The Coronavirus Act 2020 – How will this affect Landlords and Landowners?

Coronavirus and Possession Proceedings

The Coronavirus Act 2020 is emergency legislation that came in to force in the UK on 25 March 2020.  This Act has wide implications across a range of areas, including possession proceedings brought by landlords of residential and commercial premises.

For landlords of residential premises, the Act states that any notice to quit, notice of possession proceedings and any notice served under s.21 Housing Act 1988 between the 26 March 2020 and 30 September 2020 must give the tenant a minimum of three months’ notice.

For landlords of commercial premises, the Act states that a right of re-entry or forfeiture for non-payment of rent may not be enforced during the relevant period.  The relevant period began on 26 March 2020 and currently ends on 30 June 2020 but may be extended.

In addition to the above, the Master of the Rolls and the Lord Chancellor have introduced “Practice Direction 51Z” to the Civil Procedure Rules 1998.  This Practice Direction came in to force on 27 March 2020 and ceases to have effect on 30 October 2020.

Practice Direction 51Z, entitled “Stay of possession proceedings – Coronavirus”, is far more wide reaching than the Coronavirus Act 2020 and applies to any possession proceedings intending to be brought against residential tenants, commercial tenants, trespassers and squatters, as well as applying to mortgage possession proceedings.  This is irrespective of the grounds that possession is being sought and therefore, for commercial premises does not only apply to proceedings based on non-payment of rent as is set out within the Coronavirus Act 2020.

The effect of this temporary change means that all proceedings, new or existing, are hereby stayed – pausing the action – for 90 days until 25 June 2020. This period may also be extended.

What Does this mean for Landlords or Landowners?

Landlords of residential properties intending to serve a notice seeking possession between 27 March 2020 and 30 September 2020  must give a minimum of three months’ notice to the tenant to vacate the property before Court proceedings can be commenced, regardless of what ground possession is being sought on.

If a notice seeking possession has already been served the Landlord will not be required to provide a further notice to the tenant. However, on expiry of the existing notice, if Court proceedings are issued before 25 June 2020 the proceedings will automatically be suspended until 25 June 2020. Therefore no Order for Possession can be obtained until after this date.

If proceedings have already been issued and an Order for Possession has not yet been obtained, irrespective of the type of claim being brought or the grounds being used to pursue possession, these proceedings will be paused until 25 June 2020.  Therefore, no order for possession will be made before this date.  This applies whether the property is residential, commercial or land.

If an Order for Possession has already been made by a Court and the Defendant has failed to leave the property or the land, the Order will not be able to be enforced, e.g. by obtaining a warrant of possession, until after 25 June 2020.

As can be seen above, the implications of these changes are extensive and can have consequences for landlords of any type of property.  Our Landlord and Tenant Team and Commercial Property Department are able to provide specific advice based on individual circumstances.