knowledge | 6 August 2020 |
COVID-19: Residential Tenancies Revisited
Legislation enacted on 1 August 2020 continues the State’s emergency response to the difficulties faced by renters of residential property due to COVID-19. The Residential Tenancies and Valuation Act 2020 (the “Act”) provides modified protections for certain tenants to replace those provided for under initial emergency legislation. More generally, the Act also ensures that the Residential Tenancies Board must be on notice and involved at the outset with proposals to terminate tenancies generally for non-payment of rent.
Modified protections for certain tenants during emergency period
The Emergency Measures in the Public Interest (Covid-19) Act 2020 (the “Second COVID Act”) imposed a blanket ban on residential rent increases and tenancy terminations for an initial 3 month period, subsequently extended to 1 August 2020. These protections have now lapsed.
Under the new Act, notices for termination may once again be served and the protection against termination now applies only in respect of non-payment of rent. Significantly tenants must now also effectively claim the benefit of protection from both termination and rent increase by submitting a declaration to the Residential Tenancies Board (the "RTB"), with a copy to the landlord. This declaration must confirm that the tenant complies with the specific qualifying criteria set out in the Act and as a consequence, that there is a significant risk that that tenancy will be terminated by the landlord.
To qualify to submit the declaration tenant must be unable to pay rent at any time between 9 March 2020 and 10 January 2021, due to being:
- out of work due to contracting Covid-19, without entitlement to be paid; or
- in receipt of (or entitled to receive) the temporary wage subsidy or supplementary welfare allowance; or
- in receipt of any other payment out of public moneys provided to alleviate financial hardship resulting from Covid-19, including rent supplement.
The modified protections will apply to that limited category of tenant, provided the tenant submits the required declaration, between 2 August 2020 up to and including 10 January 2021 (the “emergency period”).
Potential for application of Second COVID Act to commercial tenancies removed
A late addition to the Second COVID Act extended the application of the protection against tenancy termination under that Act to residential arrangements not falling within the Residential Tenancies Acts. But it did this in a way that raised questions about its potential application to commercial tenancies. The Act now removes the relevant provision of the Second COVID Act so that it has no further effect.
Greater regulation for termination of tenancies generally for non-payment of rent
One of the grounds for termination of a tenancy during any 6 year protection period (the “protection period”) under Part 4 of the Residential Tenancies Act 2004 (the “2004 Act”) is breach by the tenant of his or her obligations in respect of the tenancy. The 2004 Act distinguishes between certain categories of breach in terms of the notice to be served, before the tenancy can be terminated. General breaches, including non-payment of rent, are subject to 28 days advance written notice. However, during a protection period, where the breach is non-payment of rent, to date an initial 14 day arrears notice was also required to allow the Tenant to pay the rent, before the 28 day notice of termination could be served. The Act now further regulates the termination by a landlord of a tenancy for non-payment of rent during a protection period by replacing the initial 14 day arrears notice with a 28 day arrears notice. That arrears notice must be in writing (in such form as may be specified by the RTB) and served on both the tenant and the RTB. This triggers an obligation on the RTB to provide the tenant with written information to enable him or her to obtain advice on money and personal debt management of the type provided by the Money Advice and Budgeting Service (“MABS”).
If the rent remains unpaid 28 days after receipt of the arrears notice by the tenant or the RTB, (whichever is later), the landlord may proceed to serve a 28 day notice of termination on the tenant with, again, and on the same day, a copy of the notice of termination required also to be served on the RTB. This triggers an obligation on the RTB to notify the tenant in writing of his or her entitlement to refer a dispute in relation to the proposed termination to the RTB for resolution. If the notice of termination is disputed the adjudicator appointed in respect of the dispute, or the Tribunal on hearing any appeal, must have regard to any advice provided to the tenant by MABS when making a decision or determination in relation to the matter.
Whether or not disputed, if the tenant is a qualifying tenant for whom the protections set out in the Act for the emergency period apply, the termination can only take effect 90 days after the notice of termination is served, or on 11 January 2021, whichever is the later.
Much of the public and political interest in this Act has been understandably focussed on the manner in which the protections introduced by the Second COVID Act are being modified and replaced. Landlords and tenants will need to understand how those modified protections apply in practice for the limited period of their application. But landlords in particular will also need to quickly adapt to the procedural changes introduced to termination of tenancies for non-payment of rent generally during a protection period. The increase in the initial warning period from 14 days to 28 days and the requirement that both the warning and the termination notice must be served on the RTB must both be complied with. The role for MABS in the resolution of disputes is new and it remains to be seen how its advice to tenants might influence decisions or determinations made in the resolution of disputes referred to the RTB.
This briefing is for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.