow the abandonment procedure. If you know where the departed contact holder is, you could agree to end the contract with them or they could serve notice to end it.
Address for service and the obligation to serve RHW2
Q Currently we use a PO Box as our address. Given that all contract holders will need to be given notice (RHW2) of our address should this be changed to a real address that can be found by contract holders and members of the public?
Think that the general rule is that you cannot use a PO Box as a company’s registered office, not sure if that would apply to the Local Authority?
> The RHWA obligation is in s39 – it is only an obligation to give an address at which they can “send” documents, so in principle a PO Box complies with the Act. However, I can see that some people prefer to be able to deliver documents and so there is something to be said for providing a physical address too.
Deposits and secure tenancies
Q Can we take a deposit on a secure contract?
> Yes, the Act allows a deposit to be taken for any contract, and the requirements to comply with in terms of placing it with an authorised scheme apply to secure contracts as much as standard ones. Obviously if it is a social let made from your housing waiting list then you are unlikely to take a deposit but if you are using a secure contract in circumstances where you might be entitled to use a standard one (e.g. intermediate lets), there is no reason why you should not.
Mutual exchanges (or whatever they may be)
The first thing to say about mutual exchanges in a Renting Homes world is that we need to find something new to call them. That is because, under the Act there is actually no requirement for them to be mutual or any form of exchange at all.
What the Act does, at s118, is give a secure contract holder a right to transfer their tenancy to another secure contract holder of a community landlord. The right is dependent on the landlord giving consent.
So a contract holder may seek the landlord’s consent either for a transaction which is intended to be reciprocal – ie a mutual exchange (or even three or more way exchange), or they may seek consent for a single transfer of their property to a new contract holder (effectively giving up their own contract altogether).
Consent cannot be unreasonably refused. It can be given with conditions, but those conditions must be reasonable. The contract holder can apply to the court if there is an unreasonable refusal, or if conditions which are imposed are unreasonable, and the court may declare that the landlord is to be treated as having
consented (or consented without condition).
The way the landlord must approach the question of consent is set out in Schedule 6, which provides specifically that the landlord can require the incoming tenant to bring their succession status with them. It also provides that the landlord can take into account whether the transfer is intended to be part of a series (ie mutual) and if so, the consent may be conditional upon all of the transfers going ahead.
Schedule 6 also contains a number of other factors which landlords can take into account when giving consent including the size and suitability of the dwelling, whether it is adapted or provided for specific customer groups, breaches of the contract, and the impact on the landlords housing management functions.
There clearly cannot be a policy of refusing a request for consent just because there is no “exchange”, but at the same time landlords will be conscious of needing to ensure that this process does not allow someone who is in suitable accommodation elsewhere to circumvent the allocations process and in effect jump the queue. Paragraph 7 of schedule 6 enables the landlord to carefully consider the proposed transaction in light of the relevant allocations scheme or rules which will mean in effect considering other information, such as the state of the waiting lists, and whether the property is in a high demand area. Each case will depend on its own facts. As such, it would be sensible for landlords to review their allocations policies and have discussions with partner organisations including local authorities in order to ensure that everyone adopts a similar approach and that there can be an exchange of information where necessary (bearing in mind the deadlines).
Landlords will need to be aware that they only have 14 days to ask for additional information, and the request for consent must be dealt with within one month following the application (or the receipt of information, if requested). A failure to deal with it will mean that consent is deemed as given. There is no provision for these deadlines to be extended. Key date management systems may therefore be critical.
Q In relation to mutual exchanges, in a meeting with WG last August I noted down that the following was said: Mutual exchange model is simpler than the current process. Currently you can’t have an open chain but under RHA you can create a void. I’m trying to get my head around what this means for us. Are you able to explain how this could work in practice please?
> Under Renting Homes, there is no requirement of a “swap” – ie a secure contract holder (A) has the right to transfer their contract to another secure contract holder (B) if both have a community landlord, whether or not B intends to transfer their contract to A at the same time. If the landlord gives consent to this proposed transaction, then B’s property will become a void. That may be a property belonging to the same landlord or a different community landlord.
When the landlord considers giving consent, the issues it can take into account include the fact that there is no “exchange”. The landlord can also consider the impact on its ability to fulfil its housing functions (which may include taking into account the property which will become void and the demand for it), whether B would obtain a similar property if the transaction did not take place, and how the transaction fits with its allocation rules or scheme.
Q Does s72 mean that we won’t technically need to complete a ‘deed of assignment’ for a mutual exchange/assignment? We get the parties involved to complete a deed of assignment and licence to assign tenancy. Either way I think we’d just retain the same forms and tweak if needed. We need to have a record/details. Really appreciate any further advice you can offer on s72.
