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Abandonment

Abandonment and the Provisions of the Housing and Planning Act, 2016 (Part 3, Ch 57-63)

 

Abandonment of a residential tenancy has long been a difficult problem for Landlords to deal with – because there is no law that puts provision in place to deal with the situation. Until the H&P Act, more of that later.
 
Research by The National Landlords Association in 2016 found that between 31% and 58 % of landlords had had a property abandoned at some point.
 
Let’s look at what legal terms that do exist, see where the gaps are and the consequences of getting it ‘wrong’.
 
The starting point is that a Landlord does not have the legal right to enter a property let on a tenancy without the tenant’s consent, except in an Emergency (i.e. Water flooding out of the property or a report of the property being insecure, etc.)
 
Landlords will have heard of the requirement to give a tenant 24 hours notice in writing before a property visit / inspection, but after this period, the tenants permission is Still required (a lot of landlords don’t know this!)
 

Implied Surrender – is where the actions of a tenant are inconsistent with sustaining the tenancy. For example, ceasing paying the rent, removing all possessions from the property. The problem here is that the surrender is ‘Implied’ and not a certainty such as obtaining something in a recordable form from the tenant, confirming the tenancy has ended. Such confirmation is a Deed or Notice of Surrender.
 
In cases of Abandonment, a landlord typically finds that after a period of rent becoming overdue (often a significant period after rent first became overdue), a visit is made to the property and the landlord has one or more of a number of reasons to believe the tenant has left property. These may include, looking through the windows to see absence of furniture. Comments from neighbours of possessions being removed. Obviously attempts to contact the tenant via all available means (including next of kin, family details addresses, emails – which should ideally be obtained prior to the tenancy).
 

At some point with sufficient grounds that a landlord can show, they may well enter the property with a witness and camera and photograph the empty or partially empty property. There now exists ‘partial evidence of an implied surrender’ (for what its worth).
 
If the tenant has left and they believe have ended their tenancy, they have not given up vacant possession of the property and consequently still owe rent. If a tenant or their guarantor can be contacted, this may well prove a pivotal point in persuading  confirmation of their end of tenancy.
 
If no confirmation of surrender / end of tenancy, landlords have placed notices on the property suggesting that anyone requiring access can contact the landlord (placing such Notices can attract undesirable attention from squatters or criminals).  It is certainly not safe to remove any remaining tenants possessions, nor change the locks unless the property is insecure, let alone re-let the property.
 
There have been many cases where landlords  have ‘taken back possession’ of a seemingly empty and believed abandoned property, mainly where they have been unable to show reasonable steps to contact the tenant, and have been found guilty in a criminal court of Illegal eviction, Contrary to the Protection from Eviction Act, 1977. Landlords have been fined, sentenced to 150 – 200 hours community service and even imprisoned for this offence. Whilst these sanctions have been in the main for the deliberate eviction of tenants, it is a defence if the landlord has a reasonable excuse.
 
Its relying on a partial implied surrender, the need to show that a landlord has taken reasonable steps, that makes dealing with abandonment so precarious for landlords. Indeed, most legal advice and that of Landlord associations is to seek legal possession through the courts.  This is not as problematic as it may seem, given that rent is usually payable in advance and that by the time many landlords get round to visiting the property, at least one full months rent is overdue (often approaching two months)
 

Upon two months worth of rent being overdue, a landlord is able to serve a Section 8 (ground 8) Notice, giving 14 days before an application for Possession is made to the court. If this application (correctly submitted) is made and no objection received from the tenant, an online Possession claim can award Possession in about 28 days from application.
 

The Housing and Planning Act, sections 57-63 sought to remedy the legal lacuna and address the difficult position, allegedly.   Initially it was proposed that two notices would be required to be served before Abandonment could be confirmed and Possession taken by a landlord without a court order.  Before the legislation was finalised, a third notice was added to the requirements.
 

See link to Parliamentary debate on the Abandonment process, 26th November 2015 and summary below.
 


 

We’ll now look at the steps required for Abandonment to be fulfilled according to that legislation

 

For best effect, the Landlord would need to respond as soon as possible after rent became in arrears.

 

Sec 57 – There must be ‘unpaid rent’, of two full consecutive months where a Landlord can issue a third Notice to bring an AST to an end (see Sec 59 for Notices). If all conditions are met AND no written response received.

For the 1st Notice to be served stating property appears Abandoned and Landlord proposes to bring tenancy to an end on a stated date (at least 8 weeks after the 1st Notice).

Served on the Tenant, any named occupiers and any deposit payers, by handing it personally, if not all the following:
 
Leaving it (witnessed) at the tenanted address, sending [ by first class post with certificate of posting ], to every postal address for every Tenant, named occupant, deposit payer and Guarantor, marked for attention of the Tenant. Also sending the Notice by email to every email address for all above persons).
 
