How the Renting Homes (Wales) Act 2016 changes the relationship between universities and students

What class of landlord does a university fall under?

Those who have read our first blog in this series titled “New terminology for housing law” will recall that the Act introduces the concept of two types of landlord. The category of landlord will help determine the category of contract which will apply.

University landlords are classed as private landlords, which is the category that applies to all landlords that are not a local authority, a registered social landlord or a private registered provider of social housing.

What type of occupational contract can a university grant under the Act?

Traditionally, university landlords have been allowed to rent out their accommodation by providing students a licence to occupy, as opposed to formal tenancy agreements, such as Assured Tenancy Agreements (ASTs). The option for university landlords to provide students licences only, allowed them to retain a high level of control over their accommodation; licences can be terminated easily if a student was in breach or ceased to study at the university.

Under the Act however, university landlords are now obliged to provide students an ‘occupational contract’. Standard contracts can be entered into by way of a fixed-term, or on a periodic basis.

University landlords are now under an obligation to provide their students with a ‘written statement’ containing all the terms of the contract. This written statement essentially serves as the contractual agreement between the university and the student  – replacing the licence or tenancy agreement that would usually be put in place.

Is there a standard form contract that universities can use?

The Welsh Government has published a suite of model occupational contracts which may be used by landlords. Many of the terms in the model contracts are Fundamental and therefore cannot be removed or modified, although some Supplementary terms can be removed or amended. Additional terms can be added so long as they are not incompatible with any of the other terms.

This means that university landlords will find that they will have heightened obligations towards their students. For example, university landlords will need to ensure that the accommodation meets the legal requirements of ‘fitness for human habitation’ which, amongst other things, means keeping a close eye out for mould, ensuring temperature levels are reasonable and pests kept at bay.

The model contract is really aimed at a strictly private landlord and tenant situation. It does not quite translate well into the differing relationship that exists between a university and a student.

When do universities need to serve the written statement by?

For student accommodation contracts that ‘converted’ to occupational contracts on the 1 December 2022 (i.e. they were already in place when the Act came into force), university landlords have until 1 June 2023 to provide the student with their written statement.

However, university landlords may see the benefit in getting the written statement out quickly – the Act makes vast changes to the terms of pre-existing agreements and in the absence of a clear and coherent written statement, both landlord and student will remain in the dark as to the new rights and obligations.

For any student accommodation contracts entered into on or after 1 December 2022, university landlords will need to provide their students with the written statements before or within 14 days of the student being entitled to occupy the accommodation.

We have been helping universities to amend the model contract to ensure that it is fit for governing this type of relationship. Please do contact us if you require advice or assistance in tailoring occupational contracts to ensure they meet your needs and as well as all the new legal requirements.

Ending student accommodation contracts

University landlords can continue to engage with students informally if disputes arise or a student falls into arrears.

However, should informal communication be unsuccessful, the Act provides for numerous ways an occupational contract can be brought to an end. These are separated into ‘no fault’ and ‘fault’ procedures.

Where the student has been found in breach of their contract then university landlords can serve a notice on the student and follow the respective notice period procedure before, if necessary, bringing a possession claim in court. There is also a new expediated process for ending a contract if the student has abandoned the property.

Where we anticipate issues will arise is in situations where a student is in no-fault, i.e. has not breached any term of their contract, except from the fact that they have failed to leave at the end of their fixed-term. In these situations, the Act prescribes that their contract would convert to a periodic contract. Such a conversion makes recovering possession of the student accommodation trickier and for university landlords to do so, as they will need to serve a notice but can only do so on the day the student overstays past the fixed-term.

The minimum notice that university landlords can give to a student who refuses to leave in these circumstances is two months (shortened from the new standard six months’ notice requirement applied to most private landlords). The effect of this is that a student who refuses to leave at the end of their fixed-term is in principle entitled to remain in occupation for a further two months before the university landlord can initiate any formal possession claim.

The new position is likely to be problematic for university landlords, who will often have a steady stream of students waiting to take over student accommodation rooms in the following academic year. Similar problems will arise for universities who dedicate their accommodation over the summer period for other uses, such as summer school accommodation, local authority temporary accommodation or holiday accommodation.

In conclusion…

Whilst the Act itself might seem daunting, with the correct advice and preparation, there is no reason for universities to be concerned.

Here at Capital Law, we can help landlords to adopt the new rules imposed by the Act by advising how best to implement and comply with these new changes. To discuss this further, please get in touch at c.good@capitallaw.co.uk.