> At the moment, many landlords use a “deed of assignment” and a separate licence to transfer a tenancy or carry out a mutual exchange. A deed is a form of legal document which carries not only a signature but also a particular execution clause and it is witnessed. s72 provides that a transfer does not need to be by a deed. It does however still need to be in writing and signed. So landlords will need to have a form ready to use.
There will be no need for a separate licence to assign – this is the document which demonstrates that the landlord has consented to the transfer. Where a landlord consents, it must now be a party to the transfer agreement itself. So only one document is needed. It is likely that what you have will only need minor amendment.
Q What happens if the mutual exchange is between a Welsh and English landlord – is there a time allowance conflict?
> First of all, the s118 right is to transfer the contract to another secure contract holder of a community landlord. If the incoming tenant is from a property in England, then they will be a secure tenant or an assured tenant and not a contract holder. Whilst it is not specifically dealt with in the Act, we think it is likely that the court will interpret the s118 right as applying to someone who would be a secure contract holder of a community landlord if the property were in Wales.
In terms of the timescales, the 14 day/one month deadlines will apply to the application for consent for the incoming transfer to the Welsh property. That means the Welsh landlord will need to make its decision before the English one. If there is a mutual exchange planned, then the landlord is able to make the consent conditional upon the whole transaction going ahead, so if that condition were applied, and the English landlord subsequently refused then the consent would fall away and the transfer would not be permitted.
Q There’s no way a secure and standard contract holder would be able to exchange between each other?
> The s118 right does not apply in this case to either contract holder. The standard contract holder does not have the right, and the secure contract holder is only entitled to apply to transfer to someone else who holds a secure contract.
Q S72 says that the Landlord and Tenant (Covenants) Act 1995 is dis-applied to certain transfers that relate to occupation contracts. What does that mean?
> The 1995 Act provides that where a lease or tenancy is assigned, after the assignment the original tenant or lessee is no longer liable to perform the covenants. Exactly the same is now set out in section 70 of the Renting Homes (Wales) Act 2016 and so the 1995 Act is not needed.
Q If someone is a priority successor and they transfer (mutually exchange) the person taking their contract would be informed that a Priority Succession had already taken place and so there could only be reserve succession?
Would the person that succeeded to the original contract take that status with them or would it be at the discretion of the new or even the same landlord to impose that as a condition?
> A transferee coming into a property where there had already been a succession is not actually affected by that succession. The succession right is dependent on looking at the individual who died and whether they were a priority or reserve successor, it is not determined by looking at what has happened to the contract previously. If neither landlord makes it a condition of consent that the transferring tenants take their status with them, then neither will be treated as a priority or a reserve successor after the exchange has happened even if they were a successor. That means effectively that the slate is wiped clean so that when either die, succession happens anew.
So it is critical that the succession status is looked at when you look at consent for the transfer or the mutual exchange (and if it is a mutual exchange with two different landlords, both must consider it).
You can make it a condition of consent that an incoming tenant brings their succession status with them (the Act specifically provides for this).
However, that does not apply if the incoming tenant is not a successor. When you come to consider what is reasonable in terms of either refusing consent or imposing a condition schedule 6 sets out what you must take into account. There are some very general provisions about being able to consider the ability to fulfil your housing management functions.
So arguably, if you have a contract where one or two successions have already happened, the impact of allowing a transfer in from someone who is not treated as a successor could mean that the contract is going to last an awful lot longer than it normally would – possibly for another two successions. Hence that impacts on the availability of stock and arguably therefore your housing management functions.
That said the impact on housing stock overall evens out. Hence it is not clear whether you could refuse on this basis (generally, probably not) or whether you could require the incoming tenant to accept that they will be treated as either a priority successor or reserve successor. It might be possible if you had for example a particularly unique property or a high demand property.
Q If a person becomes a contract holder by means of succession or as a transferee and are therefore recorded on the system as a Priority Successors, what happens to their status as a priority successor if they are either granted a management move or are allocated another property by means of the allocation policy, or if they have been temporarily decanted and the decant is made permanent?
> If they are a secure contract holder, and the second contract starts within 6 months of the end of the first contract, then provided either the landlord is the same or the dwelling is the same they will take their succession status into the new contract (s83(8)).
Q Is Rent to Own and Shared Ownership covered?
> Rent to Own is likely to come within Renting Homes. Provided the “non social accommodation” exclusion applies (see table above), it can be a standard occupation contract but a s13 notice is required. Shared ownership is excluded. A shared ownership lease will not be an occupation contract.
Q What about the position of those housed under licences during Covid?
> This will depend on what (if any) homelessness duty was owed when they were housed, their circumstances and duty owed now (and how long ago that duty was assessed), and who the landlord or owner of the property where they have housed is. Each case should be looked at carefully before July.
Q If we have inadvertently used an assured tenancy rather than an AST in a supported housing project in the past can we correct this by serving a s13 notice when the tenancy becomes an occupation contract?
