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The Government’s long-awaited proposals for the abolition of Section 21 are set out in its white paper, A Fairer Private Rented Sector (June 2022), but are the proposals really all they’re cracked up to be?
The paper states that “too many tenants face a lack of security that hits aspiration and makes life harder”, and the homeless charity Shelter says Section 21 is the leading cause of homelessness and should be abolished quickly.
Section 21 of the Housing Act 1988 allows landlords to recover possession simply by following the correct procedure. If they comply with the relevant statutory requirements and an admittedly expansive range of regulations, then the court will grant possession; no reasons need be given. In common parlance, these are the “no fault evictions” that ingrain precariousness into our rental markets. Subscribers to this viewpoint emphasise that they allow the landlord to recover possession for no better reason than caprice. But there are other reasons to rely on Section 21 too, such as if landlord simply needs to sell up.
From the point of view of landlords, without Section 21 how will landlords exercise their intrinsic property rights as owners for example to sell? And from the point of view of tenants, if there is no Section 21, whatever replaces it will surely be less easy to defend. The law surrounding Section 21 is incredibly complicated – and a properly advised tenant can often find a hole to pick in Section 21 proceedings. The key difficulty for tenants then is not Section 21 itself, but a lack of availability of proper legal advice, either because there are too few legal aid providers, or because the means eligibility requirements are too restrictive and too few renters qualify.
A danger for landlords
The white paper outlines the proposed replacement for Section 21, including new mandatory grounds for possession: for example, if the landlord wishes to sell the property. How will these new mandatory grounds be worded? How mandatory is mandatory, and how does one demonstrate an intention? Will there be a requirement (as there is for some existing mandatory grounds under Section 8) that the landlord has given notice at the beginning of the tenancy that the relevant ground may subsequently be relied upon? If they have not done so, will they lose the right to evict under this ground? We all know too that life throws up the unexpected – what if a landlord desperately needs possession but for a reason that was not foreseen by Parliament in the drafting of these new mandatory grounds? Without a “no-fault no-reasons” procedure to cover the unexpected anymore, will the landlord be stuck without recourse to any eviction procedure at all? These are details as yet unknown.
A danger for tenants
In English property law, the seller of a house is not committed to a sale until contracts are exchanged, which can be months into the process. Could landlords simply state an intention to sell, or appoint estate agents to begin the process, then bring proceedings under the new mandatory ground, obtaining an order for possession, only to withdraw the property from the market once their tenants have moved out?
If this is what happens, then the courts will have to intervene sooner or later. In the Supreme Court judgment in Manchester City Council (Respondent) v Pinnock (Appellant)  UKSC 6 &  UKSC 45, Lord Neuberger referenced an earlier case appealed up to the European Court of Human Rights, Connors v The UK  HLR 52, in which it was stated that “the loss of one’s home is the most extreme form of interference with the right for respect for the home”. Courts do not evict people lightly. If the new mandatory ground lacks protections, it will be up to lawyers – and perhaps the higher courts – to implement common law protections. Courts may take a view – or lawyers may argue – that only a suspended possession order should be made until such time as contracts are exchanged for the sale, locking all parties (the court included) into a genuine, bona fide selling process. I like the idea. My only concern with it is that should Section 89 of the Housing Act 1980 apply to the new mandatory grounds as it does to current mandatory grounds, then the court will have no discretion at all to make a suspended order and will have to give outright possession in no more than six weeks.
There is even a danger for tenants if the only evictions that take place under this new mandatory ground are bona fide sales. Increasing numbers of landlords – faced with higher taxes, increasing regulation, Section 24 of the Finance Act 2015 and increasing interest rates – are looking to exit the rental market and sell up. A new and simpler mandatory ground for sale may well encourage this exit from the market.
Section 21 is said to be the leading cause of homelessness, but it seems to me that this is just a statistic. With Section 21 gone, evictions will still take place. It seems to me that the new mandatory grounds will become the leading cause of homelessness and then the Government will have a new statistic!
Only time will tell. But until more details emerge, I for one will reserve judgment as to whether or not this really is a “fairer” new deal, for either party.
About the author: Daniel Bacon is a housing solicitor at Duncan Lewis. He acts for both landlords and tenants, privately and publically funded, in a range of, including possession proceedings, matters of succession, and property ownership disputes. Contact him for advice via email DanielBa@duncanlewis.com or via telephone on 020 7275 2593.
Daniel works under housing director Manjinder Kaur Atwal who has more than 13 years’ experience in housing and property litigation law, tackling possession claims and eviction matters, landlord and tenant disputes, homelessness, housing disrepair, bringing judicial review matters, review/appeals relating to local authority housing decisions, property nuisance/negligence claims, and much more.