Is change coming to the Evictions industry?

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Any firm or solicitors offering a specialist eviction service can operate under a Solicitors Regulation Authority (SRA) licence. However, if they operate without an SRA licence they will not have the legal authority to complete many parts of the process.

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Evictions ban will end on Sunday, says Master of the Rolls

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A clear indication that the evictions ban is to come to an end on Sunday has been published by the Master of the Rolls Sir Terence Etherton, leaving the government with little time or wiggle room to do a U-turn.

“If the government were to change its mind today then it would leave a lot of egg on the face of many groups and officials, so I can’t see it happening,” one lobbying organisation, which asked for anonymity, has told LandlordZONE.

Etherton has written a statement on the Courts and Tribunal Judiciary website announcing the resumption of possession cases on 20^th September, although as this is a Sunday this will mean hearings re-starting on the 21^st.

“A stay of proceedings in possession cases has been in operation, under various powers, since 26 March this year. That stay comes to an end shortly,” he says.

This hasn’t stopped the Labour party pressing the government to extend the ban, saying that “Coronavirus cases are rising, vast swathes of the country are set to be under local lockdown, and the Covid jobs crisis is set to get worse. This is no time for the Government to re-start evictions”.

Possession cases

Etherton’s statement is part of his department’s guidance on the resumption of possession cases which, most industry organisations have told LandlordZONE, gives the strongest possible indication that the government is unlikely to do another U-turn and extend the ban, despite pressure from Labour and Shelter.

Etherton also highlights the results of a judicial practice working group he put together in May, bringing together judges, court staff, government officials, legal representatives, the advice sector, and those representing landlords and tenants, mortgage lenders and borrowers. 

“Together, supported by my office, they have worked tirelessly towards the aim of ensuring that the courts are as prepared as they can be for the resumption of possession proceedings. I am immensely grateful for the work that they have undertaken led by Mr Justice Knowles,” he says.

Read the working group’s report ‘Overall Arrangements for Possession Proceedings in England and Wales’.

Read Etherton’s statement.

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Landlord Action – 3 Steps to Tenant Eviction

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The risks associated with illegal eviction missed rent payments and possible damage to your property if tenant eviction is badly handled are significantly reduced by paying for professional advice or services.

Accuracy is critical. Landlords won’t find a more accurate service.

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9 Golden Rules as courts begin to hear possession cases from 21st September

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New golden rules to sustain tenancies in the rental housing market have been published ahead of the courts beginning to hear possession cases from the 21st September: Click Here

The rules, drafted by the National Residential Landlords Association

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Universal Credit minister slammed for ‘misleading’ excuses over rent payment delays

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A leading Universal Credit specialist has criticised pension minister Will Quince for giving misleading answers to parliamentary questions from two campaigning MPs over controversial Alterative Payments Arrangements.

Quince defended the system of direct rental payments during a Commons debate, despite many landlords haemorrhaging funds trying to set up Alternative Payment Arrangements (APAs) for the housing portion of Universal Credit while Covid-related rent arrears stack up.

And many are being given out-dated advice by the Department of Work and Pensions, according to Bill Irvine at UC Advice & Advocacy, nearly four years after the policy of ‘explicit consent’ was changed.

This means landlords can wait weeks to even get an acknowledgement of their claim for APA or are told that they’re not eligible because their tenant hasn’t given authority – even though the requirement to get their consent is no longer necessary.

This all follows a debate in the Commons between MPs Bob Blackman and Karen Buck, who grilled pensions under-secretary Will Quince on whether landlords could get direct payments via APAs.

£440 million gap

Buck told the Commons: “One in eight tenants have built up arrears and there is a £440 million gap between what landlords believe they are owed and what tenants have paid.”

Quince said it was wrong to attribute a rise in rent arrears solely to the benefit. “We know that many tenants are arriving on Universal Credit with pre-existing rent arrears, which Universal Credit actually appears to be helping to clear over time. There is no wait…people can get an advance immediately.”

Irvine says that the minister’s excuses are misleading. He adds that even when an APA is awarded, payment can start then stop without notice when a tenant asks for funds to be redirected back to them.

On a whim

“The DWP are behaving on a whim by simply reverting payment back to the tenant as there’s been no change in the tenant’s circumstances since the APA was granted.”

He tells LandlordZONE that some tenants are abusing Universal Credit knowing it will be months before action can be taken.

“If the scheme was working properly, the majority of landlords wouldn’t be experiencing long-term rent arrears. It’s not, and regrettably, it’s causing unsustainable losses.”

However, a DWP spokesman says: “We have not heard anything from landlords about advice being given to the contrary or issues in relation to what you raise. Our guidance on this is quite clear.”

