Disrepair claims: a losing battle for landlords?

I recently attended a seminar aimed at RPs defending disrepair claims. The shocking truth that emerged was that housing providers are suffering the same fate across the UK: regular large pay outs of compensation, particularly claimant legal costs, writes Rebecca Aspin, Solicitor at Croftons.

There does not seem to be any general consensus on how to defend these claims, but can we prevent them instead? The answer, to a large degree, is yes. So what are the biggest pit falls for landlords that make disrepair claims more likely, and harder to defend if you end up in court?

1. Getting tenancy agreements right

As many of you will know, the main statutory provision that claimant solicitors rely upon are implied into tenancy agreements by Section 11 of the Landlord and Tenant Act 1985. The provision is as follows:

(1) In a lease to which this section applies (as to which, see sections 13 and 14) there is implied a covenant by the lessor—
a. to keep in repair the structure and exterior of the dwelling-house (including drains, gutters and external pipes),
b. to keep in repair and proper working order the installations in the dwelling-house for the supply of water, gas and electricity and for sanitation (including basins, sinks, baths and sanitary conveniences, but not other fixtures, fittings and appliances for making use of the supply of water, gas or electricity), and
c. to keep in repair and proper working order the installations in the dwelling-house for space heating and heating water.

The one consolation for Landlords when dealing with liability under Section 11 is that they must have been placed on notice of a repair before they can be held liable for a failure to remedy such a repair. However, the biggest and most prominent issue we have found with our clients is that their tenancy agreements bind the landlord above and beyond the remit of Section 11.

The variances within tenancy agreements can be extremely minor, for example:

To keep in “good” repair the structure and exterior…

By adding the word “good” in to the wording of the tenancy agreement the landlord has bound themselves to maintaining a subjective standard of repair. Not only does the landlord have a duty to repair issues that have become “broken” but they have to repair issues that may not necessarily be broken but in fact, not held to be at the subjective standard of “good” repair.

By changing the wording from the objective “repair” to the subjective “good repair” the clarity of any defence is lost. What do we class as good repair? This decision would be down to a judge in a court room, subsequently litigating with a high risk that either party could lose their arguments.
On a commercial point, it would not be in the best interests of our clients for us to advise them to take a matter such as this to court. If the case was lost the landlord could be facing the pay out of not only compensation but a hefty costs bill as well, which could be anywhere between £20,000 – £50,000, and potentially more.

How to solve this issue?

Check your tenancy agreements and get them changed. Easier said than done of course, as full consultation with tenants would be required, but this is definitely something to look into and the only sure-fire way of resolving this issue.

2. Unsatisfactory evidence

We hear it so often:
“But the tenant denied us access on that appointment”
“The tenant said she was happy with the repairs”
“We did attend the property and fix that particular damp issue”

But where is the evidence? Landlord recording systems are, more often than not, substandard or not utilised effectively. Without the evidence to back up these claims it is almost impossible for a case to be successfully defended.

How to solve this issue?

Records, training, and more records!

Various departments across housing organisations have regular contact with tenants on a daily basis, and it is absolutely crucial that all contact with each tenant is recorded in detail. This can also be used to the landlord’s advantage at initialising the process of preventing disrepair claims.

For example, it would be extremely simple to add on to the end of each call:
“For our records, do you have any outstanding repairs at the property you wish to report today?”

If this is logged and dealt with in the appropriate manner you may have just prevented that tenant following through with legal action after being tempted by a leaflet they have received through their door from a ‘claim farmer’.

In addition, it is extremely important that detailed records of repairs are taken. This could differentiate between a patch of damp that was repaired on the living room gable wall three years ago, and the patch of damp that has been claimed as disrepair next to the bay window at the front of the house.

It is important to provide cross-departmental training on the issues of disrepair and the negative impact it has on the landlord organisation.

3. Policies and procedures that are fit for purpose

Many of our clients have policies and procedures that we find are insufficient to deal with the strain of disrepair claims. For example, many of our clients operate on the basis that if a contractor has one failed access attempt to the property to carry out works they simply leave a calling card and the onus is on the tenant to rearrange. This is insufficient in a legal sense, as it does not relieve the landlord of their duty to repair.

Equally, some of our clients have policies which reward tenants with ‘good’ behaviour a better standard of repair than that dictated by Section 11. Again, this is binding the landlord over and above statutory requirements and should be re-evaluated in terms of risks. Being a ‘good’ tenant does not prevent them from suing their landlord.

How to solve this issue?

Evaluate service needs and adapt policies and procedures to match.

Start the fight back
With the increase in unscrupulous claim farming and the operational issues we’ve highlighted, we can only see disrepair claims continuing to increase, posing a significant financial and reputational risk to landlords.

The points above are just the tip of the iceberg in terms of what landlords can do to start fighting back on disrepair claims. These claims will not be disappearing any time in the near future and landlords need to adopt these and other practices to tackle the problem.

We are currently working alongside a large number of housing clients to develop staff training, tighten up policies and procedures, redraft tenancy agreements and implement the best resources to prevent these claims, or make them easier to defend.

If you would like further help or advice on this key issue please contact our housing management team: www.croftons.co.uk/housing-management