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Private Residential Tenancies – Notices to Leave

In this guest blog, Fiona Watson, a Partner with East Lothian based law firm, Paris Steele, offers advice for landlords and letting agents on serving a Notice to Leave. She draws on a significant recent Upper Tribunal case, which it is important for landlords and letting agents to know about. Having specialised in residential tenancy law for a number of years, Fiona is also a Legal Member of the First-tier Tribunal for Scotland, Housing and Property Chamber. Fiona advises clients on a wide range of issues relating to residential leasing, as well as residential conveyancing, private client, and family law. All views expressed here are her own.

Since the introduction of the Private Housing (Tenancies) (Scotland) Act 2016 which created the Private Residential Tenancy, many landlords and letting agents are still getting to grips with the correct way to serve a Notice to Leave where they wish to bring a Private Residential Tenancy to an end.

To serve a Notice to Leave, a landlord must be able to rely on one or more of the 18 eviction grounds which are contained within Schedule 3 to the 2016 Act. The vast majority of Notices to Leave issued to tenants are served on the basis of Ground 12, being the rent arrears ground. If the tenant fails to remove, an application for an eviction order must be made to the First-tier Tribunal for Scotland, Housing and Property Chamber.

To establish a case in Ground 12, as well as satisfying the Tribunal that there is an arrear of rent due to be paid at the date the application is heard, the Tribunal must also be satisfied that “the tenant has been in arrears of rent (by any amount) for a continuous period, up to and including that day, of three or more consecutive months.”

A recent decision of the Upper Tribunal (Majid v Gaffney and Britton, UTS/AP/10/0037) has considered the issue of service of a Notice to Leave on Ground 12, and particularly when it could be deemed to have been served prematurely and accordingly invalid on that basis.

An application was rejected by the First-tier Tribunal on the basis that the Notice to Leave had been served prematurely. The landlord served a Notice to Leave on the tenant which was dated 1 July 2019 and which stated “You are in rent arrears of £1525 from rent due 30/4/19, 31/5/19 and 30/6/19. Despite repeated reminders and promises of payment, your account remains in arrears.” The Tribunal held that this Notice to Leave had been served prematurely. At the point the Notice to Leave was served, there had not yet been three continuous months of arrears. If the arrears commenced on 30 April 2019 as the Notice itself stated, then three months of continuous arears wouldn’t have occurred until 30 July 2019. To serve the Notice to Leave before that date was premature, and the Ground couldn’t have been established at the point the Notice was served.

This decision was appealed to the Upper Tribunal, which refused the appeal. The Upper Tribunal’s decision made it clear that there must have been a continuous arrear for three months at the point the Notice to Leave is served. If not, the ground hasn’t been established.To serve a Notice to Leave without establishing the ground at that point is to threaten a tenant with eviction for something they haven’t yet done. Such an approach could be open to significant abuse.

It has been common for landlords to serve Notices to Leave early on in an arrear situation, on the assumption that by the time the notice period passes, and the application eventually gets to the Tribunal, it’s likely the tenant will have accrued three continuous months of arrears. However, the Upper Tribunal decision in Majid makes it clear that any application made against this background will be rejected on the basis of competency. Accordingly, landlords should ensure that there has been a rent arrear for a continuous period of three full months before serving a Notice to Leave. Otherwise, they may find themselves failing in their application to the Tribunal.