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  • Buy-to-Let

    Brokenshire unveils housing court proposals



    Press communication from MHCLG:

    • Communities Secretary sets out proposals to provide greater access to justice for both landlords and tenants in the event of disputes
    • Call for evidence includes a specialist Housing Court which could provide a single path of redress in property cases
    • Measures will help to build a fairer housing market that works for everyone

    Landlords and tenants are to receive faster and more effective justice in the event of property disputes, under proposals unveiled by Communities Secretary Rt Hon James Brokenshire MP.

    Government will seek views on a specialist Housing Court which, if created, would provide a single path of redress for both landlords and tenants – meaning both have the security of knowing they have somewhere to go to seek justice, with the power to resolve the dispute.

    The vast majority of landlords are responsible owners, but a number of tenants continue to live with the fear of being evicted at short notice or remain stuck in poor accommodation. With housing disputes held in a number of different legal settings, the process can be confusing and act as a deterrent to some of the most vulnerable seeking justice.

    Communities Secretary, Rt Hon James Brokenshire MP, said:

    “Everyone deserves to live in a safe and decent home, and this government is bringing about real change in making renting more secure.

    “This is particularly important for families and vulnerable tenants who live with the fear of suddenly being forced to move, or fear eviction if they complain about problems with their home. It is also important for landlords who, in a minority of cases, struggle to get their property back when they have reason to do so.

    “The proposals announced today will help ensure both tenants and landlords can access justice when they need it – creating a fair housing market that works for everyone.”

    Other proposals include reducing the need for multiple hearings in different courts, transferring certain types of housing cases between the courts and tribunal or vice-versa to ensure cases are resolved quickly and issuing new guidance to help tenants and landlords navigate their way through the legal system.

    Changes to further streamline court processes could also provide confidence for landlords to offer longer, more secure tenancies, by making it easier for responsible landlords who provide a high-quality service to regain possession of their tenancy should they need to do so.

    This is part of the £1bn Reform Programme to build a justice system that is fair, straightforward and accessible to all. It also builds upon comprehensive government action to rebalance the relationship between tenant and landlord.

    Other measures being taken include requiring all landlords, like agents, to join a redress scheme; ensuring all letting agents are members of a client money protection scheme to protect landlord and tenants’ hard-earned cash; and banning letting fees and capping tenancy deposits so that tenants have more money in their pockets.

    Responding to this announcement, David Smith, Policy Director for the Residential Landlords Association, said:

    “The RLA called for a new Housing Court at the time of the last election and in its budget submission. It therefore welcomes this important consultation.

    “Improving and speeding up access to justice in this way would be good news for landlords and tenants.

    “It will help root out criminal landlords more quickly, give tenants better ability to enforce rights granted by new legislation on property fitness, and give greater confidence to landlords to offer longer tenancies.”

    SEE ALSO  -         Budget 2018 - landlord & housing perspective

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    Will this include fast tracking deposit disputes.  Every tenant fancies their chances of disputing, no matter how obvious the damage they caused.  The amount of work and cost to us to deal with ridiculous disputes is so unfair and there should be a financial penalty to the losing party, that would get rid of the stupid claims such as drawing on the walls,trying to hide broken furniture etc.

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    I haven't read the detail but I like the idea of it being streamlined 

    Its long overdue


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    Jonathan Clarke. http://www.buytoletmk.com

    ARLA have responded to this announcement:

    David Cox, chief executive of the trade body, said: “We have long urged Government to take an holistic approach to the laws governing the private rented sector, and are optimistic that the announcement is an acknowledgement of the necessity for this approach.

    “For example, in order to address the issue of long-term tenancies, we need a properly functioning court system.

    “The creation of a Housing Court would be a huge leap forward for landlords, tenants and agents alike, and have a wholly positive impact on the sector.”

    Source of quotation

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    Sounds good,  the devil will be in the detail.

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    Will a wave of deposit protection cases hit a specialist Housing Court if one is set up in England; what does the Scottish experience show?

