LEGISLATION AFFECTING LANDLORD AND TENANT

RELATIONS• Introduction

• New and Proposed Legislation

• The Residential Tenancy Law (“RTL”)

• Ongoing policy development

• Questions and Discussion

Current legislation affecting residential tenancies

• Loi (1919) sur la location de biens-fonds

• Loi (1946) concernant l’expulsion des locataires réfractaires

• Dwelling Houses (Rent Control) (Jersey) Law 1946

• Dwelling Houses (Rent Control) (Standard Tenancy Agreement) (Jersey) Regulations 1993

New and Pending Legislation (1)

• During the 1990’s Working Parties reviewed:

1 - Landlord and Tenant obligations

2 - Eviction procedures and security of tenure provisions

• Standard Tenancy Agreement resulted from the first review

• Residential Tenancy Law from the second

New and Pending Legislation (2)

• Control of Housing and Work (Jersey) Law 201- was adopted in July 2011

• Expected to come into force in mid 2012

• Registered individuals (“unqualified”) will be able to enter a lease for Registered (“unqualified”) property on the condition that the unit satisfies the criteria in Article 2 of the RTL

• Some units of accommodation in lodging houses will qualify as self-contained units under the RTL

• Security of tenure and other protections afforded by the RTL will therefore apply to Registered persons renting such units

Residential Tenancy (Jersey) Law 201- Strategic Overview

• Law will affect over one third of the Island’s population

• It will replace outdated legislation written in French

• It is intended to create a fair balance between the rights of landlord and tenant

• It puts into one law key legislative policies affecting landlord and tenant

• It adds clarity as to legal processes affecting the parties

• It is designed as a framework which can be built upon by Ministerial Orders or Regulations passed by the States (Articles 23 and 24)

• Jurisdiction for all matters relating to residential tenancy disputes is given to the Petty Debts Court (“the Court”) (Article 16)

Summary of Sections of the RTL• Definitions and what the Law applies to

• Essential provisions of residential tenancy agreements

• What agreements must specify and contain

• Notice provisions

• Remedies

• Eviction processes

• Miscellaneous Provisions

Definitions in the RTL (1)

• RTL applies to:

- residential tenancy agreements (Article 3)

- a “residential unit” (Article 2)

• “Landlord” is a person who “grants the right to occupy” (Article 1)

This definition includes:

- Private individuals - Companies

- The States - Housing Trusts

- a tenant who enters a tenancy agreement offering a right to occupy a unit subject to the RTL (sub-tenancy)

Definitions in the RTL (2)

Article 1: “Residential unit” means:

A self-contained unit for the exclusive use of the inhabitants, comprising:

- a shower or bath- a washbasin- a kitchen- a sleeping space- a lavatory

• The above need not all be in separate rooms

What the RTL applies to (1)Article 2:

A residential unit does not fall under the Law if the unit is:

- any part of a hotel or any part of premises ordinarily used for holiday purposes

- any part of an educational institution, hospital, hospice,nursing home, shelter or residential home

- any part of a club offering sleeping accommodation to its members

Unless the unit is used as a place of residence by an employee of such an establishment

What the RTL applies to (2)Article 3:Law applies to residential tenancy agreements made:

- after commencement of the Law- renewed or varied after commencement of the Law

Law does not apply to:- an agreement continuing by tacit reconduction until renewal or variation of that agreement

- a contract for occupation of a unit in a nursing home

- occupation as a boarder, lodger or licensee

- a stay in a unit of up to 3 months for a holiday

What the RTL applies to (3)

Article 1: A residential tenancy agreement must be -

• for the exclusive occupation of a residential unit

• for value (i.e. consideration or payment )

• for a period of 9 years or less and with or without a specified term

Note: Contract leases will remain outside of the RTL and will remain subject to the jurisdiction of the Royal Court

Essential provisions of the RTL (1)

• Article 4: Tenancy agreements must:

- be in writing

- signed by or on behalf of both parties

- include the details in Schedule 1

- set out provisions to the effect of those set out in Schedule 2

Essential provisions of the RTL (2)• Schedule 1: What an agreement must specify

- description sufficient to identify the unit

- date when tenancy commences

- date (if any) when tenancy or term ends or condition (if any) upon which tenancy ends;

- name of landlord

- if any, name and address of managing agent or, if not,business address of landlord