Legislation states ‘No rent has to be outstanding to serve the 1st Notice [ Sec 59{6} ].
However due to the 2nd Notice requiring unpaid rent – at least two (consecutive) months rent to be outstanding [ Sec 59{7} ] AND that the date the 2nd Notice claims property is Abandoned, must be at least 8 weeks after the 1st Notice was served but the 2nd Notice must be given at least 2, but not more that 4 weeks after the 1st Notice [ Sec 59{8} ].

Then it follows that there MUST have to be a months rent outstanding to serve the 1st Notice …duhh! (so the earliest that the 2nd Notice can be given is a month after the 1st Notice!).

The 2nd Notice is to be in the same form as the 1st Notice, and specify a date, complying with the Notice periods, that the tenancy will be deemed to have ended by Abandonment. This date must be 8 weeks after the 1st Notice, so therefore, 4 weeks after serving the 2nd Notice
 
If there has been no written response from any of the persons named above as having been sent Notices [ Sec 57{d} ], the 2nd Notice cannot be served until ‘unpaid rent’ (2 months) has been met [Sec 59 {7}]. Therefore, the deemed Abandonment date is 8 weeks after the 1st Notice.

The 3rd Notice is to be served before the period of 5 days before the Abandonment deemed date of the 2nd Notice and ‘served’ by fixing it to a conspicuous part of the property.       

If there is ANY rent paid during any period after the 2nd Notice is served and before the ‘Abandonment deemed date’ expires, the ‘unpaid rent’ condition is still deemed not met [ Sec 58 {2} ].  
 

The Housing & Planning Abandonment process, Sec 57-63 was due to come into effect on 6th April, 2018 – yet to be enacted.

 
We are going to assume circumstances meet the fastest possible scenario to allow a Landlord to reclaim the property as Abandoned, thereby changing the locks and re-letting.

Let’s picture these dates on a calendar

 

Assuming the Tenancy is a [typical] monthly rent, payable in advance due on the 5th of each month.

Rent last fully paid on 5/3/18.
   
For various reasons, Landlord has been trying to contact Tenant, visiting around the beginning of April and from what can be seen through ground floor windows, appears a lot of the (Tenants) furniture is missing / removed. Neighbours say saw Tenant removing lots of possessions, etc.
 
On 6/4/18 – First day of rent arrears, however the 1st Notice cannot be served, as the 2nd Notice requires there to be the ‘unpaid rent’ criteria – 2 consecutive months of rent arrears and that the 1st Notice be served between 2 and no more than 4 weeks before the 2nd Notice

In other words, there has to be 4 weeks and a few days of rent outstanding before the 1st Notice can be served.  

The 1st Notice and 2nd Notice are a warning Notice under the provisions of Sec 59 of the Housing & Planning Act 2018, requiring the Tenant to contact the Landlord to dispute the property is abandoned. If so, the Landlord should discuss – confirm occupation or surrender of the tenancy.

2nd Notice served – must be 2 months rent outstanding – and be served no more than 4 weeks after the 1st Notice

Therefore, 2 months outstanding on 6/5/18 – so the 1st Notice can’t be served before more than 4 weeks prior: 10/4/18 (a month and 4 days of outstanding rent).

Date specified in 2nd Notice as to when property will be recovered as Abandoned ( without any written response or rental payment of any amount)  Must be 8 weeks after the 1st Notice (10/4/18): 5/6/18

The 3rd Notice must be served prior to 1/6/18 – (i.e. 30 May or before).
 

A Housing specialist Barrister describes the Notices and process as
“Incredibly stringent”

 

The conditions of time and method of service are compounded by the ability of the tenant to apply to the County court for re-instatement of the tenancy, if they can show good reason for failing to respond to the Notices (e.g. being in Prison?) and then having to deal with any of the Tenant’s possessions, i.e. allowing reasonable time for them to be collected as they can’t be asked to remove / collect until the end of the tenancy (see Abandoned Goods)

Weaknesses with the legislation include the ‘written response’ not being defined, so a short note from the Tenant questioning the Landlord’s parentage, halts the process, as does ‘if a new payment of rent is received prior to Abandonment date, the unpaid rent criteria ceases to be met’ [ Sec 58{2} ] – a penny is a payment of rent.
 

The ‘wing and a prayer’ processes discussed before the implementation of the Housing & Planning Abandonment clause (entering with witness, taking photographs and posting a contrived and legally unspecified notice), will surely be consigned further towards the actions of Harassment / Illegal Eviction given there are now legislated process for dealing with the problem.
 

