Who can sign Section 8 and Section 21 notices, and deposit certificates? We answer your top questions on how the landmark evictions ruling in the Northwood Solihull vs Fearn/Cooke/Ors case will affect landlords and letting agents.
The question of whether letting agents are authorised to sign eviction notices and tenancy deposit certificates on behalf of their landlords has now been answered in a landmark ruling in the Northwood Solihull vs Fearn/Cooke/Ors case. Here are the answers to some of the top questions lettings agents and landlords may have.
What is the Northwood Solihull vs Fearn/Cooke/Ors case?
The case arose when Northwood Solihull served a Section 8 notice to evict a couple who weren't paying their rent. The couple argued that the eviction wasn't valid under Section 44 of the Companies Act 2006 as the notice wasn't signed by either two authorised people or a company director with a witness - affecting the validity of the deposit certificate too.
After the first hearing, the judge ruled that Section 44 didn't apply to the eviction notices, but it did to the deposit certificate. The couple then appealed against the eviction ruling, and the landlord appealed against the deposit certificate ruling.
The result after the second appeal overruled the couple's attempt to argue that the notice and deposit certificates were invalid under Section 44 of the Companies Act 2006 - a positive for agents.
What is Section 44 of the Companies Act - and where did the confusion lie?
Dutton Gregory LLP explains that Section 44 of the Companies Act 2006 required documents executed on behalf of a company to be signed in accordance with one of three prescribed manners: either two directors, or a director and a company secretary, or a director before a witness.
However, the original legislation is unclear as to which documents need to be “executed” and which merely need to be signed by an employee or agent of the company.
Do sections or deposit certificates need to be signed by two directors or be witnessed?
No. For deposit protection certificates issued after the Deregulation Act 2015, the judgement showed that the documents presented in the case could be signed in accordance with Section 43, by a person with either express or implied authority.
As explained by David Smith, JMW Solicitors, this means that "any authorised employee of a landlord or letting agent can sign a Section 8 notice (and by extension a Section 21 notice) or a tenancy deposit certificate."
The authorised employee can be someone appointed by the landlord to sign on their behalf, and has authority to do so within your agency - which is why it's important to ensure your landlord Terms of Business are up to date.
Why did the ruling change on who could sign the deposit certificate?
For signing prescribed information, Dutton Gregory LLP explains that, as the definition of the landlord in the Housing Act 2004 includes someone authorised to act for the landlord, the Court decided that this interpretation should also be applied to deposit registration regulations from 2007 - meaning that an authorised agent could always have signed the tenant deposit certificate.
Who can legally sign a Section 8 notice?
When serving a Section 8 notice, either a landlord, licensor or landlord's agent can fill in and sign the notice using tenancy form 3. In the case of joint landlords or licensors, the form must be signed by at least one of them, or someone authorised on their behalf.
That authorised representative then has the opportunity to indicate their capacity to sign - and the landlord's agent is included in the list of suggested authorised options.
Who can legally sign a Section 21 notice?
The list of who can sign for Section 21 notices is similar to those required to apply for a Section 8 notice. However, there is no mention of the licensor as an option on the tenancy form 6a required to serve the no fault possession notice. Instead, the landlord or landlord's agent is allowed to complete and sign the Section 21 notice.
How will this ruling affect judgements in the future?
Smith shares that this is a "clear line for the Court of Appeal", meaning that it's unlikely that "technical defences" such as this will work in the future against Section 8 and 21 notices.
Tim Frome, Legal Associate Director at Hamilton Fraser echoes this sentiment for deposit certificates too. "It was never the intention of parliament for the deposit protection legislation to create technical reasons to penalise landlords," he says.
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