What property remedies are available during the Covid-19 lockdown?
- Category: Commercial
- 22nd April 2020
by John Aldis, Barrister
This article should be read in conjunction with an article on “urgency” in the Business & Property Courts in Birmingham prepared by James Morgan QC and me found here, (https://st-philips.com/how-urgent-is-urgent-prioritising-of-work-in-the-business-and-property-courts-in-birmingham/ NB that article was written before the new paragraph 2A was added to PD 51Z.
Practice Direction 51Z, which came into force on 27 March 2020, has imposed a general 90-day stay on new and current Part 55 possession proceedings with (as of 20 April 2020) limited exceptions in a new paragraph 2A. It provides that:
“2. Subject to paragraph 2A, all proceedings for possession brought under CPR Part 55 and all proceedings seeking to enforce an order for possession by a warrant or writ of possession are stayed for a period of 90 days from the date this Direction comes into force.
2A. Paragraph 2 does not apply to—
(a) a claim against trespassers to which rule 55.6 applies;
(b) an application for an interim possession order under Section III of Part 55, including the making of such an order, the hearing required by rule 55.25(4), and any application made under rule 55.28(1); or
(c) an application for case management directions which are agreed by all the parties.
- For the avoidance of doubt, claims for injunctive relief are not subject to the stay in paragraph 2, and the fact that a claim to which paragraph 2 applies will be stayed does not preclude the issue of such a claim.”
In summary therefore, without attempting to provide an exhaustive list, the 90-day stay applies to:
- All tenants and licensees who benefit from protection from eviction under the Protection from Eviction Act 1977. This includes most tenants in social housing and the private rented sector and some licensees;
- Mortgage repossession claims;
- Possession claims brought by landlords against leaseholders on the basis of forfeiture; and
- Residential occupiers who have become trespassers as the result of a notice to quit.
The 90-day stay does not apply to:
- Lodgers and those occupying holiday lets, hostel accommodation and accommodation for asylum seekers (because they all occupy premises under tenancies or licences which are excluded from protection from eviction under ss.3 and 3A of the Protection from Eviction Act 1977);
- Possession claims against trespassers who are persons unknown (CPR 55.6); and
- Possession claims against trespassers for an Interim Possession Order falling within Part III of CPR 55. For this part to apply the claimant must, inter alia, have had an immediate right to possession of the premises throughout the period of alleged unlawful occupation; and the occupier must not have entered or remained on the premises with the consent of a person who, at the time consent was given, had an immediate right to possession of the premises.
Housing Act 1988
Sections 8 and 21 of the Housing Act 1988 are amended so that at least three months’ notice must be given of the intention to bring possession proceedings (Sch.29, paras.6 and 7 of the Coronavirus Act 2020).
Excluded tenancies or licences
Where a person occupies premises under an excluded tenancy or licence there is no requirement to issue possession proceedings once the lease or licence is determined (ss.3 and 3A of the Protection from Eviction Act 1977).
However, it is generally not advisable to exercise self-help measures against an occupier who refuses to vacate – not least because it is an offence to use or threaten violence to secure entry to a premises (s.6 of the Criminal Law Act 1977). Some landowners may therefore be unable to enforce their right to possession in relation to those occupying under excluded tenancies or licences until the 90-day stay is lifted.
Urgent claims against trespassers to which the stay applies
CPR 55.1(b) defines “a possession claim against trespassers’” as “a claim for the recovery of land which the claimant alleges is occupied only by a person or persons who entered or remained on the land without the consent of a person entitled to possession of that land but does not include a claim against a tenant or sub-tenant whether his tenancy has been terminated or not”.
This means that there are some trespasser possession claims which are not excepted from the general 90-day stay by the new paragraph 2A of PD 51Z. For example, licensees who have become trespassers as the result of a notice to quit are protected by the stay.
PD 51Z therefore creates some tension with PD55A paragraph 1.3(3) which accords special status to certain exceptional and urgent claims against trespassers. Paragraph 1.3(3) provides that where “the claim is against trespassers and there is a substantial risk of public disturbance or of serious harm to persons or property which properly require immediate attention” this may justify starting the claim in the High Court.
The Practice Note Chancery Division and Queen’s Bench Division of the High Court in London (as annexed in the White Book to at 55APN.1) gives the following examples of such cases:
“6. Claims involving a substantial risk of public disturbance and/or serious risk of harm to persons, particularly where the disturbance may be widespread, will often be suitable for the High Court. Such cases may also involve a serious risk of harm to property.
