20 February 2014 by Yezdan Izzet

Landlords, Tenants and Agents Beware!

As part of the Government’s proposals for improving standards in the private rented sector, the Enterprise and Regulatory Reform Act 2013 provides the Secretary of State with the power to require “all persons that engage in letting and property management work” in England to become a member of either (i) a government administered redress scheme; or (ii) an approved redress scheme by the Secretary of State.

The idea behind the redress scheme is to provide landlords and tenants with a more cost effective and efficient way to resolve disputes that may arise in relation to the letting and management of rented residential property, as an alternative to court proceedings.  The scheme will provide a mechanism for investigating and determining complaints against its lettings and managing agents that are members of the scheme by an independent person.

This redress scheme is still at a very early stage as the Redress Schemes for Lettings Agency Work and Property Management Work (Approval and Designation of Schemes) (England) Order 2013 only came into force in England on 14 December 2013.  The Order merely sets out an outline of the following: –

  1. the procedure and requirements on making an application for approval of a redress scheme and the conditions which must be satisfied before approval may be given;
  2. the conditions which must be satisfied before a scheme may be designated as a government administered redress scheme;
  3. the conditions with which a scheme must comply;
  4. the withdrawal of an approved scheme;
  5. revocation of an administered redress scheme.

The Department for Communities and Local Government has published its proposed conditions that deal in more detail with: –

  • the procedure for setting up a redress scheme;
  • how the redress schemes will be managed and administered; 
  • membership of the redress schemes and what is expected of its members; 
  • the procedures in ensuring that the scheme’s rules are complied with; 
  •  how non-compliance will be dealt with; 
  • what types of disputes the scheme can deal with; and 
  • how decisions and what penalties can be made etc. 

The conditions can be found in full at the website here.

The application process for the setting up of the schemes (not for membership of the schemes) has started and the applications are expected to be assessed by 7 April 2014 (although this date may change).  It will be interesting to see how the schemes will come about and how they will be managed. 

If you are a landlord, tenant or letting agent and wish to discuss this further please do contact us at info@boltburdon.co.uk

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