Court of Appeal grants landlord permission to appeal in section 21 notice gas safety case

The Court of Appeal has granted the landlord permission to appeal in the case of Trecarrell House Limited v Rouncefield (B5/2019/0499). The appeal deals with the issue of whether a landlord can serve a valid section 21 notice when the gas safety certificate has not been given to the tenant before they moved into the property. This is an issue which has caused landlords, practitioners and judges considerable difficulty since the rules relating to section 21 notices were amended by the Deregulation Act in 2015. Therefore clarity in the form of a decision from the Court of Appeal is eagerly awaited.

Background

Section 21 Housing Act 1988 provides landlords with a ‘no explanation’ route to possession for properties let on assured shorthold tenancies (ASTs). While a landlord does not have to provide a reason for seeking possession they do need to comply with certain procedural requirements including giving the tenant a section 21 notice.

The Deregulation Act 2015 made changes to the section 21 procedure by creating further requirements which landlords must comply with to serve a valid section 21 notice. The existing duty on landlords to provide tenants with a gas safety certificate was made a pre-condition for serving notice.

In the case of Trecarrell v Rouncefield the landlord did not provide the gas safety certificate to the tenant before or at the commencement of the tenant’s AST. However, a copy of the gas safety certificate was given to the tenant prior to the landlord serving the section 21 notice. The landlord issued a claim for possession in the County Court which was defended by the tenant. One of the tenant’s arguments was that the landlord’s failure to provide a gas safety certificate at the outset of the tenancy prevented the landlord from relying on the section 21 procedure.

At first instance, Deputy District Judge Rutherford granted the landlord a possession order. He concluded that there was no requirement to serve a gas safety certificate in this case because there was no gas appliance in the demised property. In any event, provided the gas safety certificate was given to the tenant before service of the section 21 notice then the notice was valid. The judge took the view that the relevant legislation and regulations did not prevent a landlord from remedying a breach before serving a valid notice.

County Court Appeal

The tenant appealed to a Circuit Judge who allowed the appeal. HHJ Carr, assisted by the earlier County Court appeal decision of Caridon Property Ltd v Monty Schooltz, held that the landlord’s failure to provide the gas safety certificate before the tenant occupied the property was a breach that could not be rectified later. It meant that the section 21 procedure was not available to the landlord at all. The judge also concluded that the obligation on the landlord in this case was to display a copy of the gas safety certificate, rather than give it to the tenant, as gas was not supplied directly to the tenant’s flat. However, this was not a crucial distinction because it was accepted that the gas safety certificate had neither been given to the tenant nor displayed in a prominent place before the commencement of the tenancy.

The effect of the two county court appeal decisions has been wide-reaching. While neither decision is binding, district judges have been treating the decisions as persuasive authorities. Currently, a landlord who has not served the gas safety certificate before the tenant occupies the property faces the prospect of being unable to use the section 21 procedure with the tenant effectively gaining the protection of a fully assured tenancy with lifetime security of tenure. The only way a landlord in such a position can regain possession is through serving a section 8 ground-based notice. Depending on the circumstances there may not be any grounds available to the landlord.

Issues to be determined by the Court of Appeal

The central issue before the Court of Appeal is whether a landlord, who has provided the tenant with a copy of the gas safety certificate at any time prior to serving a section 21 notice, has complied with the prescribed requirements necessary to serve a valid notice. In other words, if the gas safety certificate was not given to tenant before they occupied the property, is this a breach that may be rectified later?

In granting permission to appeal, the Court of Appeal has recognised that there is an important point of principle which needs to be determined by the Court. As part of this, the Court of Appeal will need to consider whether HHJ Carr’s interpretation of the legislation and regulations amounts to an interference with a landlord’s right to peaceful enjoyment of their possessions under the European Convention on Human Rights.

Given the current uncertainty in this area, a binding senior court decision on this issue will be welcomed by many. Anthony Gold are acting for the landlord in the appeal who is being assisted by the Residential Landlords’ Association (RLA).

The court’s role in this case is limited to deciding how the current rules surrounding section 21 notices should be interpreted and political questions about whether section 21 should be abolished or reformed will not be directly addressed by the Court of Appeal.