Sometime mid-afternoon on Friday 3rd April, Tessa contacted me suggesting putting together a webinar on how the current measures to control the spread of
Coronavirus/COVID-19 might affect landlords and tenants. With some incredible work by Tessa and her team, we were able to conduct the first webinar under a week later.
Tessa very generously agreed to donate her profits to charity and raised over £1,100 for the British Red Cross.
One of the things that I enjoyed about the webinar was the range of interesting comments and questions. We are doing another webinar on Thursday 16th April, and I look forward to many more comments and questions, but one question that came up several times during the webinar was about Energy Performance Certificates (EPCs) and when landlords need to provide them for new tenancies.
So we thought it might be helpful to have a post about this.
Note that this post is written in the light of the specific circumstances of the coronavirus lockdown in 2020.
The EPC Regulations
The requirement to provide an EPC comes from the Energy Performance of Buildings (England and Wales) Regulations 2012 (SI 2012/3118), which were made
under the Energy Act 2011 (and the European Communities Act 1972). These Regulations came into force on 9 January 2013 (there were earlier Regulations in
2007).
The key requirements are in reg.6 and reg.7.
Regulation 6
Regulation 6 applies when a building (which includes a “building unit”, meaning “a section, floor or apartment within a building which is designed or altered to be used separately”) is to be rented out (or when it is to be sold) and contains two duties.
The first duty is that the relevant person (in relation to a building which is to be rented out, this is the prospective landlord) must make available, without charge, a valid EPC to any prospective tenant: reg.6(2). This must be complied with:
(a) at the earliest opportunity; and
(b) in any event no later than whichever is the earlier of—(i) in the case of a person who requests information about the building, the time at which the relevant person first makes available any information in
writing about the building to the person; or
(ii) in the case of a person who makes a request to view the building, the time at which the person views the building.
That first duty does not apply if the prospective landlord believes on reasonable grounds that the prospective tenant is unlikely to have sufficient means to rent the building, is not genuinely interested in renting a building of that general description, or is not a person that they would be prepared to rent it to: reg.6(3).
Regulation 3 contains the definition of prospective tenant:
A person becomes a prospective buyer or tenant in relation to a building when he or she—
(a) requests any information about the building from the relevant person or the relevant person's agent for the purpose of deciding whether to buy or rent the building;
(b) makes a request to view the building for the purpose of deciding whether to buy or rent the building; or
(c) makes an offer, whether oral or written, to buy or rent the building.
The second duty under reg.6 is to ensure that a valid EPC has been given, without charge, to the person who ultimately becomes the tenant: reg.6(5).
Now, that should have already been done under the reg.6(2) duty, but it is possible that someone might have slipped through the net, or might have come under the reg.6(3) exemption, or even that the EPC was not yet ready at that time.
This duty is very important as it is a “prescribed legal requirement”, which means that it may not be possible to give a s.21 notice if the landlord is in breach of it. More on this below.
Note that, at either stage, the EPC can be given electronically if the recipient consents: reg.13. That seems a very sensible option in the current circumstances.
Various types of buildings are exempted from these requirements by reg.5, including some (but not necessarily all) listed buildings, residential buildings which are used or intended to be used for less than four months of the year.
Regulation 8 also creates an exemption for buildings that are to be demolished. It also seems probable that these requirements do not apply to HMOs where there are separate tenancies of individual rooms with access to shared facilities, as they would not be a “building unit”, but this needs authoritative determination from the courts (but see this report of a county court case).
Regulation 7
Regulation 7 applies where a building is to be rented out (or sold) and no valid EPC is available for that building.
The relevant person must secure that one is commissioned before the building is put on the market: reg.7(2). A person acting on behalf of the relevant person must be satisfied that an EPC has been commissioned before they market the building: reg.7(3). This covers letting agents.
The relevant person and a person acting on their behalf (e.g. a lettings agent) must use all reasonable efforts to secure that a valid EPC is obtained for the building
within a period of 7 days from when the building is put on the market: reg.7(4).
Where this has not been possible, a further 21 days is allowed by reg.7(5), but the EPC must be obtained within that further 21-day period. This is subject to the same exemptions for types of buildings.
Housing Act 1988 requirements
At this point, it is important to remember that Housing Act 1988, section 21A means that a valid section 21 notice cannot be given in relation to an assured shorthold tenancy at a time when the landlord is in breach of a prescribed legal requirement.
The prescribed legal requirements are set out in Assured Shorthold Tenancy Notices and Prescribed Requirements (England) Regulations 2015 (SI 2015/1646).
They apply in relation to an assured shorthold tenancy of a dwelling-house in England granted on or after 1 October 2015 (but do not apply to a tenancy that comes into being on or after 1 October 2015 as a result of Housing Act 1988, s.5, if the prior tenancy was granted before that date).
