Landlords in England and Wales face significant challenges when tenants fail to pay rent. The law offers several avenues for landlords to recover rent arrears, ensuring they can uphold their financial obligations. ARC Costs aims to answer the question “can a a landlord can sue for unpaid rent?”

Can a landlord sue for unpaid rent?

Landlords have the right to sue tenants for unpaid rent under common law and specific statutes, including the Housing Act 1988 and the Landlord and Tenant Act 1985. These laws establish the rights and responsibilities of both landlords and tenants, providing a structured process for handling rent arrears in an assured shorthold tenancy.

Before pursuing legal action, landlords are encouraged to take several preliminary steps:

Communication:

Landlords should contact the tenant to discuss the issue and attempt to reach an amicable resolution.

Formal Notice:

They should then serve a formal notice, such as a Section 8 or Section 21 notice, depending on the tenancy agreement and the nature of the breach.

Mediation:

They may also wish to engage in mediation services to negotiate a payment plan or other resolutions without resorting to court action.

Section 8 and Section 21 Notices

The type of notice served depends on the tenancy agreement and the landlord’s objective:

Section 8 Notice:

These are used when the tenant has breached the tenancy agreement, such as failing to pay rent. It requires specifying the grounds for possession under Schedule 2 of the Housing Act 1988. Ground 8, for instance, mandates possession if the tenant is in at least two months’ arrears.

Section 21 Notice:

A Section 21 Notice is a ‘no-fault’ notice that allows landlords to regain possession of their property at the end of a fixed-term tenancy or during a periodic tenancy, provided they give the required notice period.

Court action

If informal measures fail, landlords can pursue legal action through the courts. If the amount of rent owed falls below a certain threshold, landlords will be required to proceed through the Small Claims Court.

Alternatively, claims above a certain threshold will proceed through the higher courts, such as the County Court. The process typically involves:

Filing a claim:

The landlord files a claim in the County Court for the unpaid rent and, if applicable, for possession of the property.

Court hearing:

Both parties present their case. The court examines evidence, such as the tenancy agreement, payment records, and communications between the landlord and tenant.

Judgment:

The court may issue a judgment in favour of the landlord, ordering the tenant to pay the outstanding rent and potentially granting possession of the property.

County Court Judgement CCJ

When a landlord wins a court case for unpaid rent, the court can issue a County Court Judgment (CCJ) against the tenant. A CCJ is a court order that declares the tenant owes a specific amount of money to the landlord. This can have serious implications for the tenant, including:

Credit Impact:

A CCJ negatively affects the tenant’s credit rating, making it more difficult to obtain credit in the future.

Enforcement:

If the tenant does not comply with the CCJ, the landlord can take further enforcement actions, such as hiring bailiffs to seize property or garnishing the tenant’s wages.

Enforcement of Judgment

If the court rules in favour of the landlord but the tenant still does not pay, further steps may be necessary to enforce the judgment:

• Attachment of Earnings: Deductions from the tenant’s salary.
• Bailiff Action: Seizing the tenant’s goods to cover the debt.
• Charging Order: Securing the debt against the tenant’s property.

Alternative Dispute Resolution

To avoid lengthy and costly court proceedings, landlords and tenants can opt for Alternative Dispute Resolution (ADR) methods like arbitration or negotiation. ADR can be quicker and less adversarial, helping both parties reach a mutually acceptable solution.

Both landlords and tenants should seek legal advice from a solicitor when facing these types of disputes.

How can ARC Costs Assist?

ARC Costs can assist will all aspects of costs concerning the claiming or defending of tenancy dispute costs.

ARC Costs are a team of independent and experienced Costs Draftsmen and Costs Lawyers. We regularly assist Paying and Receiving parties in the recovery/contention of costs.

At ARC Costs, we also maintain an extensive legal network of expert Solicitors in the legal field of tenancy disputes. If you intend to pursue or defend a case, we would be happy to pass on your query to one of the Solicitors on our panel.

We may receive payments from third party solicitors on our panel (for non-FCA regulated work) to whom we may refer your claim. We will never charge you for any referrals made to our panel of third parties.

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