This document provides information on section 21 notices in the UK, which allow landlords to regain possession of a rental property from assured shorthold tenants without having to establish fault. It discusses the history and legal framework of assured shorthold tenancies, the accelerated possession procedure for section 21 notices, potential defenses tenants can raise, and alternatives to using a section 21 notice.

1. H ENRIQUES G RI ff ITHS www.henriquesgriffiths.com SOLICITORS Section 21 How and Why? Disclaimer. This presentation is a generalised guide to the law and is not intended as a substitute for detailed legal advice and accordingly Henriques Griffiths accept no liability for any act or omission unless detailed advice is subsequently given. Background In the 1980s the Conservative Government had a economic agenda of a property owning democracy. That would take property out of the rental market so they decided to open up the rental market to encourage owners to rent out. Up to that point owners were worried by the great protection given to tenants in the 1977 Rent Act. Assured Shorthold Tenancies (AST) were first created in the 1988 Housing Act. Nicholas Ridley the then Housing Minister stated such tenancies were to top up the rental market not replace the existing types of tenancies (assured). In order to get the benefit of the AST when the time came to repossess, the Landlord had to have kept the paper work to include a notice given when the tenancy was created stating that possession might be sought, as well as a proper written tenancy agreement.

2. H ENRIQUES G RI ff ITHS www.henriquesgriffiths.com SOLICITORS Section 21 How and Why? 1996 Housing Act One of the last things the Conservative Government did was accept that ASTs were not a top up for existing tenancies and had become the norm. Landlords had found it difficult to get possession orders when they had not kept the paperwork or it was not in proper form. For tenancies agreed after February 1997, it is presumed to be an AST unless the contrary is agreed and the need for the initial notices and in theory written tenancies ended. In practice a written tenancy is required to use the Courts accelerated possession procedure for ASTs. If the there is a written tenancy agreement then this procedure can be used provided a proper section 21 notice has been issued

3. H ENRIQUES G RI ff ITHS www.henriquesgriffiths.com SOLICITORS Section 21 How and Why? Accelerated Possession procedure Only available for ASTs. Prescribed form (N5B) must be filed at the right Court with copy tenancy agreement and Section 21 notice and evidence of service and the Court fee (£150 payable to HMCS). Possession online facility will not cover this. Check the nearest Court deals with the address the property is located and issue there. Other County Courts do not have jurisdiction. Some Courts will list postcodes for their jurisdiction on their entry on the Court Service website. www.hmcourts-service.gov.uk (Once in click on “Court Information and addresses”) The Judge will look at the papers and if all is in order will make a possession order without a hearing though the tenant can apply to set it aside and file a defence (rare).

4. H ENRIQUES G RI ff ITHS www.henriquesgriffiths.com SOLICITORS Section 21 How and Why? Why bother with a Possession Order? If the tenant has not vacated voluntarily, getting possession without a possession order is usually a criminal offence and the dispossessed tenant can claim damages from the Landlord for the difference in value of the property with the tenancy in place and without. In practice, if the tenancy is an AST damages are usually under £10,000 and can be under £1,000. The expiry of fixed term or the section 21 notice does not suffice – you need a Court order. The reason is that the section 21 notice ends the contractual tenancy but the law imposes a statutory tenancy starting immediately after the contractual one ends on much the same terms save the statutory tenancy can only end on the expiry of a possession order. The tenant is still a tenant with full rights until the time set out in a possession order expires.

7. H ENRIQUES G RI ff ITHS www.henriquesgriffiths.com SOLICITORS Section 21 How and Why? Defences Problems: Service by post without a clause allowing it in the written tenancy agreement. This is often overlooked by the Judge dealing with the case and for that matter most non specialist solicitors advising any tenant who often believe it does suffice. It will only suffice if the tenants admits having it but not otherwise. Service by recorded delivery when delivery fails and you are not told ( check the Royal Mail website) or someone other than the tenants signs. In this case service by both recorded and ordinary first class post is often regarded as best practice but is still a risk. It is a calculated risk because in the relatively unlikely situation where it comes about the costs of the claim are lost and possession is delayed by 3-4 months whilst you start again. The alternative is personal service.

