Gas Safety Certificate:
According to a press release issued today by the National Landlords’ Association (NLA), The Ministry of Housing, Communities and Local Government (MHCLG) “will not act to help the thousands of landlords who may have inadvertently granted Assured Tenancies instead of the Assured Shorthold Tenancies they meant to.”
The Ministry has confirmed to the NLA that it does not intend to legislate to address the ruling in Caridon Property Ltd v Monty Shooltz.
Section 21A of the Housing Act 1988 (amended by the Deregulation Act 2015) says that for tenancies entered into after 1st October 2015, a valid Section 21 Notice cannot be served if the landlord is in breach of a “prescribed requirement”. Along with serving a current Gas Safety Certificate, an EPC, the government’s “How to Rent” guide, and prescribed information about a deposit, one of the prescribed requirements is that the landlord must have complied with any statutory health and safety obligations.
To do this fully the Assured Shorthold Tenancy Notices and Prescribed Requirements (England) Regulations 2015 (the “AST Regulations”) list the requirement to provide a tenant with a gas safety certificate in compliance with the Gas Safety (Installation and Use) Regulations 1998 (the “Gas Safety Regulations”), crucially, BEFORE the tenancy starts.
In the Shooltz case, the judge ruled that the requirements of the Deregulation Act 2015 meant that failure to issue a gas safety certificate, even when the gas system is still legally in test, BEFORE a tenancy begins, invalidates any subsequent Section 21 notice for repossession.
Accordingly, by applying a strict interpretation to the wording of the original Gas Safety Regulations, the judgement condemns landlords who have carelessly let properties without first issuing a gas safety certificate, to an assured tenancy.
Despite some experts arguing that this was not the intention of the Deregulation Act 2015, the MHCLG’s refusal to act means that in practice it gives tenants security of tenure such that they will be almost impossible to remove in the future without a serious break of contract, serious rent arrears for example.
MHCLG say they will be updating guidance available to landlords on the Gov.uk website, “to ensure landlords are certain of their legal responsibilities.”
NLA Chief Executive Officer Richard Lambert said:
“Having pressed the Government to respond to this judgement for nearly a year, their answer seems to be, ’We’re not that bothered’.
“The Ministry clearly doesn’t understand the impact it is having. The NLA Advice Line is taking more and more calls from landlords who thought they had complied with the law and now find themselves facing a disproportionate penalty for an administrative error. We cannot believe this is what Parliament actually intended.
“The NLA recognises the vital importance of ensuring landlords arrange an annual gas safety check with a Gas Safe engineer. But we do not support the de facto introduction of assured tenancies because landlords cannot rectify an unwitting error made before a tenancy begins.
“We have no intention of letting this rest and will continue to lobby for change.”
The case highlights the crucial importance of providing the correct documentation when setting up a new tenancy, and making sure that landlords and agents have proof that the information has been provided – attaching everything to the letting agreement, and making a signed copy of everything, is an exellent precaution.