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The Residential Tenancies and Valuation Act 2020: New protections for tenants amid pandemic

Paddy Smyth
21/08/2020

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Ireland

As part of the Irish Government’s ongoing response to the Covid-19 pandemic, further measures have been introduced to protect residential tenants, particularly those now vulnerable as a result of a change to their employment circumstances due to the pandemic.

The Residential Tenancies and Valuation Act 2020 (the "2020 Act”) became law on the 1st of August 2020. The Act seeks to recognise the impact that the rise in unemployment and reduced working hours has had on the rental sector, and the challenges that this presents for tenants in meeting their obligation to pay rent.

The Act replaces the emergency measures included in the Public Interest (Covid-19) Act 2020 (the "Emergency Measures Act”). The Emergency Measures Act banned all rent increases and evictions during the Covid-19 emergency period, up to the 1st of August 2020. The new 2020 Act protections for tenants will remain in place up until 10 January 2021. The 2020 Act also applies equally to licensors and licensees.

Who is protected?

Instead of sweeping measures akin to those introduced by the Emergency Measures Act, this Act is addressed specifically towards those tenants most at risk.

Relevant persons’ have been designated as those who will now receive additional protections under the 2020 Act. These persons will be able to remain in their tenancy without any increase in rent until 11th January 2021.

The 2020 Act defines a ‘relevant person’ as one who is unable to comply with their obligation to pay rent in respect of their tenancy by reason of financial hardships imposed on them as a result of the pandemic. Some of these circumstances may include where a tenant is in receipt or is eligible to receive the temporary wage subsidy or another social welfare payment for loss of earnings due to Covid 19. It will also include those who cannot work due to a Covid-19 diagnosis or a requirement to self- isolate.

Self-Declaration Form

Section 4 of the Act provides that a tenant seeking protection under the 2020 Act will be required to serve a declaration asserting in writing that they:

1.     Are a relevant person; and

2.     As a consequence, the tenant believes that there is a significant risk that their tenancy will be terminated by the landlord.

The original notice must be served on the RTB (“the Residential Tenancies Board”) and a true copy of the declaration must be served on the landlord. The RTB has a sample Self Declaration form available here

A tenant who falsely makes such a declaration shall be guilty of a criminal offence.

Notices of Termination

Ending a tenancy for reasons other than rent arrears is now permitted, as per the rules as set out in the Residential Tenancies Act 2004, as amended.

Notices of termination served before the emergency period will now recommence. Where a notice of termination was served before the commencement of the emergency period (27 March 2020), the countdown to the termination date will run again from 2 August 2020, and a tenancy cannot end before 10 August 2020 at the earliest. The revised termination date will be based on unexpired notice that remained when the emergency period began.

Notices of Termination – Rent Arrears

The 2020 Act provides that tenants facing hardship as “relevant persons” due to the pandemic will be protected from eviction if they cannot pay their rent. If a tenant has provided their landlord with the requisite Self Declaration Form their tenancy cannot be terminated until on or after 11th January 2021, and the tenant must then be provided with a minimum of 90 day’s notice.

Termination for rent arrears is allowed where tenant is not a relevant person but new procedures apply.

The new Act has also made changes to all terminations for rent arrears, not just those of "relevant persons". In all cases, 28 days written notice must be provided to the tenant, before a notice of termination can be served. Up to now the warning period has been 14 days so this marks an increase of 14 days.

This notice must specify the amount of rent outstanding and confirm that failure to pay will result in a notice of termination. Landlords must provide a copy of the rent arrears warning notice to the RTB.  At this stage the RTB will write to the tenant providing information on income supports and advice on the Self Declaration Form. The RTB will also seek consent from the tenant to permit the RTB to contact the Money Advice and Budgeting Service in relation to the arrears.

Once the 28 day warning has expired, if the tenant has not issued a Self-Declaration Form, the landlord may then serve the notice of termination, which provides a further final 28 days before the tenant must vacate the dwelling. A copy of the notice of termination must also be served on the RTB on the same day as it is served on the tenant. If the landlord does not send the copy of the notice of termination to both the tenant and the RTB, the notice of termination will be invalid.

Rent Increases

Section 6 of the 2020 Act provides that any rent increases that came into effect before 27 March 2020 is now payable, unless the tenant is a relevant person. Otherwise, Section 6 of the 2020 Act expressly provides that increases in rent shall not take effect and shall not be payable during the emergency period. There is in our view ambiguity in the RTB's guidance on this point which we believe requires clarification.

Commercial Tenancies

As noted in our previous update on the Emergency Measures Act, it provided for some ambiguity at section 5(7)(a) which proposed a ban on “all proposed evictions in all tenancies in the State”. This was widely interpreted as also referring to commercial tenancies.

This section has now been deleted in the new Act, removing the possibility of extending the provisions to commercial tenants.  

Conclusion

Although these restrictions are limited in time, they will have a significant effect on tenants and landlords for their duration and will provide some comfort to those facing the uncertainty of being unable to meet their rental obligations as a result of the pandemic.

The changes to the termination procedure for rent arrears will remain beyond the emergency period. The additional requirements makes termination for rent arears a somewhat more onerous prospect for landlords but provides a further opportunity for engagement between the tenant and landlord before an eviction takes place. There is also now a focus on providing support and information to a tenant in arrears, so that termination is a last resort.

A copy of the Act can be found here.

Written by Paddy Smyth and Aideen Farrelly

A phased return to work is taking place in different sectors.  Fieldfisher is committed to supporting you through the transition and beyond.  We continue to be available to our clients either remotely or in person, with your business as usual matters, as well as for C-19 support.    Please review our Covid-19 hub for updates and get in touch if you require further information.
 

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