Landlord registration and possession notices in Wales

An unlicensed landlord needs to employ an authorised agent or solicitor in order to serve a valid notice.

The Court of Appeal handed down its judgment in Jarvis v Evans & Anor [2020] EWCA Civ 854 yesterday.

Facts

Mr Jarvis rented a house in Pembrokeshire to Mr & Mrs Evans under an assured shorthold tenancy.

Mr Jarvis served a Notice of Seeking Possession after the tenancy had become periodic.

The notice, served under section 8 of the Housing Act 1988, cited three of the statutory grounds listed in Schedule 2 to the Act, including the mandatory Ground 8 (rent arrears equivalent to two months' rent or more).

Appeal

At first instance the county court judge found Ground 8 to be proven and granted possession.

The tenant successfully appealed to a circuit judge, citing the fact that the landlord was not licensed when he gave the notice. The landlord then appealed to the Court of Appeal.

Licensing in Wales

Unlike in England the Welsh Government has created a national landlord registration scheme, under Part 1 of the Housing (Wales) Act 2014.

Residential landlords must register with Rent Smart Wales, providing details of every property which is let or marketed for letting. A failure to register is a criminal offence (s.4).

In addition, landlords and agents who undertake letting and property management activities must be licensed (ss.6-9). Licensing involves being subject to a 'fit and proper person' test, and applicants must undergo a short training course. An offence is committed if a landlord carries out property management activities without a licence (s.7(5)).

Issue

Property management activities include serving a notice to terminate a tenancy (s.7(2)). So a landlord cannot themselves serve a notice to end a tenancy if they're not licensed.

Those advising private tenants who have received a possession notice will therefore check whether the person giving the notice was licensed.

They should also check whether a landlord is registered (about which see below).

Mr Jarvis argued in the Court of Appeal that the prohibition on unlicensed landlords serving notices did not extend to s.8 notices.

Some uncertainty had arisen because an additional clause was added during the passage of the Housing (Wales) Bill. Section 44 specifically prohibits the giving of notices requiring possession under section 21 of the 1988 Act if the landlord is either not registered or not licensed.

The court refused the appeal. Section 7 prohibits the giving of any of the specified types of possession notice (which includes s.8 notices) by an unlicensed landlord. The court's reasons are given from paragraph 29 onwards in the judgment.

The fact that Mr Jarvis was the director of a company which was licensed did not help him.

Useful, not useful

The case brings welcome clarity on the ability of a registered but unlicensed landlord to give a possession notice.

However, it remains the case that landlords in this position can employ an agent or solicitor to serve the notice.

Postscript

Note that this case did not address the situation of an assured shorthold tenant receiving a s.8 notice where the landlord has not registered with Rent Smart Wales (Mr Jarvis was registered, he just hadn't obtained a licence to do the management activity for himself).

It's clear that an unregistered landlord commits a criminal offence and loses the s.21 right to possession. However, it appears they may still be able to employ an agent or solicitor to serve a s.8 notice (providing one of the statutory grounds applies). Section 7 concerns a failure to obtain a licence, not a failure to register at all. And section 44 only concerns s.21 notices, not s.8 notices.

This would be surprising and unnecessarily complex.

But then poor drafting and ineffective scrutiny of proposed legislation now seems to be an enduring theme of housing law in England and Wales.