    • Chair of TDS highlights the numbers of tenancy deposit cases now being heard by the Scottish First-tier Tribunal
    • If a similar specialist Court was introduced in England it might deal with up to 1,200 deposit protection cases each year
    • Issue could be a factor in the ongoing MHCLG consultation on establishing a Housing Court

    The Government recently launched a consultation on setting up a specialist Housing Court in England to try to speed up the legal process for both landlords and tenants.

    Since it launched there has been lively debate, but what has been largely left out is the very recent experience for tenancy deposit-related rulings of a similar specialist Court in Scotland; through the Scottish First-tier Tribunal.

    In England, landlords who take deposits from tenants with assured shorthold tenancies (ASTs) must protect the deposit with one of three government-backed protection schemes within 30 days of receipt. Under the current system, landlords who fail to comply with the law can be liable for a penalty of between one and three times the deposit value if the tenant raises the matter with the County Court, but only a handful of cases each year seem to go through this system [although some cases may go unreported].

    In Scotland, the deposit must be protected within 30 working days from the start of the lease, and until January of 2018, tenants would need to raise a claim for non-protection in the local Sheriff Court. As in England reported cases on deposit protection were few and far between.

    However, since January 2018 all deposit-related cases are now heard by the Scottish First-tier Tribunal along with other housing cases that used to be heard in the Sheriff Court.

    The introduction of a specialist and free-to-access Tribunal in Scotland has led to a dramatic increase in the number of deposit protection cases with 91 cases having been decided since January 2018.

    Martin Partington CBE QC, Chair of Tenancy Deposit Scheme (TDS), has been surprised with the high volume of cases in Scotland. He said: “The sheer volume of cases in the Scottish example demonstrates that there’s an appetite for a specialist Housing Court that includes tenancy deposit matters.

    “If we extrapolate the Scottish figure for the size of the English private rental market, the same system could potentially see around 1,200 cases a year coming into the specialist Housing Court that is proposed.

    “The First-tier Tribunal system in Scotland has undoubtedly encouraged tenants to ensure that their deposits are protected and provided a straightforward, clear and importantly free method to seek recourse.”

    Of the 91 cases heard by the Scottish Fist Tier Tribunal this year on deposits, 88 involved landlords, and three involved agents.

    A total of 19 cases were dismissed during 2018. In some cases, the application was received after the three-month cut off period after a tenancy ends, in others where the applicant did not attend the hearing, and in some cases where the court ruled the case was not upheld.

    In 72 cases the FTT awarded a total of £45,974.38 in penalties (including return of deposits and penalties above the deposit value). Most of the cases related to landlords not protecting deposits at all or in some cases late. Many of landlords pleaded ignorance of the law but ultimately – as is also the law in England – landlords who take a deposit are obligated to protect it correctly.

    So what are the implications of this for England? Partington added: “With roughly 4.8 million homes in England[1] being rented privately, and the majority of those taking tenancy deposits, it’s essential that tenants and landlords understand their rights and responsibilities.

    “The vast majority of landlords abide by the rules, but for tenants renting from those who don’t, there should be access to a court to ensure their deposits are protected and to seek compensation. If we take the Scottish experience and extrapolate it to England this means we might end up seeing up to 1,200 cases a year on deposit protection coming to a specialist Housing Court in England.

    “The Scottish cases predominantly to relate to landlords; most of whom said that they were unaware of the legal position in relation to deposits. In our experience almost all agents and professional landlords understand their legal obligations but many smaller, accidental landlords can struggle with compliance.

    “The Scottish experience is that a specialist Tribunal with free access does encourage tenants to successfully bring cases and it is likely that the development of a similar system in England would have the same impact. ”

    The consultation on the case for a Housing Court opened on 13 November and will close on 22 January 2019. Further information is available here.

    Further information on TDS is available at https://www.tenancydepositsheme.com

    Further information on the Scottish First-tier Tribunal and its deposit-related cases is available at https://www.housingandpropertychamber.scot

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