Comparing the Abandonment process with Section 8 [ Ground 8 ], 2 months rent outstanding… 

6/4/18 – 1 months rent outstanding

6/5/18 – 2 months rent outstanding – Section 8 [G8] Notice served by hand with witness, giving 14 CLEAR days, requiring possession or rent arrears given up by 21/5/18

22/5/18 – Possession Claim OnLine (PCOL) submitted. Within a few days to a week, the County Court will send letter to Defendant [Tenant] giving them 14 days to state if they wish to defend the claim.

If the property has been Abandoned, the Defendant / Tenant won’t be there to receive court correspondence, nor therefore reply within the timescale to object.

Normally, Landlords are getting Notifications from County court following PCOL, without objections – defence, that a Possession order has been made around 28 days after submission.

22/5/18 + 28 days = 19/6/18. The Possession order usually gives a date of around 14 days after its made for the Possession to be effective – 19/6/18 + 14 days = 31/7/18
 

We can see that the Sec 8 [G8] route is some 7 weeks longer, and could then still require a Bailiffs warrant to effect Physical possession [ 6-7 weeks on average, although at slightly greater cost can be expedited by High Court Enforcement Officers ] but…
 
1. Only requires 2 months worth of outstanding rent (not consecutive months)

2. Does not require the strict compliance with the Notices (Housing & Planning Sec 59) together with the potential for challenge on any one of the numerous constraints associated with each of the 3 Notices

3. Cannot be subsequently challenged, as in the Housing & Planning reinstatement (Sec 60)

4. Awards rent arrears and costs (especially bear in mind the significant Debt Pre-Action Protocol requirements for Money claims since October 2017).
 
Section 8 proceedings would certainly be preferable if there was 2 months or more rent outstanding by the time the Landlord suspected Abandonment. The moral of the story is be proactive in managing outstanding rental payments.

 
Landlords – choose your method carefully. Thoroughly understand the complex provisions of the Housing & Planning Act Sec 57-63, which I’ve tried to assist you with here.

As further assistance, please see – First, Second and Third Notices on PossessionFriend.uk. They are copyrighted but for your use providing they are not changed or the PossessionFriend.uk copyright logo altered or removed. As for how this legislation evolved, see the summary of the Parliamentary debate, below.
 

The Public Bill committee comprised a selection of Labour and Conservative MPs.
 
Shelter and Crisis both submitted responses requesting the whole Abandonment section of the H&P Act be removed. They provided some statistics from research they had carried out, albeit questionable. Crisis had approached Landlord Associations and asked what percentage of their members called regarding Abandonment. The answer was apparently 1%. An extrapolation of Landlord Association members (being in total circa 2% of all PRS landlords) somehow produced a figure of those 1%, representing 1.4 million (of 4.5 million) landlords which equated to 1750 cases of Abandonment reported to Landlord Associations / year?!
 

Contrast these figures with the % of National Landlord Association members who have experienced Abandonment 31-58% and its clear that the statistical evidence base is at great variance. Of the two MPs most prominent, were Mr Kevin Hollinrake (Conservative, for Thirsk and Malton) speaking in defence / support of the Bill and declaring his interests as a landlord. Speaking vehemently against, were a number of Labour MPs, notably Teresa Pearce for Erith and Thamesmead.
 

Interestingly, there was woeful ignorance of the timescales for a landlord to obtain Possession, following Section 21, with a Labour MP quoting 3 months, and a Conservative – 4 months! (MOJ figures are 42 weeks or 10 months).
 
The initial proposal was for 2 Notices but Labour pushed and got the 3rd agreed, even then protesting that a tenant could be declared homeless after ‘3 letters’ – which take 3 months.
 
Another request by Labour, was for the Local Authority to have a veto – be required to independently confirm that the property appeared abandoned. This vote was lost.
 

Teresa Pearce who, after acknowledging that the majority of landlords were good and proper citizens, claimed the Housing Ministers estimation of 10,500 rogue landlords was an under estimation, as they were just the ones we knew about. She was quite scathing against Landlords in her constituency, who she has “seen threaten and abuse tenants, access properties at any time of the day or night. That sort of person will act in an even more irresponsible way than they already do.” Ms Pearce did accede one example she knew of a landlord suffering rental losses by a tenant.
 
Another scathing description of landlords in opposition to the Abandonment proposal, was by Labour’s Helen Hayes (Dulwich and West Norwood) – “her caseload was full of tenants who had experienced unscrupulous evictions under Section 21 and she bears witness to the distress, anxiety and homelessness caused by its use.” Labour MPs wanted to extend – double the time between the Notices, but were unsuccessful.
 

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