- The class of cases involving a serious risk to property is likely to be wide with only a few such cases warranting issue in the High Court. A substantial risk of harm to property may be linked to a substantial risk to persons.
- Harm to property need not be long-lasting or permanent. An example of such a case is where there has been substantial tipping of waste material on commercial property. Further tipping may be likely and urgent steps may be required to prevent further harm to the property. Waste material may contain substances which are dangerous and pose a hazard to anyone gaining access to the site.”
Since Practice Direction 51Z imposes a stay on all CPR Part 55 possession claims subject to limited exceptions, if urgent court intervention is required to prevent serious risk of harm to persons or property being caused by trespassers (and CPR 55.6 or Part III of CPR 55 do not apply) it may be necessary to seek injunctive relief in addition to, or as an alternative to, possession.
The exceptional and urgent matters listed in the Practice Note Chancery Division and Queen’s Bench Division of the High Court in London are good examples of injunction applications that should be prioritised by the High Court. However, there are less exceptional but nevertheless urgent matters which may be suitable for speedy resolution in the County Court during the lockdown.
Practice Direction 51Z does not affect claims for an order for sale brought under the Trusts of Land and Appointment of Trustees Act 1996. However, it may be difficult to persuade the court to deal with such cases on an urgent basis when the housing market itself is at a virtual standstill.
Forfeiture of Business Tenancies
Section 82 of the Coronavirus Act 2020 provides that:
“(1) A right of re-entry or forfeiture, under a relevant business tenancy, for non-payment of rent may not be enforced, by action or otherwise, during the relevant period.
(2) During the relevant period, no conduct by or on behalf of a landlord, other than giving an express waiver in writing, is to be regarded as waiving a right of re-entry or forfeiture, under a relevant business tenancy, for non-payment of rent.”
“Relevant business tenancy” is defined as a tenancy to which Part II of the Landlord and Tenant Act 1954 applies (or would apply if the relevant occupier were the tenant). “Rent” includes any sum a tenant is liable to pay under a relevant business tenancy (i.e. it includes service charges and insurance rent). The relevant period ends on 30 June 2020.
This provision protects business tenants by ensuring that they cannot be evicted by re-entry for non-payment of rent.
However, it preserves the rights of landlords by:
- Allowing re-entry for breaches of other covenants which are caught by a forfeiture clause (although the reasonable period of notice to remedy a remediable breach in a s.146 Law of Property Act 1925 notice may need to be longer than usual due to the lockdown); and
- Providing that the use of other means of enforcement (such as Commercial Rent Arrears Recovery) will not amount to a waiver of the right of forfeiture.
Claims for injunctive relief are not stayed by Practice Direction 51Z. Therefore, landowners are still able to seek the court’s relief in relation to trespass, obstruction of rights of way, breaches of covenant and nuisance, for example. However, only urgent matters are likely to prioritised and progressed during the lockdown.
Covenants of repair
The Ministry of Housing Communities & Local Government has released a non-statutory paper entitled Coronavirus (COVID-19): Guidance for Landlords and Tenants which provides guidance on covenants of repair. It states that “landlords’ repair obligations have not changed”, but “in these unprecedented times we encourage tenants and landlords to take a pragmatic, common-sense approach to non-urgent issues which are affected by COVID-19 related restrictions”.
It defines urgent health and safety issues as:
“[T]hose which will affect your ability to live safely and maintain your mental and physical health in your home. This could include (but is not limited to):
- If there is a problem with the fabric of your building, for example the roof is leaking
- If your boiler is broken, leaving you without heating or hot water
- If there is a plumbing issue, meaning you don’t have washing or toilet facilities
- If your white goods such as fridge or washing machine have broken, meaning you are unable to wash clothes or store food safely
- If there is a security-critical problem, such as a broken window or external door
- If equipment a disabled person relies on requires installation or repair.”
Accordingly, tenants and landlords can still expect each other to attend to urgent matters falling within their covenants of repair; and tenants should provide access to their landlords to carry out such repairs.
In especially urgent cases where the covenantor refuses to perform, injunctive relief will be available. Claims for non-urgent injunctions and/or damages may also be issued but will not be prioritised during the lockdown.