The global pandemic, Covid-19 has resulted in the Coronavirus Act (“the Act”) being introduced on the 26th March 2020, which focuses on the changes affecting us, whether it is companies or individuals. In this article, we aim to highlight a few changes in the English law being introduced by the Act.

1) Courts

The courts and tribunals use of video and audio technology is intended to reduce delays to administration of justice. So to reassure our readers, the legal sector continues to operate to ensure that affective administration of justice is being delivered to the general public.

The Act gives the government the power to act in certain key areas in response to the coronavirus crisis. The following provisions may be of particular interest to commercial practitioners.

2) Residential tenancies.

  • Notice period for section 8 notices has been extended to 3 months
  • S21 notices increased from 2 months to 3 months [Prescribed forms have changed and the notice periods may be extended further up to another 6 months]
  • The provisions of the Act are not retrospective. Landlords may still be able to rely on a section 8 or section 21 notices under the Housing Act 1988 which were served before 26 March 2020
  • The restrictions also do not appear to apply to possession claims against trespassers or to those who have remained in occupation following the termination of a licence or a common law tenancy
  • The Act does not prevent landlords from pursuing debt claims for non-payment of rent

3) Business Tenancies

  • There are more generous protections in the Act for commercial/business tenancies
  • Landlords are prevented from both the exercise of rights of re-entry or forfeiture for non-payment of rent and eviction under existing litigation for rent arrears
  • These protections apply until 30 June 2020 for now but may be extended
  • For existing litigation based on forfeiture for rent arrears, the tenant cannot be evicted until 30 June 2020, or such later date as the Secretary of State may specify
  • The above protections for the tenants do not necessarily mean that the landlord is unable to action tenant breaches at all
  • Under the Act, there can be no right of re-entry or forfeiture however it appears that a landlord is not excluded from pursuing action to recover rent which may include service charge payment, insurance, costs of keeping the building by other means of debt recovery.
  • The protections under the Act do not affect the landlord’s right to pursue other action such as:
    • Claims for debt, mesne profits or damages
    • Exercising commercial rent arrears recovery
    • Drawing down on a rent deposit
    • Claiming against guarantors
    • Serving a statutory demand
  • It may also still be possible to obtain injunctive relief against trespassers
  • A Landlord is not prevented from enforcing a right of re-entry for a breach of other covenants or denial of the landlord’s title. The landlord could conceivably, therefore, still forfeit by way of peaceable re-entry for breaches other than the non-payment of rent however this is not advised in the current circumstances
  • The Act does not prevent the landlord from serving section 146 notices.

Please note that the changes introduced by the Act are temporary.

We are all in this fight together to beat COVID-19, please be assured that the justice system continues to perform its duties.

Please do not take any legal action until you have obtained legal advice. We encourage you to you seek legal advice as to your legal position under the new Act as each case turns on its own facts.

We assure you that we will help you resolve your dispute swiftly and amicably which serves the best interests of everyone involved.

Stay home and stay safe.

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