In a case that is of perhaps of more historical interest in that it relates to the renunciation of assured and short-assured tenancies under the Housing (Scotland) Act 1988 (the 1988 Act), the Upper Tribunal looked at the situation where it was alleged that the landlord had, with a view to evicting the tenant, persuaded a tenant to sign a new lease with less security of tenure in a practice called ‘winkling’. The case before the Upper Tribunal, can be found here:
https://www.scotcourts.gov.uk/docs/default-source/cos-general-docs/upper-tribunal-pdfs-for-web/2023ut25.pdf?sfvrsn=3739d172_1
It is perhaps of more historical interest because, whilst renunciation is a valid route to end an assured or short-assured tenancy, the same cannot be said about Private Residential Tenancies for reasons that will be addressed in this article.
What was the case about?
The tenant in this case had been an assured tenant from 1993. After inheriting the property from a family member, the landlord served a Form AT5 (the prescribed document that was part of the requirements to create a short-assured tenancy) and a new written lease was entered into, on 1 October 2006 which purported to be a short-assured tenancy rather than an assured tenancy. In October 2022 the landlord applied to the First-tier Tribunal seeking an order for possession under section 33 of the 1988 Act on the basis the short-assured tenancy had come to an end and the landlord wanted possession of the property. The First-tier tribunal granted the order and the tenant appealed to the Upper Tribunal.
How was the original assured tenancy ended?
The First-tier Tribunal found that by signing the new short-assured tenancy, the tenant had agreed to “renounce” his original contractual assured tenancy. Interestingly, the tenant argued that he had only done so to “trick” the landlord as he believed it was “ineffective in law to create a short-assured tenancy”. He tried to argue that, whilst he may have terminated his contractual tenancy in 2006, that did not have the effect of allowing the creation of a new short-assured tenancy as to hold otherwise would “allow parties to contract out of the statutory protections for tenants in the 1988 Act”. The Upper Tribunal did not agree with this analysis and, in refusing the appeal, found that by signing the new lease, the effect was to renounce the existing assured tenancy and, as all the requirements for the creation of a short-assured tenancy had been met, that assured tenancy had been replaced by a new short-assured tenancy.
What about Private Residential Tenancies (PRTs)?
The same will not apply to PRTs. In short PRTs can only be brought to an end in accordance with the terms of the Private Housing (Tenancies)(Scotland) Act 2016 (2016 Act). The 2016 Act includes a provision that a PRT cannot be brought to an end by the landlord or tenant “nor by any agreement between them” (section 44). That being the case, as stated by the Upper Tribunal, “there is no scope under the 2016 Act for parties being taken to have agreed to end a residential tenancy (as in the present case) by the mere fact of entering into a new lease.”
What are the implications for PRTs?
So, in order to end a PRT, you must follow the requirements of the 2016 Act. It also has a few interesting implications:
- A landlord cannot let one joint tenant out of a PRT by simply executing another ‘replacement’ PRT in the name of the remaining tenant
- This also applies to the issue of the rent that can be charged under a lease in the context of the current ‘rent cap’
Even where a tenant is sympathetic to a landlord who cannot afford to continue with a tenancy due to, for example, increased borrowing and/or other costs, and offers to pay a higher rent, parties cannot simply enter into a new PRT as, not only would that not bring the original PRT to an end (meaning the original terms continue to apply), but as the rent increase provisions under the 2016 Act had not been followed either, such an agreement could not be of any effect and an increased rent would not be payable.
Considering that the whole purpose of the ‘rent cap’ and the eviction moratorium under the Cost of Living (Tenant Protection)(Scotland) Act 2022 is to protect tenants, it is somewhat ironic that some tenants will face eviction from desperate landlords despite offering to, and being able to pay a higher rent.
