Scottish Residential Tenancy Law Update
Paul Forrester-Smith wrote for The Scotsman
Since 1st December 2017 all new private sector tenancies in Scotland must be Private Residential Tenancies and the tenancy agreement in large part must follow the proscribed Scottish Government style.
The governing law is the Private Housing (Tenancies)(Scotland) Act 2016. That act is about to be significantly amended by the Housing (Scotland) Bill 2024.
Dealing with the law as it presently stands, an issue for landlords and potential landlords to consider is the difficulty in recovering possession of a let property if circumstances should change, you just don’t want to be a landlord any longer, or the tenant is in breach of their lease. If a tenant will not leave voluntarily following a formal Notice to Leave from the landlord, then Tribunal proceedings become necessary. All grounds for eviction are discretionary, and the Tribunal must be persuaded that it is reasonable in all the circumstances. This is the situation regardless of the level of any rent arrears, or if, for instance, the landlord needs to recover possession to live in their own property or alleviate their own financial hardship.
Our experience is that even for the most straightforward tenancy related applications to the Tribunal the matter is unlikely to get to an initial case management hearing for at least 6 months. If a full hearing is required, it will be several months after that. As one can imagine that is potentially a huge financial issue for landlords. This is not a criticism of the First-tier Tribunal but a reflection of the pressures the Tribunal system faces in processing and progressing the volume of applications lodged. Even when the matter does reach a hearing there can be no guarantee that in any particular circumstances the Tribunal will allow a landlord to recover possession. The net result is months of uncertainty and potentially great expense for both landlords and tenants.
In respect of the 2016 Act if the Landlord is serving a Notice to Leave it is important to ensure that the correct notice periods are used. Each case will turn on its own facts and circumstances, but the recent Upper Tribunal case of Halcrow v Davies & Anr provides some reassurance that a very minor error in a Notice will not be material such as to mean the landlord must start the process again.
The 2024 Bill is currently passing through Parliament. From a landlord’s perspective the major change is that in Tribunal proceedings there will be a statutory obligation on the Tribunal to consider delaying the date of eviction if reasonable to do so except in very limited circumstances. This means that a landlord can succeed in the Tribunal but still be denied recovery of their property for an unknown period. The penalty if a landlord is found to have unlawfully evicted a tenant is a maximum of 36 months rent payable to the tenant.
The present law and the changes envisaged by the 2024 Bill are weighted in favour of tenants. The downsides for landlords are the delays in the Tribunal system and the lack of certainty that a Tribunal on any given day will allow the landlord to recover his own property for whatever reason. While the interests of tenants should be protected, the question is whether a greater balance needs to be struck with the interests of landlords to encourage participation in the private rental sector.
Turcan Connell regularly advises both landlords and tenants on all aspects of private tenancies. For more information, please get in touch with Paul Forrester Smith.