> There is strictly speaking nothing specific in the Act which says that you must allow all assured tenants to become secure contract holders. However, a contract holder has a right to challenge a decision to serve a s13 notice (under s14). We expect the court may have sympathy for someone who had
Q Can we still call a tenant a tenant?
> Yes, the Act does not invalidate the term “tenant”. It uses the phrase “contract holder” only because it is intended that the distinction between a tenancy and a licence is removed. Hence “contract holder” covers both, but a tenant will still be a tenant. There is no reason why you should stop using the terminology – I know some landlords are considering consulting with tenant bodies to see what they want to be called in future. Either way, as long as there is some clarity that the words are used interchangeably so no-one is confused that is fine. We cannot see the term “tenant” falling out of use!
Q Obligation to prepare and publish statement of arrangements for consultation
> DID YOU KNOW THAT…. Sections 234 and 235 of the Act require all Community Landlords to make and maintain arrangements for consulting with contract-holders in relation to certain proposals, and to prepare and publish a statement of those arrangements. A local authority must make a copy available at their principal office, and an RSL must send a copy of the statement to the Welsh Ministers and to the local housing authority (who must then also make that statement available at their principal office).
Before making any decision on a relevant proposal, Community Landlords must consult with their contract holders and consider comments made by contract holders in accordance with those arrangements.
The decisions which fall within that obligation include any proposal which is a “relevant proposal on a housing management matter” – that is anything which relates to a new programme of maintenance, improvement or demolition of dwellings, or any change in the practice or policy of the landlord in relation to managing, maintaining, improving or demolishing any such dwelling. The consultation obligation will arise if the proposal is likely to substantially affect all the contract holders, or a relevant group of contract holders.
Q Where we have an additional term which allows the tenant to do something provided they seek our consent, I am assuming the requirements to respond within a month etc do not apply?
> No, the requirements about consent will apply whenever there is a right in the contract for the tenant to do something with consent (whether that right arises in a fundamental term, a supplementary term or an additional term). Hence if you add an additional term which has a consent aspect, the deadlines and constraints do apply.
Q How should we deal with the right to withhold rent in our income policies?
> There is no “right to withhold rent” and there is a real danger that if it is perceived that there is such a right, this could lead tenants into debt. It will be as important as ever that tenants avoid getting into debt by deliberately withholding payments.
There is a right to “set off” where the tenant has a genuine claim against a landlord – i.e. the tenant can claim to set what the landlord owes him against the rent which he owes to the landlord. The difficulty is where there is a dispute about whether the landlord owes the tenant compensation or not.
The objective where the tenant claims to be able to set off a debt should be for the landlord to resolve whether it owes the tenant a debt or not as quickly as possible before the situation gets out of hand. Hence if it the case that compensation is payable under the Act for a failure to provide a written statement or the notice of the landlord’s address (RHW2), the landlord ought to acknowledge that and either pay or credit the amount to the account as quickly as possible.
However, if it is not payable, the landlord should explain that clearly to the tenant and tenant should be encouraged to pay.
There is a danger that the supplementary term which provides that rent is not payable for any period when a property is unfit for habitation might encourage non payment or give the impression of a right to withhold. The key point to note is that it does not follow that because a tenant considers or suggests that a property is “unfit” that it is actually unfit. In the context of disrepair claims we have seen many surveyors acting for claimant firms who are happy to pronounce that a property is “unfit” without properly assessing the question. What is clear from the guidance is that simply because a hazard exists does not necessarily mean a property as a whole is unfit.
Ultimately, whether a property is “fit” or not would be a question for a court to determine if the landlord and tenant cannot agree. If the tenant has not paid rent in the meantime and they turn out to be wrong, they could be seriously in debt. Where the fitness of the property is in question, landlords should assess it for themselves and respond/carry out works as promptly as possible. They should also encourage the tenant to carry on paying whilst the issue is resolved with the reassurance that if the landlord is found to have allowed the property to be unfit, compensation will be paid.
If it turns out that there was a period when the property was not fit, then it would seem compensation is calculable at 100% of the rent just for that period.
Of course, the other option for landlords is to consider whether to amend or remove the supplementary term – that will be a question of policy for each landlord to consider.
Lastly the rules of set-off apply both ways – in other words if the tenant is in arrears but the landlord accepts that an amount of compensation is due, the landlord may deduct the arrears from the compensation before paying it.
Q Do we need to include a Data Protection clause to the contract?
> There is no need to do so from a pure Renting Homes perspective; however, clearly you do need to make sure that GDPR is complied with and so data is processed as it should be and with specific consent where necessary. We are finding that people are tending to move away from having a data clause in the contract (not least because if you do need specific consent to process data in a certain way that needs its own signature – it cannot just be added as a clause in a tenancy). If you need advice on your data protection obligations that should be looked at separately.
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