On 8 November 2024, the Hon. Mr. Justice Griffiths and His Honour Judge KC, provided significant clarification on key provisions under the Renting Homes (Wales) Act 2016 and its supporting regulations. This decision underscores the Act’s emphasis on consumer protection, particularly regarding landlords’ obligations to ensure properties are fit for habitation.
The case focused on several pivotal points within the 2022 Supplementary Provisions, specifically paragraph 11, which states, “[t]he contract-holder is not required to pay rent in respect of any day or part day during which the dwelling is unfit for human habitation.”
Additionally, under paragraph 6 of the Renting Homes (Fitness for Human Habitation) (Wales) Regulations 2022, landlords must obtain and provide an Electrical Condition Report (ECR) for a property at least every five years. Sub paragraph (6) states that: “A dwelling is to be treated as unfit for human habitation at a time when the landlord is not in compliance with a requirement imposed by this regulation.”
The regulation treats a property as unfit if the landlord fails to meet this requirement.
In this case, although the community landlords had obtained satisfactory ECRs, they failed to serve them on contract holders, raising questions of whether contract holders could withhold rent. It was estimated that this oversight involved potential liabilities totalling £50 million. The landlords sought clarity through declaratory relief on five issues related to contract holders’ rights and landlords’ obligations under these regulations.
Key Issues and Findings
- Withholding of Rent Due to ECR Non-Delivery: The court addressed whether contract holders could withhold rent if they had not received the ECRs, even if the certificates were otherwise satisfactory. The court confirmed that contract holders could indeed withhold rent in such cases, deeming the rent “not lawfully due.”
The court emphasised that establishing that the electrical installations were safe at the material time was not enough. The regulations include a proactive obligation on landlords to serve ECRs on contract holders within specific timeframes. It was logical and fair for this obligation to be underpinned by the sanction of withholding rent to secure compliance as it was unrealistic to expect contract holders to be able or inclined to enforce this obligation by going to the expense of bringing legal proceedings.
- Retrospective Rent Liability Upon Late Service of ECRs: The landlords argued that rent should become due retrospectively if the ECR was eventually provided. However, the court rejected this position, ruling that rent remains “not lawfully due” from the time the ECR should have been served until it is actually delivered. The statutory framework, the court held, links compliance directly with landlords’ rights to receive rent, incentivising adherence to regulatory timelines for contract holder notification.
Whether contract holders can reclaim rent already paid arguing mistake or otherwise was not argued before the court and so such matters will fall to be considered if and when such a claim for repayment of rent is made.
- Common Areas Coverage in ECRs: The court did not rule on this issue as it was not relevant to the facts of the particular cases before the court.
- Determining the “Occupation Date” for Converted Contracts: In relation to converted contracts, the court clarified that the “occupation date” for purposes of Regulation 6(5) is either the date the regulations took effect 1 December 2022 or the original start date of occupation, whichever is later. For new tenancies commencing after 1 December 2022, the occupation date corresponds to the first day of occupation.
- Compatibility with Article 1, Protocol 1, ECHR: The final issue was whether the landlords’ potential losses of rent due to non-compliance with ECR requirements constitutes a violation of property rights under Article 1 of Protocol 1 of the European Convention on Human Rights. The court found that this issue was not engaged by the facts and so declined to make a decision based on a hypothetical situation. A contract holder will need to bring a claim for return of rent before a landlord can properly argue this point.
Significance of the Judgment
This judgment provides crucial clarity on the operational link between tenant rights and landlord compliance under the Renting Homes (Wales) Act 2016, firmly establishing that a landlord’s entitlement to rent is conditional on adherence to statutory safety-reporting requirements. By interpreting “not required to pay rent” as an enforceable tenant right independent of retrospective compliance, the court underscored a strict liability approach to tenant communication obligations.
For landlords, this decision signals that failure to deliver required ECRs may result in significant financial liability, irrespective of the actual safety condition of the dwelling. The judgment sets a clear precedent, reinforcing that statutory compliance under the Act includes procedural obligations to inform tenants, with potential broader implications for property law where similar consumer protection provisions exist.
Renting Homes Wales 