By a majority of two to one, the Court of Appeal in Trecarrell House Limited v Rouncefield  EWCA Civ 760 held that a landlord is not precluded from serving a valid section 21 notice by failing to provide a gas safety certificate prior to the tenant taking occupation of the property.
Before the decision in Trecarrell, it was understood that a landlord wishing to serve a valid section 21 notice must have provided a gas safety certificate at the beginning of a tenancy. This is a requirement of Regulation 36(6)(b) the Gas Safety (Installation and Use) Regulations 1998:
“36(6) … every landlord shall ensure that —
(b) a copy of the last record made in respect of each appliance or flue is given to any new tenant of premises to which the record relates before that tenant occupies those premises …”
The issue as to whether the certificate could be served retrospectively came before the County Court in the infamous case of Caridon Property Ltd v Monty Shooltz (2 February 2018). In Caridon, the landlord sought a possession order, having provided the certificate simultaneously when serving the section 21 notice. The judge refused to grant the order on the basis that the landlord had not complied with Regulation 36(6)(b) and therefore the section 21 notice was invalid.
The judge in Caridon interpreted Regulation 36(6)(b) as precluding a landlord from serving a valid section 21 notice if they had not provided the tenant with a gas safety certificate at the beginning of the tenancy. This meant landlords were permanently left without an ability to terminate an Assured Shorthold Tenancy (AST) where the tenant was not also in breach of the AST. The judge’s rationale in Caridon must have been that the property should be safe to live in at the beginning of the tenancy, and not just when a landlord wishes to serve a section 21 notice.
In Trecarrell, the Court of Appeal held that a landlord who failed to provide a certificate at the beginning of the tenancy could now do so retrospectively, and that action would not preclude the landlord from serving a valid section 21 notice. The Trecarrell decision will be welcomed by landlords.
However, the Trecarrell decision did not address the issue whether a landlord could serve a certificate where they had failed to carry out a gas safety check prior to the tenant moving in. With one of the judges dissenting, the case could now be appealed to the Supreme Court to deal with this question.
Comment from Simon Read, B P Collins
Although legislation in the past decade has undoubtedly placed more obligations on landlords, the Trecarrell decision is consistent with other ‘olive branches’ in law. For example, landlords have the ability to return a tenant’s deposit before serving a section 21 notice where the landlord has failed to protect the tenant’s deposit in one of the tenancy deposit schemes.
However, despite the olive branch, landlords need to be acutely aware that whilst it may no longer interfere with the ability to serve a valid section 21 notice, it is a criminal offence to breach the Gas Safety (Installation and Use) Regulations 1998 (pursuant to section 33(1) of the Health and Safety Work Act 1974), with a potential fine payable to the Health and Safety Executive (HSE) and also a potential custodial sentence.
In turn, the Trecarrell decision is merely a drop in the ocean against the recent government consultation which took place between 21 July and 12 October 2019. The consultation followed the government’s announcement on 15 April 2019 that it would look to repeal section 21 of the Housing Act 1988, ending landlords’ ability to terminate an AST where the tenant was not at fault. Instead, landlords would have to rely on an even more stringent set of grounds pursuant to section 8 of the 1988 Act.
No further updates have been provided following the end of the consultation, which is not surprising given the current ongoing situations with Covid-19 and Brexit negotiations. However, landlords, property investors and lawyers alike will await the results of the consultation with great anticipation. Given the 2018 English Housing Survey found that between 2017 and 2018, out of 23.3 million households in England, 4.5 million (or 19%) were in the private rented sector, the implications of repealing section 21 of the 1988 Act will be far reaching.