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Possession Proceedings, Do The Rules Help Everyone?

In April 2009, the Civil Procedure Rules in respect of possession proceedings (Part 55) were amended to extend the length of notice a tenant or home owner was given as notification that such proceedings had been commenced.

This rule was amended to allow tenants, including those of mortgaged properties, the opportunity of speaking to landlords and mortgage lenders to try and rectify the issues that had led to possession proceeding being issued", says Sarah Doble of Battens' Property Litigation Team. "It is a clear indication that the Courts' are facing large possession lists and its time was being wasted as more often than not cases were being adjourned because the tenant or home owner were saying that they had not received notice, or they had not had time to speak with their landlord or mortgage lender"

Sarah goes on to say, "clearly, Parliament intends to slow down the number of houses being repossessed in the recession, by giving the tenant or home owner longer notice so there is enough time to reach an agreement to avoid repossession"

The new rules are to help tenants, "it puts the pressure on the landlord or mortgagee and/or their legal representative to make sure that all time limits are followed, there is no room for mistake. Failure to notify the tenant or mortgagor could result in a claim for possession being delayed or even refused.

"It is another cost to weigh on landlords who are already bearing all the costs in a market where housing associations are struggling to re-house those who are subject to possession orders." Sarah states.

However, was it enough?

Clearly not because on 1 October 2009, the Civil Procedure Rules are again being updated in respect of Part 55.

The rules introduce a pre-action checklist for all Mortgage Lenders to complete before taking possession proceedings. This sets out what steps must be taken before proceedings are commenced, including a checklist which must be completed and filed with proceedings in Court.

"This has resulted in commencement of mortgage possession proceedings being delayed until borrowers are more than 3 months in arrears," says Sarah.

In a further bid to alleviate any backlog with housing, Parliament has passed this further amendment to Part 55, whereby mortgagees are obliged to inform the local housing authority when possession proceedings are to be commenced. "Presumably this strategy is to make sure that once a possession order is obtained, there can be no delay in re-housing the tenant or mortgagor in housing association accommodation, a trait that we have seen on the increase over the last few years", says Sarah

Therefore, the new rules appear to be in the favour of the tenant and failure to comply could prove costly for any mortgagee or residential landlord.

Further protection for the tenant could be just around the corner following the Consultation on lender repossession of residential property: protection of tenants, the consultation of which is due to expire on 14 October 2009 and could lead to further amendments of Part 55.

Created: 06 October 2009