8. H ENRIQUES G RI ff ITHS www.henriquesgriffiths.com SOLICITORS Section 21 How and Why? Moral is get a written tenancy agreement in the first place and put in a clause allowing service of the section 21 notice by ordinary first class post and specify that such service is deemed service. There is a law (Section 196 ( 4-6) Law of Property Act 1925) that allows this but there is a risk that the letter is returned by the Royal mail in the dead letter service which negates the exercise. Even greater protection is to put in the tenancy agreement that service of the notice by registered post will suffice as the 1964 Recorded Delivery Act will be used to say that even if it fails, it is deemed served. You can not use this presumption if there is no provision in the tenancy agreement. The downside is that Landlords and their agents often forget that this is in the agreement and simply post it.

9. H ENRIQUES G RI ff ITHS www.henriquesgriffiths.com SOLICITORS Section 21 How and Why? Defences The notice sets out the wrong date. There are two common situations here. Firstly the term is fixed and the fixed term has not expired and you specify a period which expires before the fixed term expires. No AST can be for a fixed term of less than 6 months. This is another reason why the agreement should be in writing. If the tenants alleges a 12 or 24 or even 36 month fixed term was agreed, the Landlord faces difficulty proving otherwise if there is no written tenancy agreement. More common is the periodic tenancy which follows the expiry of the fixed term. A different section 21 notice is required and as with fixed term notices at least two months expiring on the last day of a period of the tenancy is required.

10. H ENRIQUES G RI ff ITHS www.henriquesgriffiths.com SOLICITORS Section 21 How and Why? Defences The notice sets out the wrong date. McDonald v Fernandes Monthly tenancy started on the 4 th of the month. Section 21 notice was served before the 4 th November expressed to expire of the 4 th January. Wrong. The 4 th January is the first day of the rental period not the last day of the previous one. The correct date is the 3 rd January as long as the notice is served before 3 rd November

11. H ENRIQUES G RI ff ITHS www.henriquesgriffiths.com SOLICITORS Section 21 How and Why? Defences It does not have the prescribed information. This is the easiest problem to avoid. Use the right prescribed form. Taking a version off the internet is risky as it may be out of date. Law stationers will supply forms and some packs available on the High Street can be used but there are two versions – one for the end of the fixed term and the other for the periodic tenancies which follow the end of the fixed term. Specialist solicitors should have them on their computers and should be able to get the date and method of service right. If the tenancy agreement is written and clear, it should be easy to get the date right. Leaving out the start date, fixed term or rental period is fertile ground for the tenant to raise an argument when the possession claim is issued.

12. H ENRIQUES G RI ff ITHS www.henriquesgriffiths.com SOLICITORS Section 21 How and Why? Alternative to Section 21 If the tenant has breached the tenancy agreement you can issue a notice under Section 8 Housing Act 1988 and after that has expired issue a claim based on that. Online facilities are available and the fee is reduced by a third but if the breach is rental, you must prove at least 2 months arrears both at the time the section 8 notice is served and the time of the hearing to be sure of a possession order. Common tactics by the tenant is to pay all but 2 months rent at the time of the hearing and promise to pay the rest by instalments. Judges have a discretion to agree and will usually do so. Alternatively, tenants will argue that they have a claim for disrepair and the compensation for that will offset the arrears. That will delay the case enormously and cost a great deal which Landlords rarely get back either due to legal aid or because the tenants do not leave a forwarding address or they are simply not worth suing.

13. H ENRIQUES G RI ff ITHS www.henriquesgriffiths.com SOLICITORS Section 21 How and Why? You should not use the accelerated possession procedure if you want a money Judgment ( rent arrears for instance) or if you have failed to comply with the deposit rules (it may be quicker to remedy the error and then issue the accelerated possession claim). If you do not use the accelerated possession claim the forms are N5 and N119. The fee is still £150 unless you issue online but there will be a hearing that you need to arrange attendance at. If you lose the possession claim you normally have to pay the tenants solicitors costs at the commercial rate. It is usually cheaper to get it right in the first place. The last thing solicitors want to say is the argument for a cheap, quick and easy possession order is undermined by the state of the paperwork.