Covid-19 and possession claims
James Harrison, Partner and Head of the Housing Team at Edwards Duthie Shamash, explores the impact of the Coronavirus Act on residential possession proceedings.
On 18 March 2020 the Government announced “a radical package of measures to protect renters and landlords affected by coronavirus” with the objective of ensuring that “no renter in either social or private accommodation will be forced out of their home during this difficult time”. So how has the Government achieved this?
The Coronavirus Act 2020 extends the time period for various notices, including those served under sections 8 and 21 Housing Act 1988.
Section 21 is a “no fault” ground for possession which, subject to various technical requirements, allows a landlord to obtain a possession order regardless of whether the tenant has complied with the conditions of tenancy or has breached them. The Coronavirus Act extends the notice period under s21 from 2 months to 3 months. It should though be noted that section 21 is a mandatory ground for possession. If the Court is satisfied that the notice is valid and that the various technical requirements have been met (i.e. protection of the tenancy deposit, service of the Prescribed Information and selective/HMO licensing) it must make a Possession Order. Moreover, the date for possession (i.e. the date when the Possession Order takes effect) cannot be extended beyond 42 days, and only then if the Court is satisfied that exceptional hardship would be caused by an earlier date.
The notice period for a section 8 notice is extended from 14 days to 3 months. When bringing a claim for possession based on a section 8 notice the landlord can rely on various statutory grounds for possession, including a breach of the terms of the tenancy, and perhaps most commonly arrears of rent. There are 3 statutory grounds for possession, known as grounds 8,10 and 11, which are set out in schedule 2 of the Housing Act 1988. Ground 8 is a mandatory ground for possession which means that the Court must make a Possession Order if it is satisfied that the rent was two months or more in arrears both when the notice was served and at the time of the possession hearing. Grounds 10 and 11 are discretionary grounds for possession which means that in addition to considering whether the ground is made out, the Court must also consider whether it is reasonable to make an order for possession.
Perhaps surprisingly the Act does not remove the power of the Court to dispense with the requirement for a section 8 notice where it is “just and equitable” to do so and where the claim is brought on discretionary grounds. That said, if the arrears of rent have accrued in whole or in part as a consequence of financial difficulty caused by the pandemic it is likely to be much more difficult than usual to persuade the Court to exercise its discretion.
The extension of the notice period from 14 days to 3 months serves to delay the point at which the landlord can bring possession proceedings. However once the proceedings have commenced – and subject to the point below regarding the stay on proceedings – the Court’s powers are the same as usual. That means that the Court will have to make an order for possession if the landlord relies on Ground 8 and the Court is satisfied that the ground is made out. Additionally, just as with section 21 cases, the Court will not be able to postpone the date for possession in a ground 8 case beyond a maximum period of 42 days.
It should be noted that the Coronavirus Act also extends to three months the notice period in relation to Local Authority secure tenancies and introductory tenancies. However, the Act does not extend the notice period for contractual tenancies and licences. That includes homeless applicants and their families living in temporary accommodation under non-secure tenancies or other contractual licences/tenancies.
It is also worth noting the Guidance from the Lord Chief Justice of 19 March in which it is said “Judges dealing with any possession claim during the crisis must have in mind the public health guidance and should not make an order that risks impacting on public health”. Plainly this does not give the Court any powers to suspend or postpone possession orders where the law does not provide for discretion, such as ground 8 cases. However, the Guidance confirms that public health arguments, including the need to maintain social distancing, would be a relevant matter when considering the exercise of discretion.
In addition to these limited changes in the law, the Courts have also made changes to practice rules in response to the pandemic. On 27 March 2020 an amendment was made to the Civil Procedure rules. The amendment, by means of Practice Direction 51Z, stays for a period of 90 days from 27 March 2020 “all proceedings for housing possession brought under CPR Part 55 and all proceedings seeking to enforce an order for possession by a warrant or writ of possession”.
This puts a hold on current proceedings in which a possession order is sought. It also puts a hold on any proceedings to enforce a possession order i.e. evictions.
As a consequence of this amendment most possession hearings that had been listed in April, May and June 2020 have been, or will be, cancelled. Those cases will have to be re-listed for hearings sometime after 27 June, or later if the 90 day stay is extended. Indeed I have seen Orders which stay claims cases until 30 October 2020 and then require an application after 30 October for the case to be re-listed.
It should be noted that the Practice Direction does not prevent new claims being issued. An amendment to PD51Z issued on 18 April expressly confirms that. However, once issued the claim would then be immediately stayed until at least the end of June.
It is reasonable to expect there to be very significant delays as a consequence of these measures. That is because there will be a significant backlog caused by the need to re-list the cases that had been listed for hearings between April and June. Additionally if the current social distancing measures continue beyond July it will be difficult for Courts to “block-list” possession cases whereby 30 to 40 possession hearings are listed for one day. That will reduce the capacity of the courts to hear possession cases and thereby is likely to cause further delay.
The Practice Direction does not apply to trespasser cases, claims for interim possession orders (in squatter cases) or claims for injunctions.
In its announcement of 18 March the Government indicated that it would amend the pre-action protocol for rent and mortgage arrears. No such amendment has yet been announced. However the Government’s intention to do so is confirmed in the Covid-19 non-statutory guidance for landlords and tenants in the private and social rented sectors issued on 28 March. It states:
“The government is working with the Master of the Rolls to widen the existing ‘pre-action protocol’ on possession proceedings for Social Landlords, to include private renters and to strengthen its remit.
This will ensure that private sector landlords reach out to tenants to understand the financial position they are in before taking possession action through the courts once the 3-month delay on issuing eviction proceedings has ended.
It will encourage landlords and tenants to work together to agree an affordable rent repayment plan if their tenants fall into rent arrears”.
The Guidance further states:
We are asking landlords not to issue new notices seeking possession, and the suspension of housing possession claims from 27 March 2020 means that existing notices seeking possession cannot progress……
A tenant issued with a three-month notice immediately after the Coronavirus Act 2020 comes into force would see that notice expire in three months. At the expiry of the notice, a landlord who wanted to take the next steps in progressing the possession claim would have to apply to the courts for a possession hearing, a process that ordinarily takes 6-8 weeks, and may take much longer under the current circumstances.
This is consistent with the view expressed above regarding the delays that are likely to occur at the end of the 90 day stay imposed by Practice Direction 51Z.