On 1 December 2017 the Private Housing (Tenancies) (Scotland) Act 2016 came into force. This Act introduced a new Private Residential Tenancy (PRT). This means that all new tenancies of residential property must, from 1 December 2017, be a PRT.
The PRT replaces Assured Tenancies (ATs) and Short Assured Tenancies (SATs). However, ATs or SATs entered into before 1 December 2017 will continue until the Managing Trustees or the tenant serves a notice to quit the let property.
One important difference of the new PRT is that the tenancy has no end date, therefore it will last until a tenant wishes to leave the let property or a landlord uses one (or more) of 18 grounds for eviction.
What needs to be done before the tenant takes occupation of the let property?
The Scottish Government has produced a Model Tenancy Agreement (MTA) which can be downloaded and used free of charge from: https://beta.gov.scot/publications/scottish-government-model-private-residential-tenancy-agreement/pages/3/.
The clauses in the MTA in bold text are mandatory and have to appear in the tenancy agreement. The clauses in normal text are discretionary and can be included if the Managing Trustees wish. If the Managing Trustees or their agents are utilising the MTA TMCP have standard wording to correctly describe how the Landlord should be defined at Clause 3.
At Clause 37 of the MTA there is an “additional terms” section which allows the parties to include their own terms. This is where the “Methodist Template Clauses” should be inserted. The Methodist Template Clauses which need to be added at Clause 37 of the MTA will soon be available on TMCP’s website. In the meantime Managing Trustees can contact TMCP Legal to ask for a copy.
Before entering into a PRT, the Managing Trustees or their agent must provide the tenant with a copy of the MTA (if this is being utilised) and the accompanying Easy Read Notes. The Easy Read Notes are also published by the Scottish Government and can be found here: https://beta.gov.scot/publications/easy-read-notes-scottish-government-model-private-residential-tenancy-agreement/. The Easy Read Notes explain in plain language all the standard terms of the tenancy agreement.
If the MTA is not being utilised the Managing Trustees, or their agents, must ensure that the tenancy agreement contains the nine statutory clauses which need to be included under the legislation. If the MTA is not being used then as Landlord the Managing Trustees, or their agents, must provide the tenant with the Private Residential Tenancy Statutory Supporting Notes which can be found here: https://beta.gov.scot/publications/private-residential-tenancy-statutory-terms-supporting-notes-essential-housing-information/ in place of the Easy Read Notes.
How to end the tenancy
As the tenancy has no end date the Managing Trustees cannot obtain occupation without showing that one or more of the 18 statutory grounds for eviction apply.
The Managing Trustees have to serve on the tenant a statutory prescribed Notice to Leave which will state the statutory ground(s) for eviction. If the tenant agrees to leave then once they have ceased to occupy the property, following receipt of the notice, the tenancy will have ended.
If the tenant refuses to leave then the Managing Trustees will have to apply to the First-tier Tribunal for an order to evict. The Scottish Government have provided guidance on the process in their guidance note “Private Residential Tenancy: Guide for Landlords" (https://beta.gov.scot/publications/private-residential-tenancies-landlords-guide/). Managing Trustees would also need to follow the requirements under Standing Orders. In summary, the Managing Trustees would need to pass a resolution locally and obtain legal advice on the merits, risks and costs of taking such action and the consent of the Connexional Team under Standing Order 931(5). If Managing Trustees need to take this step please contact TMCP Legal so that we can provide detailed guidance and assist Managing Trustees in applying for the necessary consent.
Managing Trustees may need possession of property either to house a Minister or they may take the decision to sell a property which is let.
Under the legislation one of the grounds for possession is that the let property is required for a religious worker. This is a mandatory ground. Therefore if the Managing Trustees can show evidence of this then the First-tier Tribunal has to issue an order for eviction. However, to satisfy this ground the property must have been used previously to house a Minister.
Another mandatory ground for possession is if the Managing Trustees wish to sell the property. To satisfy this ground, the property in question has to be put on the market within 3 months of the tenant moving out. Managing Trustees wanting to use this ground would need to ensure that they could provide evidence in the form of a solicitor’s/estate agent’s letter.
TMCP’S Guidance for Scottish Property Transactions
In the coming weeks TMCP’s website will host a page which deals exclusively with property transactions in Scotland. The “Residential Tenancies” section will contain guidance on granting a residential tenancy in Scotland, as well as the template clauses which need to be incorporated into the Model Tenancy Agreement.
Guidance on selling property in Scotland will also be available shortly and we will also be adding guidance on purchasing property, and granting a non-residential lease in due course. In the meantime if you have any queries on property transactions in Scotland then do not hesitate to contact us directly.
If you have any queries in relation to the guidance in this document please contact TMCP Legal for further assistance.