A Guide to Section 8 and Section 21 Notices in Wales
Date: June 27th 2018
A question we are often asked by our clients when instructed to terminate a residential tenancy is, what is the difference between Section 8 and Section 21 Notices, and which one should be served on their tenant? Both forms can be used to give notice to tenants to terminate an Assured Shorthold Tenancy, but they’re distinctly different, and it’s important to serve the correct notice to avoid unnecessary delays and expense.
What is the difference between a Section 8 and Section 21 Notice?
A Section 8 Notice can generally only be served when a tenant is in breach of contract (i.e. the landlord has grounds for possession under one of the grounds listed in Schedule 2 of the Housing Act 1988). The most common ground for eviction is rent arrears. As long as the landlord has a legitimate ground for possession, he/she can serve the notice at any point during a tenancy.
A Section 21 Notice can only be served to end an Assured Shorthold Tenancy Agreement so the landlord can regain possession on the last day of the fixed term of the tenancy (or afterwards if the tenancy has continued on as a periodic tenancy). Unlike a Section 8 Notice, a landlord does not need to have any “ground” for serving the notice to regain possession of the property.
In short, a Section 8 Notice is normally served when a tenant has done something wrong e.g. fallen into rent arrears. A Section 21 Notice should be served when the landlord simply wants the tenant to vacate the property at the end of the tenancy.
Is it better to serve a Section 21, even when a tenant has breached their contract?
There is an exception to the general rule stated above.
Even, if you have valid grounds for serving a Section 8 Notice, if the current term of the tenancy has either already rolled into a Periodic Tenancy or is nearing its end date, it is probably better to serve a Section 21 Notice instead. The reason for this is because it is generally a quicker and less expensive process to obtain a possession order through the courts when relying upon a Section 21 Notice compared to a Section 8 Notice.
Where possession proceedings are commenced based on a Section 8 Notice, the court will require evidence to prove the ground(s) relied upon when serving the notice and whilst some of the grounds, if proved, will require the court to make a possession order(mandatory grounds), others will only result in the award of an outright possession order if the judge considers that to be a reasonable order in all of the relevant circumstances (discretionary grounds). In these cases, the basis of the landlord’s claim for possession can be disputed by the tenant in court, and even defeated if the alleged breach of contract has been remedied before the hearing (e.g. if possession is sought on the basis of rent arrears and the rent is brought up to date prior to the hearing). These issues may prolong the eviction process, and consequently allow the tenant to remain in the property whilst not paying any rent.
It is generally the case that a possession claim brought following service of a Section 8 Notice will require more than one court hearing before a Possession order can be secured.
In contrast, as stated above, a Section 21 Notice does not require a landlord to prove a ground for requiring possession, as long as the fixed term (or the periodic tenancy) is coming to an end. A further advantage of possession hearing based on a Section 21 Notice is that these can be dealt with by the Court on paper alone (i.e. without a hearing), which is far quicker and more cost effective than if the matter was dealt with at a hearing.
Are these completely separate notices?
It’s important to note that both sections are completely separate from one another. You can serve both at the same time (if it is appropriate).
Important considerations before a Section 21 Notice can be served.
We often find that when we are instructed by clients, crucial preliminary steps have not been complied with when the Assured Shorthold tenancy has been created, which leads to delays in starting the procedure to obtain possession of the property. Some important factors to note as are as follows: –
1. Protecting your deposit
Landlords are required to protect any tenant’s deposit as a result of legislation that came into effect on 6 April 2007. This means that all deposits taken for Assured Shorthold Tenancies after that date must protected within a Tenancy Deposit Protection Scheme (DPS).
After the deposit has been protected, certain prescribed information must also be sent to the tenant within 30 days of the deposit being protected.
The main risks of not protecting deposits are detailed below: –
- You are unable to serve a Section 21 Notice should you require possession of your property (although it is possible to return the deposit to the tenant and serve the prescribed information at a later date to enable a Section 21 Notice to be served)
- The Court may Order you to pay to the tenant compensation of up to three times the value of the deposit if claimed by the tenant.
2. Landlord Registration
Since November 2015, there is a legal obligation for all Landlords operating in Wales to register their property with Rent Smart Wales if it is let under an Assured, Assured Shorthold or Regulated Tenancy Agreement. This requirement is under Part 1 of the Housing (Wales) Act 2014. A landlord who fails to register as required will not be able to serve a Section 21 Notice prior to the property being registered.
At Swansea’s Douglas-Jones Mercer, our Property Dispute Specialists can help you with any queries you may have in relation to issues with your residential or commercial investment properties. If you have any issues in relation to the above, please contact us with any questions.