Court of Appeal Grants Permission to Appeal in Welsh Section 8 Notice Case

The Court of Appeal has now granted permission to appeal in the case of Jarvis v Evans & Evans (B5/2019/2258). The appeal concerns section 8 notices and landlord licensing in Wales.

Background

Since November 2015, landlords in Wales have been required to register and obtain a licence if they carry out letting activities and property management work. Unlicensed landlords face a number of sanctions ranging from criminal prosecutions and financial penalties to rent repayment orders and rent stopping orders. Unlicensed landlords are also restricted from serving section 21 notices to terminate assured shorthold tenancies.

The key issue in this case is whether a failure to register and/or obtain a licence also prevents a landlord from serving a notice under section 8 Housing Act 1988, for example, if the tenant is in rent arrears.

The tenants, Mr and Mrs Evans, were in significant arrears resulting in the landlord, Mr Jarvis, serving a section 8 notice relying on the rent arrears grounds and commencing a possession claim. At first instance, District Judge Pratt made a possession order.

County Court Appeal

In the county court appeal, HHJ Garland-Thomas overturned the possession order on the basis that the section 8 notice was ineffective because the landlord was not registered or licensed pursuant to the requirements set out in The Housing (Wales) Act 2014 (HWA).

The tenants argued that as Mr Jarvis was the landlord and as he was not registered or licensed the section 8 notice was invalid. Mr Jarvis had completed the relevant training course but had registered and obtained a licence in the name of his company, and not in his personal capacity. However, Mr Jarvis, not the company, was the landlord in the tenancy agreement.

Mr Jarvis argued that the restrictions on terminating tenancies set out in the HWA did not apply to section 8 notices. HHJ Garland-Thomas disagreed concluding that serving a section 8 notice was ‘serving notice to terminate a tenancy’ which is a prescribed property management activity under s7. HWA 2014 and which can only be carried out if landlord is licensed. HHJ Garland-Thomas allowed the tenants’ appeal against the possession order.

Court of Appeal

The Court of Appeal has now granted Mr Jarvis permission to appeal and has set a hear-by date of 2 November 2020. In granting permission, the Court has acknowledged that the appeal raises an important legal issue which is of considerable importance for tenancies in Wales.

Among the arguments to be considered is whether the HHJ Garland-Thomas’ interpretation of the HWA amounts to a disproportionate interference with a landlord’s right to regain possession of their property when there is a legitimate reason for doing so, in this case, significant rent arrears.  While the decision will only apply to tenancies in Wales, it may also have implications for tenancies in England. We have seen how restricting a landlord’s ability to serve a notice seeking possession has become an increasingly popular method of enforcing landlords’ obligations. As the Government moves to abolish section 21 in England and reform the grounds for possession it may well be considering how to continue this trend within a new strengthened section 8 procedure. The Court of Appeal’s decision in Jarvis v Evans & Evans will therefore be highly relevant to this.

Anthony Gold are acting for the landlord in the appeal who is being assisted by the Residential Landlords’ Association (RLA).