Regulation 2(1) sets out that one of the prescribed requirements is that contained in reg.6(5) of the Energy Performance of Buildings (England and Wales) Regulations 2012. There is some doubt over whether the EPC can be given after the tenancy has commenced (landlords will be familiar with the arguments about gas safety certificates). In one county court appeal, it was held that the EPC can be given after the tenancy has begun (Curd v McCausland, County Court at Leicester, July 2018).
There are, however, arguments the other way and so landlords should always aim to give the EPC before the tenancy begins.
Government guidance on EPCs
The Ministry of Housing, Communities & Local Government has published guidance as Energy Performance Certificates (EPCs) requirements when selling or letting a property. This points out that the “legal requirement to obtain an EPC before selling or letting a property remains in place”. The guidance continues to say that
Where a property is occupied, parties must endeavour to agree that the transaction can be delayed, so that an EPC assessment can proceed when stay-at-home measures to fight coronavirus (COVID-19) are no longer in place.
If moving is unavoidable and the parties are unable to reach an agreement to delay, and a valid EPC is not available from the register, an assessment may need to be conducted. In these circumstances, government guidelines on staying away from others to minimise the spread of the virus must be followed alongside the guidance for carrying out work in people’s homes.
EPC assessments can continue in cases where your property is vacant.
Landlords should also see further information on coronavirus (COVID-19) and the enforcement of standards in rented properties.
No assessments should take place if any person in the property is showing symptoms, self-isolating or being shielded – if securing an EPC is critical you should seek to reschedule your appointment when it is safe to do so in accordance with Government guidelines on staying away from others.
Propertymark guidance
There is some guidance from Warwickshire County Council Trading Standards Service, in partnership with The Property Ombudsman and Propertymark. It can be accessed on the Propertymark website here. They say as follows.
1) – Regulation 6(2) of the EPB requires an EPC to be made available to a prospective tenant at the earliest opportunity, and in any event no later than
the earlier of either when the ‘relevant person’ makes written information about the property available, or when a person asks to view the property.
An existing tenant is not a prospective tenant, so under the EPB there would be no need to make an EPC available. However, see below.2) – Assuming ‘renew a tenancy’ relates to an existing tenant staying in the same place under the same agreement, not a new tenant moving in, then we would suggest that it would not be a misleading omission, unless the rating would be different from the original rating when the tenant first moved in.
A landlord or agent should consider whether the EPC rating has changed since the original certificate was produced, for example due to a new boiler
being fitted. There may be a misleading omission under the CPRs if this change in the rating was ‘material information’, which that tenant would need
to make a decision to stay in the property or leave it.If the rating has not changed and the tenant is in possession of the old, expired EPC, and nothing has changed to render the information contained
therein inaccurate, then there will not be an omission.Of course, if the existing tenant is joined by another person at renewal (new spouse for example), the other person would be considered a new tenant and thus would require a current valid EPC to be made available to them.
New tenancies
So what does all of this mean for new tenancies? We can think about the various ways that these may come up.
First, a brand new tenancy to a new tenant.
If there is already a valid EPC, then it needs to be given to the new tenant, preferably before the tenancy begins.
If there is no valid EPC, then it depends on whether or not the property is currently occupied.
- If the property is unoccupied, it will probably be possible to secure a valid EPC within the 28 days allowed for by reg.7.
- If the property is currently occupied, this may not be possible.
In either case, some careful thought should be given as to whether now is the appropriate time to start marketing a property. If it is occupied then this may simply be impossible (and think also about how viewings will be carried out).
In all these situations though, landlords and agents should, however, bear in mind the practical difficulties in new tenancies and house moves in the present circumstances.
Secondly, a new tenancy to an existing tenant.
In these situations, an EPC should have already been given in relation to the earlier tenancy. On a natural reading of the 2012 Regulations, it does not seem that the duties need to be complied with again.
As the Propertymark guidance suggests, it seems strange to talk about the parties as a prospective landlord and prospective tenant – they are already landlord and tenant. Even if reg.6(5) did arise again, there seems no reason why it could not be said to have been satisfied by the earlier provision of the EPC.
That said, any element of doubt can be avoided by sending a further copy of the EPC (by email, if the tenant has agreed to that).
It should be said that this is a developing and technical area of law, and that guidance and regulations in relation to Coronavirus/COVID-19 are all changing at a
rapid pace. Landlords and agents should take advice on their specific situation before acting on anything set out in this post.
Sheralyne Stamp says
How can we get these done during lockdown? My regular assessors and closed.as are others.
We want to market the property to get interest for when lockdown is lifted,
william Charles Adams says
My tenant is on periodic tenancy and has been for more than 1 year. The renewal of EPC was due during lock down. She was provided with an EPC at the beginning of her tenancy however obviously this is now not in date. I have not been able to renew through lock down. I have emailed and texted but had no answer. Way do I do