The Court of Appeal has today handed down its judgment in the case of Trecarrell House Limited v Rouncefield (B5/2019/0499). In a 2 to 1 decision the Court of Appeal has ruled that late service of a gas safety certificate does not prevent a landlord from serving a section 21 notice on their tenant provided the certificate has been given to the tenant before service of the section 21 notice. The Court's decision will be welcomed by private sector landlords who feared that a failure to provide the gas safety certificate permanently prevented them from recovering possession of their properties.
The background to the appeal has been explored in a previous blog post here. In summary, the landlord's possession order had been overturned on appeal in the county court on the basis that the landlord had failed to provide the tenant with a gas safety certificate before she occupied the property. The gas safety certificate had been given to the tenant, but not before her occupation. In his decision, HHJ Carr relied on the earlier county court appeal decision of Caridon Property v Monty Schooltz, in which HHJ Luba QC concluded that a failure to provide the gas safety certificate to the tenant before occupation was a breach that could not be remedied late. The effect of the judges' interpretation of the law was that a landlord who had failed to provide the gas safety certificate before occupation, even if only a few days late, could not serve a valid section 21 notice. This issue has prevented many landlords in the private rented sector from being able to regain possession of properties let on assured shorthold tenancies.
The Court of Appeal rejected this strict interpretation of the law. Lord Justice Patten and Lady Justice King, in their majority judgment, decided that a failure to provide a gas safety certificate to a tenant before occupation is capable of being remedied by giving the tenant the gas safety certificate before serving a section 21 notice. Following an in-depth analysis of the legislation including the regulations that set out the prescribed legal requirements for serving a section 21 notice and the gas safety regulations, the judges concluded that the correct interpretation of the law is that, for section 21 purposes, there is no deadline for providing the tenant with the gas safety certificate.
The judges' view was that Parliament was unlikely to have intended a more draconian sanction for non-compliance in respect of new tenants than existing tenants, where the 28-day time limit for compliance set out in the gas safety regulations is expressly disapplied for the purposes of serving a section 21 notice. Among the reasons given in their decision, the judges referenced the fact that failure to comply with the gas safety regulations is punishable separately by health and safety legislation and restricting a landlord's ability to serve a section 21 notice is not the principal penalty for landlords who fail to comply with their gas safety responsibilities. The judges also cited the fact that the other pre-conditions for serving a valid s21 notice, for example, complying with tenancy deposit legislation, were capable of being remedied by the landlord prior to serving the notice.
A second issue dealt with in the appeal was whether a landlord had complied with the rules for serving a s21 notice where the gas safety certificate given to the tenant was based on a check carried out late i.e. outside the time limits required by the gas safety regulations. This had been raised successfully as a defence by a tenant in the county court case of Kaur v Griffith. The Court dismissed this argument concluding that this would not invalidate the section 21 notice. The duty to carry out an annual gas safety check is not part of the prescribed legal requirements for serving a valid section 21 notice.
Due to a factual dispute involving the service of the second gas safety certificate, the Court of Appeal was not able to determine the overall outcome of the landlord's appeal and the case will be remitted to the county court before it is concluded.
Where does this leave landlords?
The Court's decision is a good outcome for landlords. It means that where a landlord has failed to provide a new tenant with the last gas safety certificate before occupation they are able to remedy this by providing the certificate late. This will be a welcome relief to the many responsible landlords fearful that accidental mistakes in providing tenants with certificates could result in them permanently losing the ability to serve a section 21 notice.
Furthermore, a failure to complete a subsequent annual check on time will not bar the landlord from serving a section 21 notice provided the certificate is given to the tenant prior to serving the section 21 notice. Again, this will be reassuring to landlords particularly in present circumstances where arranging gas safety inspections has been a challenge.
The Court's decision, however, does not resolve all the issues that have arisen since gas safety was linked to the section 21 procedure in 2015. There are still difficult questions left unanswered by the Court's judgment. For example, what does this mean for a landlord who has failed to carry out a gas safety check at all before the tenant goes into occupation? Are they able to rectify this breach and serve a valid s21 notice? While the Court has determined that late provision of the initial gas safety certificate is remediable, they do not go so far as to say that all historic gas safety breaches, including failing to actually have a certificate before the commencement of the tenancy, are capable of remedy.
In addition, the gas safety regulations only require landlords to retain the gas safety certificate for two years from the date of the check which means even where a check has been carried out before the start of the tenancy, landlords may face difficulties remedying the breach later or proving that they have done so.
The Court of Appeal's decision has gone some way to clarifying the problematic points of law in this area but no doubt this will not be the last of the cases on these issues. For now, the importance of carrying out gas safety inspections, retaining records and providing certificates to tenants cannot be underestimated.
Anthony Gold acted for the landlord, support by the National Residential Landlords' Association. Justin Bates and Brooke Lyne of Landmark Chambers represented the landlord before the Court of Appeal.
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