Watch the debate on Parliamentary TV.

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NRLA publishes “golden rules” guide for landlords

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The new “golden rules” devised by the National Residential Landlords Association, are designed to sustain tenancies in the rental housing market prior to the court’s resumption of possession case hearings from the 21st September.

The rules will form a central part of measures announced by the Government to ensure courts can start to process possession cases following the six month ban.

The document published today by the NRLA provides practical advice and support to sustain tenancies where tenants are facing financial difficulties. It includes ensuring that tenants and landlords properly communicate with each other as soon as a problem arises, that the landlord understands the tenant’s needs and circumstances.

It ensures that suitable arrangements can be agreed where possible to address rent arrears that might be building. This might include supporting tenants to access financial support that could be available, making use of guarantors or developing suitable rent repayment schedules.

The rules also include advice about access to mediation services where it might help, and warns landlords to keep written copies of all communication with tenants to prove the efforts made to sustain tenancies should the case need to come to court. Judges have made clear that they will make use of powers to adjourn cases where they feel proper processes have not been followed.

The NRLA argues that these rules, together with changes announced to the way courts operate means that possessions cases can be heard again, starting with the most urgent related to anti-social behaviour, tenants committing domestic violence and cases of extreme rent arrears.

Ben Beadle, Chief Executive of the National Residential Landlords Association, said:

“Despite the courts opening up again, it does not mean that repossessions are an inevitable consequence where tenants and landlords have struggled due to COVID-19. The golden rules published today provide all the advice needed to sustain tenancies – but it is incumbent on both parties to speak to each other.

“We welcome the framework developed by the Government to ensure courts can begin to hear possession cases again. In such challenging times they broadly strike the right balance between protecting tenants affected by COVID and the need for landlords to tackle the most severe cases including anti-social tenants and cases of extreme rent arrears.

“That said we remain concerned that the expectation for landlords, the majority of whom are not property tycoons, is to go without rent for anything up to a year before such cases are deemed a priority. Such a position is not sustainable, especially as there is almost no chance of the rent arrears being recouped. We will continue to raise the difficulties that this will cause.”

The NRLA “golden rules” can be accessed here

The Master of the Rolls (as Head of Civil Justice) established a Working Group on Possession Proceedings that has produced guidance on the overall arraganements

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Bank Base Rate remains at 0.1%

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The Bank of England Monetary Policy Committee (MPC) voted unanimously to maintain the Bank Base Rate at 0.1% and for the quantitative easing stock to remain unchanged.

Economic outlook is particularly uncertain, but the bank’s central growth projections still assume the direct impact of Covid-19 on the economy will dissipate gradually and assume an immediate

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Only a handful of campaigners gather outside parliament to call for another evictions extension

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Protesters have gathered outside Parliament in a last-ditch attempt to persuade the Government to protect renters after the eviction ban ends on Sunday.

The final push – “a socially-distanced, but spirited and angry protest” according to organiser the Homes For All group – failed to generate large crowds; in fact, according to its Facebook page, only 28 people turned up to the No Evictions protest in Parliament Square.

The group says that while the Government has made vague comments about protecting tenants from eviction, there’s nothing in writing.

Homes for All, a non-party alliance of tenants, trade unionists and local housing activists, argues that the action doesn’t honour the pledge made at the start of the Covid-19 crisis when ministers vowed that no-one would lose their home during a pandemic.

“In London today, an 83-year-old woman is being threatened with eviction by her private landlord, from a home she’s lived in for 50 years. The current eviction ban is all she has to protect her,” says Glyn Robbins of Homes for All, a housing worker.

“Our question for the Prime Minister is: where’s the promised action – or will tenants lose their homes due to the pandemic?”

Alicia Kennedy, Generation Rent director (left), adds: “When the eviction ban is lifted, renters who’ve already had notice from their landlord will have no idea what protections they’ll have left. We’re calling for emergency legislation to end coronavirus evictions and funding to end the rent debt crisis.”

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SPOTLIGHT: Why it’s time to regulate the UK’s unlicensed evictions specialists

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In the UK anyone offering a specialist eviction service can operate as as a solicitor or firm licensed by the Solicitors Regulation Authority (SRA). Or it can operate without that stamp approval, albeit without the legal authority to complete many parts of the process.

This has created a grey area into which many unlicensed firms, many calling themselves ‘lawyers’, have leapt offering cut-price services that often fail to deliver the same level of service or competencies as a licenced operation.

This grey area exists because the SRA’s remit means it can only deal with the actions of those solicitors or the firms they run under the Solicitors Act 1974.

