Coronavirus – MHCLG’s non-statutory guidance specifically relating to property guardianship

Last week, we updated you on the implications of the Coronavirus Bill 2020 for property guardianship companies. The Ministry of Housing, Communities & Local Government (MHCLG) has now also published non-statutory guidance for landlords, tenants and local authorities in the private and social rented sectors in the context of COVID-19. In this article, we highlight points specifically relating to property guardianship (references below are direct quotes and references to the guidance).

“1.2 What can I do about rent arrears?

If you fall into financial difficulties due to a change in your employment or earnings, for example, you may qualify for Universal Credit. Property Guardian licence agreements are a valid tenancy agreement for receiving housing costs support in Universal Credit.”

“1.8 I have a licence to occupy, am I protected by the Coronavirus Act?

This legislation only applies to tenants so will not apply to licences to occupy (other than a secure licence under the Housing Act 1985). We are urging the landlords of those licences to occupy to follow the same guidance and to work with renters who may be facing hardship as a result of the response to COVID-19. For detail on whether licensees will be covered by the announced suspension of possession hearings or orders, see Section 2. If you do not know whether you have a licence or a tenancy you should seek independent advice.

Government has put in place an unprecedented package to help prevent people getting into financial hardship or rent arrears, including support for business to pay staff salaries, as well as important changes to statutory sick pay and the benefits system. Furthermore, we are offering support for businesses, such as property guardian companies, so they can support their renters.”

“1.10 I’m a property guardian, how do I know if I’ve got a licence or tenancy?

Property guardianship agreements are usually offered on a contractual licence to occupy. The licence will provide the right to occupy premises in return for the payment of a licence fee or performance of a service. In law, a licence usually arises when there is no right to exclusive possession or there is no intention to enter into a legal relationship of landlord and tenant. However, if the licensee has exclusive possession, it may be a tenancy, even if the agreement calls it a licence.”

“1.11 Do I have to move if my landlord does not have a court order?

If you are a tenant, the Protection From Eviction Act 1977 means that you cannot be forced to leave your home without a court order or warrant for execution of that order. The 1977 Act also protects some people who occupy their home under a licence. Breaches of the Act can give rise to a civil action and be a criminal offence.”

“2.2 Who is covered by the suspension of housing possession cases?

All tenants and licensees who benefit from protection from eviction under the Protection From Eviction Act 1977 will be protected from possession proceedings by this measure.”

Property access and health and safety obligations

Section 3 also provides useful guidance for your continued obligations in respect of property access and health and safety obligations during the outbreak of COVID-19. We strongly recommend you read this section in full.

If you have any queries in light of the current situation, please get in touch.