Court Reform Essential for Renters’ Reform Plans to Work
Michael Gove’s willingness to meet with housing stakeholders this week is a sure sign that we are getting close to the publication of the long-awaited Renters’ Reform Bill. In fact, he was not the only member of the DLUHC ministerial team to indicate that the legislation will soon be with us. A letter from housing minister Rachel Maclean, published by the levelling up select committee, included a suggestion that it would be introduced to Parliament within the ‘next few weeks’.
It’s likely to be a busy bill, covering a lot of ground and making a lot of very significant changes to the way we operate as landlords. Focus has understandably been pulled by the removal of s21 and the grounds and processes needed to take its place post reform. Equally important however, will be the machinery of the courts system, in relation to which these reforms will succeed or fail. Despite this there is no guarantee that court reform will arrive in the near future, especially given uncertainty about the Justice Secretary’s employment prospects. (Update: Justice Secretary Dominic Raab resigned from the Government 21/04/23)
An efficient court process, that provides timely access to justice, is essential for landlords. Unlike most businesses we can’t simply terminate contracts on expiry or withdraw services for non-payment, our investment is also a home and only a judge can order possession, which is only right. However, we can’t afford for reform to overwhelm an already overstretched court service and leave landlords powerless when tenancies fail.
The Ministry of Justice’s target for hearings is eight weeks from the expiry of notice, meaning that it should take no longer than 12 or 13 weeks to obtain possession of a property. In practice, the current (median) average is closer to 22 weeks. A wait that around nine in ten NRLA members surveyed viewed as unacceptably long.
Believe it or not, this is a significant improvement on only 12 months ago when the average was more than 42 weeks and the median wait for a hearing is now less than 9 weeks.
What’s the Concern?
The problem is that today 32 per cent of possession cases are accelerated claims, relying on s21. This means there is no need for a hearing and cases can be processed efficiently without tying up court resources with unopposed, mandatory claims.
When the accelerated procedure is retired, all claims will require a hearing increasing pressure on the courts service by almost one third (in terms of case volume).
Even the Housing Select Committee has highlighted the lack of attention currently being paid to the need for court reform to accompany changes to tenure, stating in a recent report: “It is not clear whether the Government fully appreciates the extent to which an unreformed courts system could undermine its tenancy reforms.”
With no commitments to increasing court capacity it remains to be seen how the system will cope, or how long landlords will be expected to wait for a hearing or ultimately repossession.
What has the Government pledged?
In terms of court reform, the Government has discussed digitisation of processes and greater use of alternatives to going to court, such as mediation and the proposed ombudsman but when it comes to tackling practical issues with court delays there have been few firm commitments.
The main focus of its efforts to date seems to be prioritisation, which forms a significant part of its plan to reassure landlords concerned about dealing with anti-social tenants.
Prioritisation is welcomed by the majority of landlords. In a recent poll of NRLA members we found that almost eight in ten supported prioritising certain types of case. Although there was less consensus about exactly which cases were most deserving of high priority.
Which Cases Should Be a Priority?
Of 1,198 landlords who responded to this poll, almost one third agreed with the prioritisation of ASB claims before the court. However, an even larger proportion (41 per cent) supported giving priority to rent arrears cases and one in ten supported fast-tracking claims made on other grounds.
Clearly there is a desire to see the process sped up for a variety of types of claim, which would potentially defeat the object without a boost to capacity.
Of those in favour of prioritisation, the majority (72 per cent) felt that five weeks would be an appropriate length of time to process such cases, but this would almost certainly delay other lower priority claims unless capacity is increased.
When dealing with cases of anti-social behaviour or extreme arrears, being able to jump the queue will no-doubt help, but it is far from a solution to the inevitable pressure that the courts service will come under once the Renters’ Reform Bill becomes a reality.
We have written to the minister responsible for the courts and legal services, and plan to meet with him and his counterparts from DLUHC to discuss what can be done to ensure the system can cope with the changes underway.
It is a positive sign that the Secretary of State for Housing is meeting with NRLA and others, but we also need some joined up government action. Ultimately, we must see reform and investment in the court system before the no-fault process is abolished, if not it is hard to see how any claims beyond those marked as highest priority will obtain a timely hearing.