- rent payable; frequency; to whom payable and how

- amount of any deposit; how and when to be repaid

- if at all, when, and on what basis, rent to reviewed

- inventory of landlord’s movables

Essential provisions of the RTL (3)

• Schedule 2: Provisions that an agreement must contain

- tenant may remove his fixtures and fittings subject tomaking good any damage resulting

- if landlord’s consent is required before tenant doessomething such consent is not to be unreasonably withheld or delayed

- tenant is not required to purchase any fixtures, fittings or movable property in respect of the unit

- tenant is not required to pay any premium or key money

Notice provisions in the RTL (1)

• Notice provisions: Articles 6 and 7

• New provisions for both landlord and tenant

• Applicable only to periodic tenancies

• The provision of adequate notice to tenants was a key principle of the Working Party’s proposals

Notice provisions in the RTL (2)

• Articles 6 – 7: Notice provision requirements:

- notice must be in writing

- signed by or on behalf of the landlord / tenant

- be in the form prescribed by the Minister (if one is prescribed)

- be served on the landlord / tenant

- if given by a landlord be served 3 months before it is due to take effect

- if given by a tenant be served 1 month before it is due to take effect

• Minister does have the power to prescribe a different notice period to the 3 or 1 month period specified in the Law, which might be lower

• Minister can also prescribe that a different notice period might apply to different classes of cases

Remedies in the RTL (1)• Articles 8 -10: Clarity is added by including specific remedies:

- the parties are given specific access to the Court in anumber of circumstances

- the Court has the power to vary or terminate an agreement in such circumstances if it considers it just to do so:

Article 8: for example - a service element is impossible to fulfil- the agreement is not in writing - it is not signed by or on behalf of the parties- it fails to contain the details in Schedule 1- the tenant is not given one working day in which to read the agreement

Article 9: - premises uninhabitable

Article 10: - breach by landlord of tenant’s right of occupation and enjoyment of the unit

Remedies in the RTL (2)

• Articles 11-12: Eviction processes

• Article 11: Court can order eviction of a tenant where failure to give vacant possession and tenancy has ended

• Article 12: New 7 day notice provision by landlord to tenant - tenant to be served with notice of breach of agreement

- given 7 days to cease/ take reasonable steps to cease conduct

- if tenant fails to comply landlord can apply to the Court foran Order to terminate the agreement / evict the tenant

Note: 7 day notice remedy does not depend on service of a Notice to Quit on the tenant

Eviction processes in the RTLClarity given to eviction process:

• Article 13: Execution of Eviction Order: As now, Viscount given powers to execute Order made by the Court

• Article14: Stay of Eviction:Adds clarity by referring to the process whereby the Court can stay the eviction dependent on conditions being satisfied

• Article 15: Matters for Court to consider on stay of an evictionAdds clarity by listing a number of criteria that the Court

a) shall consider andb) may consider

before deciding whether a stay should be ordered on an eviction.

Miscellaneous provisions in the RTL

• Additional provisions adding clarity:

Article 19: places an obligation on the landlord to provide the tenant,as soon as possible, with:

- a copy of the duly signed tenancy agreement / varied orrenewed agreement

- a receipt for any deposit paid

Article 20: Confirms that the parties can terminate an agreement by mutual agreement

Article 21: Confirms that the parties cannot contract out of any provisionof the RTL

Ongoing Policy Development (1)Tenants Deposit Scheme

• A draft Regulation will be published shortly to raise awareness and for comment

• A custodial scheme is proposed:

- deposits to be held by a third party

- to be repaid to the parties upon notification of agreement as to the amounts to be returned

- dispute resolution process for cases where dispute

Ongoing Policy Development (2)Forthcoming Consultation:

• On Orders to be introduced by the Minister under Article 23 for:

- condition reports

- a standard form of tenancy agreement

- standard forms for use when notice is given under the RTL (Articles 6, 7 and 12)

• A Regulation to be introduced by the States under Article 24 for:

the addition of 3 new provisions in the RTL making reference to the following issues compulsory in all residential tenancy agreements:

- responsibility for damage and repair

- sub-letting and assignment conditions

- insurance obligations

Ongoing policy development (3)

• Work is ongoing on the following issues:

- Review of Lodging House legislation and policy

- The future of the Dwelling Houses (Rent Control) (Jersey) Law 1946 and the Standard Agreementissued under the accompanying Regulations

LEGISLATION AFFECTING LANDLORD AND TENANT

RELATIONS

QUESTIONS AND DISCUSSION