And even if an unlicensed firm employs an in-house solicitor – which many do – they still cannot provide ‘reserved’ (see definition below) activity through organisations that the SRA does not regulate.

What does reserved mean?

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The SRA told LandlordZONE: “Our regulation is about protecting the users of legal services who have engaged a solicitor firm. We have no remit with landlords or their agents if those agents are not solicitors.”

There are dozens and possibly hundreds of companies who offer an unlicenced eviction service in the UK, often including the word ‘lawyer’ in their company names or websites who continue unchecked or policed.

“They are easy to spot because they are usually much cheaper than licenced eviction specialists,” says Paul Shamplina, star of Channel 5 TV show Nightmare Tenants, Slum Landlords.

“But all too often we pick up cases from landlords who have gone for the cheap option but who then find out that the paperwork has not been prepared properly and their cases are thrown out by the judge.”

Test case

This situation has been continuing for years, despite a test case in 2018 concerning a possession case in Birmingham (Kassam vs Singh) during which the judge made it clear that he considered the way in which unlicensed companies operate to be unlawful under the Legal Services Act 2007.

As that case also highlighted, procedural mistakes made by unregulated eviction companies can be both costly and waste a lot of time for landlords.

And without the indemnity insurance afforded by an SRA licence, landlords have little recourse other than to take the company to court to recoup their losses.

Think carefully

“We advise landlords to think carefully before instructing any firm to carry out possession services to ensure they are working with a reputable company,” a spokesperson from the NRLA told LandlordZONE.

“This should include seeking recommendations through word of mouth and searching for reviews on reliable websites. It is important also to ensure that before agreeing to use such services, landlords understand clearly the costs and what will be provided.”

Little progress has been made towards regulating or licensing the entire sector (rather than just parts of it) since the Kassam vs Singh case.

MoJ register

But official action could be forthcoming. The Ministry of Justice (MoJ) last week told an industry conference that it is considering whether to create a register of unregulated providers of legal services and give their clients access to redress if things go wrong.

Peter Rowlinson, head of UK legal services policy at the MoJ said that it doesn’t make sense that while the client of a lawyer advising on a will, for example, had the protection of both regulation, indemnity insurance and access to the Legal Ombudsman, the client of an unregulated provider did not.

In the private rental market, this issue of parallel ‘legal services’ provision is particularly pressing because many more landlords will soon be seeking help as they attempt to remove tenants who have defaulted on their rent before, during or after Covid.

Tim Frome (right), Head of Legal at Landlord Action, also says some of the cases he deals with involve letting agents who claim to have the in-house expertise to complete evictions but which in reality do not, or who use an unregulated specialist, in both cases in the hope of making extra revenue.

LandlordZONE put this to ARLA Propertymark, but it declined to comment.

“We are seeing clients come to us after using an unlicenced evictions specialist which has ended up making their situation worse after they have made basic procedural legal mistakes or, in some worse-case scenarios, blatantly lied to a landlord about their capabilities and the progress of the eviction,” says Frome.

“It is then left to licenced companies like ours to unpick the mess after the landlord has realised often too late they may have to go back to square one after months of unnecessary waiting and expense.”

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EVICTIONS: Tory faithful turn against government’s ‘anti-landlord policies’

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The Tory party faithful have begun speaking out against the Government’s private rented sector policies and its disregard for landlords.

Historically acknowledged as the party of the landlord, Conservative party member Chris Town – himself a landlord – says that by executing a U-turn on the evictions ban, the Government has lost the trust of a large number of natural Conservative supporters.

Says Town: “It’s completely unacceptable to expect landlords to undertake the responsibility of the state to subsidise those who are struggling to pay their rent.

“I might expect Labour to have no sympathy for landlords, but I would hope that a Conservative Government would show some understanding that most landlords are not wealthy and cannot afford to forgo rent for long periods of time.”

He believes interest-free tenant loans paid to landlords are the best way to cover Covid-related arrears.

“Similar schemes have already been developed in Scotland and Wales meaning once again that the UK Government is on the back foot, rather than taking the initiative to support renters and landlords,” adds Town.

Writing in The Telegraph, Baroness Altmann also supports the call for tenants’ loans, as well as loans or direct relief for landlords to tide them over their loss of income. The peer says the further evictions suspension is “not what one would expect from a Conservative government”.

She believes that many landlords, especially pensioners, are deeply disappointed that it hasn’t recognised the problems they face when tenants stop paying their rent, and urges the Government to redress the balance that has tipped so far against landlords.

“It’s time to recognise that most landlords are not heartless corporations, but decent citizens who have worked hard to invest in a property to supplement their income,” says Altmann.

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