Government extends commercial possession moratorium
A useful overview of the current position for commercial landlords following the extension of the restrictions on commercial forfeiture proceedings.Read more
At present, following the Coronavirus Act 2020, both a section 21 and section 8 notice served pursuant to the Housing Act 1988 must provide the tenant with three months’ notice.
This will remain in place until 30 September 2020, although this may be extended in due course.
Until 30 September 2020, a landlord cannot forfeit a lease, whether by peaceable re-entry or court proceedings on the basis of rent arrears.
However, a lease can still be forfeited following a breach of any lease terms other than non-payment of rent. A notice pursuant to section 146 of the Law of Property Act 1925 will need to be served on the tenant, this must provide the tenant with a reasonable period of time to remedy the breach.
In March 2020, an automatic stay was put in place in respect of ongoing possession claims made under part 55 of the Civil Procedure Rules until June 2020. This was subsequently extended until 23 August 2020. This stay did not apply to claims against persons unknown (Trespassers), applications for interim possession orders or applications for agreed case management directions.
Under The Civil Procedure (Amendment No 4) (Coronavirus) Rules 2020, a new practice direction (55C) has been introduced, which deals with how possession matters will be dealt with once the automatic stay ends on 23 August 2020. This new practice direction will be in force until 28 March 2021 (“the interim period”).
Stayed claims will not be listed, relisted, heard or referred to a judge under rule 55.15 until either party has filed and served a written notice, called a reactivation notice, confirming that they wish for any of these actions to take place.
A reactivation notice must confirm the party filing it wishes for the case to be listed, relisted, heard or referred; and (except for appeals) set out what knowledge that part has as to the effect of the coronavirus pandemic on the defendant and any dependants.
Where a reactivation notice is filed and served by the claimant and the claim is based on rent arrears, the claimant will be required to provide an updated rent account for the previous two years with the notice.
Furthermore, if the court had listed a trial date before 27 March 2020, this will be vacated, and the case stayed unless a reactivation notice (and an updated rent account) is filed not less than 42 days prior to the listed hearing date.
If neither party file nor serve a reactivation notice by 16:00 on 29 January 2021, the claim will be automatically stayed. This stay will not be classed as a sanction for a breach and a mere application to lift the stay will be required rather than an application for relief from sanction.
Although the automatic stay, in reality, applies to all claims issued before 23 August 2020, the above does not apply to claims issued between 03 August 2020 and 22 August 2020. These are dealt with below, in addition to claims issued after 23 August 2020.
Where the court lists or relists a hearing, it must (unless ordered otherwise) give at least 21 days’ notice to the parties of any hearing listed or relisted in response to a reactivation notice.
Where no hearings are listed, the court will fix a date for the hearing when or after it issues the claim form. The requirement for the hearing to be listed within eight weeks will not apply during the interim period.
If a stayed claim already had case management directions in place prior to the automatic stay, when the reactivation notice is served, the party must also include a copy of the latest directions order made with proposed new dates for compliance; a draft order for any additional/alternative directions (or a written statement that no new directions are required) and details of whether the hearing can be dealt with remotely.
If other parties are not in agreement with the case management directions served with the reactivation notice, they must file and serve a response within 14 days of the reactivation notice being served.
If neither party has complied with this requirement by 16:00 on 29 January 2021, the claim will be automatically stayed. This stay will not be classed as a sanction for a breach and a simple application to lift the stay will be required rather than an application for relief from sanction.
In respect of new claims issued after 03 August 2020, the claimant must serve a notice on the defendant not less than 14 days before the hearing setting out what knowledge that party has as to the effect of the coronavirus pandemic on the defendant and their dependants.
In addition to the above, the claimant will be required to bring two copies of the notice to the hearing. If the claim relates to a case in which the Pre-Action Protocol for Possession Claims by Social Landlords applies, the claimant must also bring a notice confirming that they have complied with the Pre-Action Protocol and how the claimant has done so.
If the claimant has issued a new claim using accelerated possession proceedings, the claimant must file with the claim form for service, a notice setting out what knowledge that party has as to the effect of the coronavirus pandemic on the defendant and any dependants.
As the practice direction does not come into force until 23 August 2020, it is uncertain how the court will deal with cases issued using the accelerated possession proceedings after 03 August 2020 but before 23 August 2020, where a notice setting out what knowledge the claimant has of as to the effect of the Coronavirus pandemic on the defendant and any dependants.
This practice direction sets out the procedure until 28 March 2021, it is expected that further guidance will be given during the interim period as to how it is expected that the courts will deal with possession claims after 28 March 2021. However, it is likely that this will not be forthcoming until later in the interim period once the impact of the Coronavirus pandemic has been assessed further.
Please note, the information included in this update is correct at the date of publishing.
If you require further information or guidance on possession proceedings, please contact us on 01332 226 480 or complete the form below.
Scroll to next section
Scroll back to the top