Can a Landlord Serve a Notice to Leave in Anticipation of Arrears?

The Private Residential Tenancy regime provides that “it is an eviction ground that the tenant has been in rent arrears for three or more consecutive months” (Ground 12 of Schedule 3 of the Private Housing (Tenancies) (Scotland) Act 2016).

There appears to have been a perception that a landlord could serve a Notice to Leave relying on this ground as soon as a tenant entered into arrears. The landlord would then delay raising proceedings until such time as three consecutive months of arrears had accrued.

The purpose of this course of action was to avoid a further period of arrears waiting for the notice to go live before formal eviction action could commence.

The Upper Tribunal considered Notices to Leave served in anticipation of the rent arrears ground in the case of Majid v Gaffney and Britton. In this case the landlord served a Notice to Leave on 1 July 2019. The notice 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 First-tier Tribunal held that for Ground 12 to be relied upon the tenant must have been in rent arrears for three or more consecutive months as at the date of the Notice to Leave. Furthermore, if the tenant was first in arrears of rent as at 30th April 2019 then the expiry of the three month period would be 30th July 2019 and not 1st July 2019 when the notice was served.

The action was dismissed. The applicant landlord appealed to the Upper Tribunal contending that there is no requirement in private residential tenancy legislation for the ground of eviction to apply when the Notice to Leave is issued i.e. it can be served in anticipation.

The Upper Tribunal held that the ground for eviction must be satisfied at the date of service of the Notice to Leave. Accordingly, notices relying on Ground 12 can only be served when the tenant is in three consecutive months of arrears.

The First-tier Tribunal is bound to follow this Upper Tribunal decision. Accordingly, landlords must ensure that they only serve a Notice to Leave under Ground 12 once the tenant has been in rent arrears for three or more consecutive months.

Landlords may feel aggrieved by this decision. However, they should bear in mind that this ground still appears to be more favourable to landlords than the rent arrears ground under the old assured and short assured tenancy regime. Under the old regime, three months total of arrears was required before a notice could be served whereas now all that is required is any level of arrears over the relevant period.

Should you have any questions in relation to serving notices, please do not hesitate to get in contact with our Private Rented Sector Team.

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