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Our thoughts on the latest developments in our specialist sectors and services.

COVID-19: Tenant protections extended

10 June 2020

The Government has announced that the ban on tenant evictions will be extended by two months until 23 August 2020.

In order to ensure there’s no gap between the existing ban and the extension, the two month extension will come into force on 25 June 2020.

The protections will apply for home owners as well as to tenants under commercial and leasehold properties. The changes are to apply in England and Wales. The extension takes the moratorium on evictions to a total of five months.

Notwithstanding the extension, the Government still only wants to see cases end up in court as a last resort. Landlords are being encouraged to work collaboratively with tenants and exhaust all other possible options when tenants are facing financial difficulties.

Whilst the extension will be positive news for tenants, it may not be so welcome for landlords. It has been introduced against a wider backdrop of other temporary limits imposed on landlords’ remedies, see our earlier article on this here.

While these limits are short-term measures – the temporary restrictions around presenting winding up petitions and issuing statutory demands are set to expire at the end of June 2020 (although those measures could be extended further) and the ban on tenant evictions at the end of August 2020 – it will not be a return to things as they were as the Government is currently pushing a bill through Parliament to make permanent changes to the Insolvency Act.

These changes will provide new protections for tenants such as a new moratorium procedure and a prohibition against landlords terminating certain types of contracts on the basis of the entry into insolvency procedures, which could include leases (we await parliamentary clarification on this point), all of which will limit landlord’s abilities to take action against their tenants.

Present circumstances mean that this is a rapidly changing area of law. We shall continue to monitor any developments.

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