“Right to Rent” New Penalties And Eviction Powers

From 1 December 2016 new criminal penalties will apply if landlords or letting agents do not comply with the “right to rent” legislation. There are also new powers for landlords to evict tenants who do not have the “right to rent”.

More information about right to rent checks can be found here. We have added a new Eviction Notice to our property portfolio and have updated our Guidance on Section 8 and Section 21 Notices. The new penalties and powers are considered below.

New criminal offence for landlords

From 1 December 2016 there is a new criminal offence for landlords where:

• premises are occupied by an adult who does not have the “right to rent”; and
• the landlord knows or has reasonable cause to believe that this is the case.

Landlords have a defence if they can show that they have taken reasonable steps to terminate the tenancy agreement and they have taken such steps within a reasonable period of time. Landlords should refer to the government publication “Immigration Act 2014: Guidance on taking reasonable steps to end a residential tenancy agreement within a reasonable time” available on the www.gov.uk website.

New criminal offence for agents

From 1 December 2016 letting agents commit a criminal offence where they:

• knew or had reasonable cause to believe that the landlord would be letting premises to an adult who did not have the “right to rent”; and
• had sufficient opportunity to notify the landlord of that fact before the landlord entered into a tenancy agreement; but
• did not do so.

Fines and prison sentences

Landlords and agents who are found guilty of these offences will face an unlimited fine and/or up to 5 years’ imprisonment. The Home Office has previously indicated that prosecutions will only target persistent offenders but this is not reflected in the wording of the legislation. Clearly all landlords and agents need to make sure they carry out right to rent checks diligently and keep proper records.

New eviction powers

New eviction powers also apply from 1 December.

The Home Secretary has the power to issue a landlord with a notice stating that one or more of the occupiers of a property do not have the right to rent. To avoid being guilty of the offence a landlord who receives such a notice must evict the tenant(s) within a reasonable period of time.

The landlord may be able to reach agreement with the tenant(s) for the tenancy to be surrendered or assigned to the tenants who do have the right to rent. If the tenancy is about to expire, the landlord may terminate it in the usual way by serving a Section 21 Notice. However, if these options are unavailable to the landlord, the Immigration Act 2014 contains new eviction powers.

If the notice refers to a sole occupier or to all the occupiers of a property, the landlord has the power to terminate the tenancy by serving a notice under Section 33D(3) of the Immigration Act 2014. This gives the tenant(s) 28 days’ notice to leave the property. Such a notice is enforceable as if it were an order of the High Court. This means the landlord will not need to go to court before appointing bailiffs (or evicting the tenants himself or herself).

If the Home Secretary’s notice refers to one or more occupiers of the property, but not all of them, the landlord must serve a Section 8 notice, relying on the new Ground 7B (relating to the immigration status of one or more occupiers). The Court may decide, instead of ordering possession, to transfer the tenancy to the remaining tenant(s).

These new eviction powers are controversial and it remains to be seen how frequently they will be used.