In this audio briefing, Dearbhla Considine, Professional Support Lawyer in the Real Estate team, is joined by Órlaith Molloy, Real Estate Partner, to discuss some of the key changes to residential landlord and tenant law that our clients need to be aware of.
Hello, my name is Dearbhla Considine and I'm the Professional Support Lawyer in the Real Estate team in Arthur Cox. In this audio briefing, I will be joined by Real Estate Partner Órlaith Molloy to discuss some of the key changes to residential landlord and tenant law that our clients need to be aware of.
The Residential Tenancies and Valuation Act 2020 (the "Act"), enacted on 1 August 2020, replaces the measures put in place to protect residential tenants set out in the Emergency Measures in the Public Interest (Covid-19) Act 2020.
The Act, amongst other measures:
- replaces the general moratorium on the termination of tenancies and rent increases with more targeted protection for tenants whose rent payment capacity has been directly affected by COVID-19;
- requires landlords to notify the Residential Tenancies Board (the "RTB") of any proposals to terminate a tenancy for non-payment of rent; and
- clarifies that commercial tenancies are not affected by the prohibition on tenancy terminations.
Dearbhla: Hi Órlaith, thanks for joining me today to discuss this legislation.
Órlaith: Hi Dearbhla, glad to be here!
Dearbhla: So this legislation replaces the tenant protection measures in the Emergency Measures in the Public Interest Act 2020, passed earlier this year. The emergency period under that Act applied until 1 August 2020. How long will the measures in this new Act apply for?
Órlaith: This Act defines the new emergency period as the period from 2 August 2020 to 10 January 2021, so this is the period for which the new tenant protection measures will apply.
Dearbhla: I see, and what are the new tenant protection measures?
Órlaith: Well basically, the Act protects tenants who are in rent arrears due to COVID-19 and, as a consequence, are at significant risk of their tenancy being terminated. One point to remember is that these protections also apply to licensees of student accommodation as well as tenants of dwellings.
If a tenant satisfies the "relevant person" criteria set out in the Act and completes a declaration to this effect, their tenancy cannot be terminated or their rent increased for the duration of the Emergency Period i.e. until 11 January 2021.
Dearbhla: You mentioned "relevant person" criteria. Can you explain what that means?
Órlaith: Of course. The Act sets out the criteria that tenants must comply with before they will be protected. Tenants must be unable to pay their rent because:
- they are (or were, during the period from 9 March 2020 to 10 January 2021) temporarily out of work because they contracted COVID-19 or were a probable source of infection of COVID-19 and their employer was not obliged to pay them; or
- they were in receipt of (or entitled to receive) the temporary wage subsidy or any other social welfare payment paid for loss of earnings due to COVID-19 - this includes the rent supplement or a supplementary welfare allowance); and
- as a consequence, there is a significant risk that that their tenancy will be terminated by the landlord.
Dearbhla: Ok so the reason tenants are unable to pay the rent must be because they had COVID-19 and didn't receive sick pay or they were in receipt of social welfare because they lost their job or their salary was cut?
Órlaith: Yes, that's correct.
Dearbhla: Is there any assistance for tenants who need to make a "relevant person" declaration?
Órlaith: Yes, there is. The RTB has published guidance on its website for landlords and tenants and a template declaration that tenants can use. And by the way, the declaration must be served on the landlord and the RTB.
Dearbhla: The Act also increases notice requirements for tenancy termination for non-payment of rent during the Emergency Period. Can you give some detail on that?
Órlaith: Yes. During the new Emergency Period so until 10 January 2021, before serving a tenancy termination notice for non-payment of rent, landlords must first serve a 28 day warning notice on both the tenant and the RTB. When the RTB receives the warning notice, they must provide the tenant with information to enable them obtain advice from the Money Advice and Budgeting Service (also known as MABS) and request the tenant's consent to assist them in obtaining that advice.
If the rent arrears are not discharged within the 28 day warning period, the landlord can then serve a 28 day tenancy termination notice. The notice must be copied to the RTB who must then notify the tenant of their entitlement to refer a dispute in relation to the notice to the RTB.
Where the termination notice is served on a tenant who is protected by the Act for the duration of the Emergency Period, the termination can only take effect on the later of 90 days after the termination notice is served or 11 January 2021.
Dearbhla: So, a landlord can still serve a termination notice on a protected tenant during the Emergency Period, but the earliest the termination can take effect is 11 January 2021?
Órlaith: Yes, that's it.
Dearbhla: What about other tenants, as in those tenants who are not affected by COVID-19 but still fail to pay their rent?
Órlaith: The notice period for termination of their tenancy for non-payment of rent remains unchanged at 28 days.
Dearbhla: Ok, so the Act only protects tenants who are unable to pay their rent due to COVID-19. What about the other grounds for terminating tenancies? Can landlords now terminate tenancies, for example, because they want to sell the property or because they need the property to live in themselves?
Órlaith: Yes, they can. The protections in the previous Emergency Act expired on 1 August 2020 so landlords can now terminate tenancies on the other grounds set out in Section 34 of the Residential Tenancies Act 2004.
Dearbhla: The previous Emergency Act paused the notice period in termination notices and rent review notices that were served before 27 March 2020. What's the status of those notices now?
Órlaith: The notice periods in those notices starts to run again from 2 August 2020. For example, if a termination notice was served before 27 March 2020 and on that date, there were 30 days of the notice period left, those 30 days start to run from 2 August 2020 so the tenancy will terminate on 1 September 2020.
Dearbhla: One last question Órlaith, does the Act affect commercial tenancies at all?
Órlaith: Yes it does. Section 5(7) of the previous Emergency Act prohibited all proposed evictions in all tenancies in the State, including those not covered by the Residential Tenancies Act 2004. That sub-section was a late opposition amendment which it appears was designed to protect particular residential tenants. But it created uncertainty around the ability of commercial landlords to terminate leases of commercial property. This has now been rectified by Section 13 of the new Act which deletes Section 5(7) of the previous Act. So the uncertainty around whether commercial tenancies are affected by the prohibition has been removed.
Dearbhla: I see. So the usual process applies for terminating commercial leases for failure to pay rent or for any other breach of covenant?
Órlaith: Yes, it does.
Dearbhla: Thanks for highlighting that Órlaith. And thank you very much for joining me today to discuss the new tenant protection measures in the Residential Tenancies and Valuation Act 2020.
Órlaith: No problem, thanks Dearbhla.
Dearbhla: Thanks for taking the time to listen to this audio briefing. I hope you found it helpful. For more information on the Act, please feel free to contact a member of the Arthur Cox Real Estate team or your usual Arthur Cox contact.
This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.