I normally steer away from advice articles for this blog, Shelter Legal pages are the best by far if you have a problem so why re-invent the wheel?
However with energy price hikes front and centre in the news there are some issues for tenants that probably aren’t covered elsewhere. Given Safer Renting only work with the worst of the worst landlords and agents we are seeing a growth in the problem that maybe isn’t being seen elsewhere that much…..Yet!
So this piece is written for any affected tenants or those who have to advise them.
It has long been common practice in HMOs for tenants to either pay their rent inclusive of bills or to have some kind of informal arrangement with the landlord to make a contribution towards the utilities.
This is because there is usually only one gas and electricity meter for the house, which is perfectly normal and reasonable. These days a landlord could install smart meters in individual rooms where each tenant is metered and billed, taking responsibility away from the landlord but they don’t, at least Safer Renting’s landlords don’t.
So arrangements for the payment of utilities is usually quite haphazard which causes innumerable problems, resulting in tedious hissy fits.
Bear in mind that such arrangements are not adequately covered by legislation, they are contractual matters, so how the contract or verbal agreement is structed dictates exactly what a landlord can do.
In written contracts it is common to see a clause saying simply “Rent inclusive of utilities”, so if you are paying £400 per month it is difficult to ascertain how much of that £400 is actually for bills.
I don’t think I have ever seen a contract with a clause built in for increases in utility bills and therein lies our first problem. If the contract is silent on this and the bills go up there is no contractual mechanism for the landlord to raise the £400, except in line with mechanisms for rent increases, which can only be done within prescribed timescales.
In other set-ups the tenant may pay their rent and a fixed sum of say £20 per week on top. In this scenario, if the arrangement is for a set periodic amount, then that is the contractual deal and the landlord isn’t automatically empowered to raise it without the agreement of the tenant just because the bills go up and this is the same whether this is in a written contract or just the informal arrangement that the tenants have been living with for the past year.
So what does this mean at a time when energy price hikes are set to go up by 100% or more?
Well if a tenant has an agreed deal on payments, the landlord cant impose an increase just because of higher bills. The landlord who is under a duty in such cases to maintain supply simply has to take the financial hit.
What this is doing down in the rogue landlord end of the market is landlords trying to impose higher payments on their tenants and in some cases refusing to charge up pre-payment meters. This is something we expect to see getting worse as the months go on, especially as predictions of the energy crisis seem to make the case that this will go on until at least 2023.
Some of our landlords are approaching their tenants and saying “You have to pay more”, to which we respond “No, No, No”
Whilst we are talking about difficult arrangements for utilities, perhaps the worst arrangement of all is where there are pre-payment gas cards and electricity keys that are left in the property for the housemates to come to payment arrangements between themselves to keep supplies connected.
In terms of property management this is always an absolute disaster area for two reasons
1) people consume different amounts of gas an electricity based on a number of factors, for instance some occupiers may be at home all day whilst others aren’t, causing an imbalance in the use of supplies and
2) when it comes to things like heat, people have widely differing tolerances to both hot and cold.
Landlords usually taking the view that the control of the utility bills is down to the tenants and not his responsibility if the utilities go down because the renters aren’t paying to keep them topped up.
At best landlords may attempt to deal with this problem by limiting the thermostat and even installing lock boxes to prevent housemates from tampering with the settings. Either way you get World War 3. It’s a recipe for disaster.
The Protection from Eviction Act 1977 should provide assistance in these disputes but the relevant part is poorly worded, so raises more questions than answers. S3 makes it an offence for a landlord to “Persistently withdraw or withhold services reasonably required for the occupation of the premises” but in the case of the occupiers topping up the gas card and electricity key, the case could be argued that the landlord isnt actually withholding the services but don’t they have a responsibility to maintain the supply?
Well we can also look at s11 (1) b; of the Landlord and Tenant Act 1985 which requires the landlord “to keep in repair and proper working order the installations in the dwelling-house for the supply of water, gas and electricity” but with what we are examining here any cessation of supply is not down to disrepair or a utility supply not being in working order.
There is a long unused and forgotten about facility under s33 Local Government (Miscellaneous Provisions) Act 1976, that allows for a local authority to pay a utility bill to either prevent disconnection or restore after disconnection, where the landlord is responsible for the supply but hasn’t paid the bill, which would seem to be the ideal solution in such cases but the renter would have to approach their local authority on that one, to which, all I can say is………Good Luck!
Leaving us really with “Derogation from grant” and “Breach of covenant for quiet enjoyment”, both of which cover the maintaining of utility supplies but in the event of supplies being interrupted through non-payment, as opposed to deliberate disconnection of disrepair everything gets very woolly and in any event resolving the problem would require civil action, for which legal aid may not be available and isn’t going to happen overnight while the renter is sitting in the dark with 3 jumpers on.
So to round up, if a renter has an arrangement in place over the payment of bills the landlord cant just raise this because their bills have gone up, unless of course the renter is willing to help them out but bear in mind if the contribution goes up, an agreement should also be arrived at where the contributions lower when the utility bills go back down, otherwise the renter gets stuck on the higher rate while the landlord reaps the extra benefit.
If the set-up is that the bill is in the landlord’s name but topping up pre-payment meters is down to the tenants, the law is less than helpful or straightforward. The above mentioned s33 would help but I don’t think I have done one of those since the mid 1990s and the renter will struggle to find someone in the council who knows about it and bear in mind, even if they can be persuaded that officer has to then persuade someone in the finance team that the council should be paying someone else’s utility bills and then create a method for the tenant to pay their rent to the council until the sum is recovered. It was never a streamlined process at the best of times when they were used more frequently
By Ben Reeve Lewis
