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The Law Commission

(LAW COM No 297)

RENTING HOMES: THE FINAL REPORT

Presented to the Parliament of the United Kingdom by the Secretary of State

for Constitutional Affairs and Lord Chancellor by Command of Her Majesty

May 2006

Cm 6781 - I £32.50 [Two volumes]

The Law Commission was set up by the Law Commissions Act 1965 for the purpose of

promoting the reform of the law.

The Law Commissioners are:

The Honourable Mr Justice Toulson, Chairman
Professor Hugh Beale QC, FBA
Mr Stuart Bridge
Dr Jeremy Horder
Mr Kenneth Parker QC

The Chief Executive of the Law Commission is Mr Steve Humphreys.

The Law Commission is located at Conquest House, 37-38 John Street, Theobalds

Road, London WC1N 2BQ.

The terms of this report were agreed on 7 April 2006.

The text of this report is available on the Internet at: http://www.lawcom.gov.uk

Cm 6781 - I £32.50 [Two volumes]

THE LAW COMMISSION

RENTING HOMES: THE FINAL REPORT

CONTENTS

Volume 1	FINAL REPORT

PART 1: INTRODUCTION	1.1
Terms of reference	1.7
Our general approach	1.9
Simplification	1.10
Increased comprehensibility	1.14
Flexibility	1.17
Two key features	1.20
Landlord-neutrality	1.21
Consumer protection approach	1.25
Provisions and terms	1.30
Relationship of the scheme to consumer protection law	1.35
Developing the scheme: consensus and controversy	1.39
The recommended abolition of ground 8 in the social rented sector	1.43
The recommended abolition of the six-month moratorium	1.51
Conclusion	1.57
Changes in the legislative context	1.58
Anti-social behaviour	1.59
Housing Act 2004	1.60
Housing conditions	1.61
Licensing of houses in multiple occupation	1.62
Selective licensing	1.63
Other control provisions relating to residential accommodation	1.64
Tenancy deposit schemes	1.65
Overcrowding	1.66
Energy efficiency	1.67
Grants to bodies other than registered social landlords	1.68
Implementation in Wales	1.69
Regulatory impact	1.79
Outline of the report and Bill	1.81

PART 2: THE SCHEME IN OUTLINE	2.1
Coverage	2.2
Contract types	2.3
Conversion of existing tenancies and licences to occupation contracts	2.4
Exceptions	2.5
Written statement of the contract	2.7
Terms of the contract	2.10
Terms relating to key matters	2.11
Fundamental terms	2.12
Supplementary terms	2.13
Additional terms	2.14
Modifying and varying the contract	2.15
Modification	2.16
Variation	2.20
Transactions relating to the contract	2.21
Lodgers	2.22
Adding a party to the contract	2.23
Sub-letting and transfers	2.26
Leaving the agreement	2.27
Obligations under the contract	2.28
Repairing obligations	2.28
Improvements	2.30
Prohibited behaviour	2.31
Obtaining a contract by deception	2.35
Uninterrupted occupation of the accommodation	2.36
Landlord’s name and address	2.37
Consultation on management matters	2.38
Terminating the contract	2.39
Possession notices	2.40
Grounds for possession	2.41
Termination by the contract-holder	2.43
Termination by joint contract-holders	2.44
Abandonment	2.47
Powers of the court	2.48
Death of the contract-holder	2.51
Joint contract-holders: survivorship	2.52
Succession	2.53
Excluded contracts	2.56
Contracts covered by other legislation	2.58
Contracts excluded on social policy grounds.	2.59
Other matters	2.63
Housing benefit	2.64
Rent regulation	2.65

PART 3: OCCUPATION CONTRACTS	3.1
Introduction	3.1
The occupation contract	3.7
Contract-holders aged 16 and 17	3.10
Exceptions	3.13
Types of occupation contract	3.18
Secure contracts	3.19
Standard contracts	3.20
Use of occupation contracts	3.22
Community landlords	3.23
Application in Wales	3.24
Ability of community landlords to make standard contracts	3.25
Conversion of standard contracts to secure contracts	3.28
Private landlords	3.32
The written statement of the contract	3.34
Content of occupation contracts	3.36
Key matters	3.37
Fundamental terms	3.40
Supplementary terms	3.45
Additional terms	3.48
Model contracts	3.49
Contents of model contracts	3.53
Landlords’ own contracts	3.54
Enforcement	3.55
Procedural sanction	3.56
Modifying and varying the contract	3.57
Modification	3.57
Variation	3.58
Secure contracts	3.59
Standard contracts	3.68
Variation by Act of Parliament	3.71
Enforcement	3.72
Conversion of existing tenancies and licences to occupation contracts	3.73

PART 4: TERMINATION OF OCCUPATION CONTRACTS	4.1
Introduction	4.1
General rules	4.4
Fundamental provisions applying to all occupation contracts	4.5
Termination before the effective date	4.6
Termination on or after the effective date	4.8
Joint contract-holders	4.9
Agreement	4.13
Repudiation by the landlord	4.14
Death of the contract-holder	4.15
Fundamental provisions applying to secure and periodic standard contracts	4.21
Contract-holder’s notice	4.21
Other provisions	4.30
Death of the landlord	4.30
Expiry of fixed term	4.32
Surrender and transfer	4.35
Rescission and frustration	4.36
Abandonment	4.37
Securing the premises	4.39
Recovery of possession	4.40
Termination by the landlord	4.44
Fundamental provisions relating to all contracts	4.46
Discretionary grounds	4.47
Mandatory ground	4.48
Procedure – the possession notice	4.49
The possession claim	4.51
Effect of possession order Removing the tolerated trespasser	4.54
Fundamental provisions relating only to standard contracts	4.57
Landlord’s notice	4.57
Mandatory grounds	4.64
Possession claim – time restrictions	4.65
Forfeiture, notice to quit and re-entry	4.68
Estate management grounds	4.69
Introduction	4.69
The estate management grounds	4.76
Joint contracts – termination	4.84
Termination by the joint contract-holder	4.86
Secure and periodic standard contracts	4.87
Fixed term standard contracts	4.90
Termination by the landlord	4.91
Prohibited conduct	4.96
Exclusion by another joint contract-holder	4.100

