Landlords Beware - The pitfalls of a Section 21 Notice

The standard advice to Landlords who wanted to obtain possession of their property from a tenant who had an Assured Shorthold Tenancy was to serve a Section 21 Notice. This would normally have the desired effect and the tenant would leave in a two month notice period.

However, this has changed during the last twelve months for a number of reasons.  The new Housing Benefit Rules have been introduced and this has resulted in the Landlord being unaware as to whether or not their tenant is receiving Housing Benefit and if so, the purpose for which the Housing Benefit is being used by the tenant.

The economic climate has had a considerable effect in the prospects of success for an application for possession by a Landlord with Housing Benefit tenants.

It sued to be the case that a tenant on Housing Benefit would wish to be re-housed.  However, the difficulty that the tenant would find when applying to the Council for re-housing was the length of time that it would take to find a suitable property.  It was the therefore in the tenant's interest for their Landlord to serve a Section 21 Notice.  Following service of the notice the tenant would go to the Council who would frequently re-house the tenant on sight of the Section 21 Notice.

Due to the recession Councils are no longer able to accept the Section 21 Notice as evidence of "eviction".  Landlords have therefore had to obtain a Court Order for possession before the Council would accept that there was a re-housing requirement. 

The Courts have also played a part in tightening the rules on the Landlords who serve Section 21 Notices.  The Courts have taken a more serious and detailed examination of the paperwork produced by landlords in support of their application for possession.  In the event that the Judge finds that there is an error in the Section 21 Notice, or that it has not been served in accordance with the Rules, then the application for possession might be struck out and the Landlord would have to commence proceedings for a second time.

The situation is further complicated by the recent decision of the Court of Appeal that Landlords have to show that their tenants deposit has been correctly dealt with under the Deposit Protection Scheme.  If there is any problem with the Landlord's compliance with the Deposit Scheme the application for possession based on the Section 21 Notice would be dismissed with the possibility of costs being awarded in favour of the tenant.

The other effect of the economic downturn has been the number of tenants getting into rent arrear either because they have lost their jobs, or because their earnings have been reduced.  Landlords can serve a Section 8 Notice giving two weeks’ notice of intention to issue proceedings in respect of the rent arrears but this cannot be served until at least two months of arrears have been built up.

The majority of Section 21 Notices have always worked perfectly well and have never required the Court's attention.  However, recent judicial scrutiny has resulted in the Landlords being unable to proceed to obtain and Order for Possession due to the invalidity of their Section 21 Notices.

If the tenant wishes to oppose a Section 21 Notice advice is available for that purpose from Housing Charities and the Citizens Advice Bureau.  This often causes Landlords to have to go through the Court Procedure at considerable cost and if the Court finds that there has been a technical defect in the procedure the claim will be thrown out and the Landlord will have to serve further Notices and commence new proceedings.

With the rise in the number of tenants who are in arrears with their rent and the Housing Benefit caps the number of cases of Section 21 Notices being rejected by the Courts the number of proceedings will continue to increase.

Landlords must therefore take every precaution to ensure that if Court Proceedings are necessary that the application for possession based on the Section 21 Notice will not be rejected by the Court.  RDC offer advice to Landlords and Agents for the service of Section 21 Notices and Section 8 Notices and possession proceedings.  It is only right that a Landlord following the correct procedures and using the appropriate notice should be able to regain possession of their property within a reasonable timescale and without have to expand large sums in legal costs.

For further advice concerning the service of Housing Act Notices and subsequent proceedings please contact Robert Anderson or Ram Saroop at RDC Solicitors on 01274 723858.