On 1 December 2017, a number of important legislative provisions are being brought into force for those involved in the private residential rental sector.
The end of assured tenancies
The current system of assured and short assured tenancies is being replaced with the private residential tenancy.
The end of the sheriff court’s jurisdiction
As well as the end of the assured tenancy (which has been widely commented upon) there are also major procedural reforms taking place. From 1 December 2017, it will no longer be possible to raise an action in the Sheriff Court in respect of most residential tenancies.
Such disputes must now be referred to the First-tier Tribunal for Scotland (Housing and Property Chamber), a tribunal comprised of both legal and ordinary members who have an expertise in housing law.
The overriding objective of the Tribunal is “to deal with proceedings justly” which includes dealing with proceedings in a manner which is proportionate to the complexity of the issues, the resources available to the parties and ensuring so far as practicable that the parties are on an equal footing procedurally, avoiding delay and using the specialist expertise of the Tribunal.
Perhaps the most important change brought about by the transfer to the Tribunal is the recoverability of expenses. It will only be possible to recover expenses in the event one party has, during the conduct of the case, behaved unreasonably. This unreasonable behaviour must also have put the other party to unnecessary or unreasonable expense.
It remains to be seen what level of conduct will be required before the Tribunal will make such a finding. Notably, the conduct must occur in the course of the case, which suggests that conduct prior to the raising of an action is irrelevant in determining whether an award of expenses should be made. A finding of unreasonable behaviour also does not open the floodgates to an expenses claim for the entire conduct of the application- any expenses awarded in the Tribunal must be the amount required to cover any unnecessary or unreasonable expense incurred by the party in whose favour the order for expenses is made.
It remains to be seen how the Tribunal functions in practice. It is clear from the legislation that the Tribunal is being afforded broad discretionary powers. The development of an established body of Tribunal decisions will provide some insight, but in the early days of the Tribunal the outcome of cases may be difficult to predict. The new provisions for expenses in the Tribunal (or lack thereof) will also impact on the viability of raising proceedings.