PART 5: POWERS OF THE COURT	5.1
Introduction	5.1
Possession claims	5.5
The possession notice	5.6
Deemed possession claims	5.7
Possession orders	5.9
Special conditions	5.11
Breach of contract	5.12
Estate management grounds	5.14
Contract-holder’s notice	5.16
Landlord’s notice	5.17
Landlord’s notice in connection with end of fixed term	5.19
Serious rent arrears	5.20
Powers of the court	5.23
Discretionary grounds	5.23
Mandatory grounds	5.27
Deception	5.28
Persons with “home rights”	5.29
Structured discretion	5.31
Relevant circumstances	5.35
General relevant circumstances	5.36
Relevant circumstances regarding the contract-holder	5.38
Relevant circumstances regarding the landlord	5.39
Circumstances regarding other persons	5.41
Special cases	5.42
Rent arrears cases	5.43
Abolition of distress for rent	5.44
Pilot schemes	5.45

PART 6: DEALING	6.1
Introduction	6.1
Adding a contract-holder to the contract	6.4
Dealing	6.6
Impact on the landlord	6.8
Permitting a person to occupy as a lodger	6.9
Creating a sub-occupation contract	6.13
Failure to comply with conditions	6.19
Termination of head contract	6.21
Extended possession order	6.26
Exclusion of contract-holder	6.29
Excluded contract-holder’s remedies	6.34
Transferring the contract	6.36
Transfer to potential successor	6.40
Transfer to another secure contract-holder — exchanges	6.46
Transfer of fixed term standard contracts	6.49
Form and effect of transfer	6.52
Form	6.52
Effect	6.54
Unauthorised transfer	6.57
Landlord and Tenant (Covenants) Act 1995	6.60
Landlord’s consent	6.61
Reasonableness	6.66
The status of the occupation contract	6.68
The premises	6.69
The circumstances of the contract-holder	6.70
The circumstances of the landlord	6.71
The proposed joint contract-holder	6.72
Transfer to a potential successor	6.74
Transfer to a secure contract-holder	6.75

PART 7: SURVIVORSHIP, SUCCESSION AND RELATED MATTERS	7.1
Introduction	7.1
Survivorship	7.4
Succession rights	7.8
Introduction	7.8
The passing of the contract on death	7.13
Persons qualified to succeed	7.17
More than one qualified successor	7.27
Effect of succession	7.28
The transfer of fixed term standard contracts	7.31
The estate management ground for possession	7.34

PART 8: REPAIRS	8.1
Introduction	8.1
Fundamental terms	8.6
Limits	8.10
Access	8.11
Parties to proceedings	8.13
Enforcement	8.14
Waste and tenant-like user	8.16
Improvements	8.17

PART 9: PROHIBITED CONDUCT AND ANTI-SOCIAL BEHAVIOUR	9.1
Introduction	9.1
Prohibited conduct	9.7
Fundamental term	9.7
Enforcement	9.8
Possession proceedings	9.8
Injunction	9.9
Exclusion order	9.10
Power of arrest	9.17
Imposition of standard contract	9.23
Promotion to a secure contract	9.32
Simultaneous proceedings	9.33

PART 10: SUPPORTED HOUSING	10.1
Introduction	10.1
The new approach	10.5
Details of our statutory scheme	10.9
Exclusion of short term provision from the statutory scheme	10.11
Exclusion of supported housing accommodation from the requirement to enter into secure contracts – the enhanced management period	10.13
Tools available to the managers of supported housing	10.14
Extending the enhanced management period	10.25

PART 11: OTHER RIGHTS AND OBLIGATIONS	11.1
Obtaining a contract by making a false statement	11.2
Protection of the right to occupy	11.4
Landlord’s name and address	11.6
Joint and several liability	11.7
Management codes and consultation	11.8
Tenancy deposits	11.10

Volume 2	Draft Rented Homes Bill

APPENDIX A: RECOMMENDATIONS FOR SUPPLEMENTARY TERMS AND OTHER MATTERS	A.1
Introduction	A.1
Supplementary terms	A.4
Recommended supplementary terms for all occupation contracts	A.4
Recommended supplementary terms for all periodic occupation contracts	A.5
Recommended supplementary terms for secure contracts	A.6
Recommended supplementary terms for standard contracts	A.7
Recommended supplementary terms for fixed term standard contracts	A.8
Other matters	A.9
Statutory Instruments relating to the model contracts	A.9
Changes to Civil Procedure Rules	A.14
Changes to legislation	A.19
Miscellaneous	A.21

APPENDIX B ILLUSTRATIVE PERIODIC STANDARD CONTRACT AND ILLUSTRATIVE SECURE CONTRACT

ILLUSTRATIVE PERIODIC STANDARD CONTRACT	B.1

ILLUSTRATIVE SECURE CONTRACT	B.2

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