Wait, the Tribunal does that?

A recent decision in Your Home Partners vs Michael Kellichan and Michelle Hood provides important clarification for landlords on a recurring jurisdictional issue in Scotland: Where should claims for rent arrears arising from a private residential tenancy be raised once the tenancy has ended?

Sheriff MacRitchie confirmed in Kirkcaldy Sheriff Court earlier this year that such claims remain within the exclusive jurisdiction of the First-tier Tribunal (Housing and Property Chamber), even after the tenancy has terminated. The decision reinforces the broad scope of section 71 of the Private Housing (Tenancies) (Scotland) Act 2016 and draws a firm line between ordinary civil debts and disputes arising from a private residential tenancy.

Background

In this case, the landlords (trading as Your Home Partners) sought payment of £5,000 in alleged rent arrears from former tenants, (Mr Kellichan and Ms Hood) following the termination of a private residential tenancy agreement. The landlords raised the matter as a simple procedure action in the sheriff court, arguing that because the tenancy had already ended, the dispute was no longer a housing matter but instead an ordinary debt recovery claim.

The landlords sought to argue that once the tenancy had terminated, the First-tier Tribunal no longer had competence to deal with the matter and that the sheriff court was therefore the correct forum. The sheriff rejected the claim at the initial stage on the basis that jurisdiction belonged to the First-tier Tribunal under section 71 of the 2016 Act.

The significance

The decision is significant because it addresses a wider misunderstanding that continues to arise in Scottish housing litigation. Some landlords have tried to characterise post tenancy rent arrears as ordinary debt recovery actions and pursue them through the Sheriff Court.

This case makes clear they cannot do so. One of the significant differences between cases in the Sheriff Court and the Tribunal relates to recovery of costs for proceedings. While the Sheriff Court will usually award expenses in the event of a successful claim, the Tribunal will only make an award of expenses in exceptional cases where the conduct of the losing party has been unreasonable. While the Tribunal is said to be less formal than court, anecdotally, cases in the Tribunal are slower to progress than the Sheriff Court, meaning landlords may have to wait longer to secure an award for payment of arrears.

Conclusion

The judgment confirms that Parliament’s intention was to create a specialist forum for landlord and tenant disputes to be heard in the First-tier Tribunal with the aim of improving consistency, accessibility and expertise in housing matters. Allowing claims for rent arrears after a tenancy has ended to return to the Sheriff Court would undermine that purpose.

Private landlords should bear in mind that all tenant related claims are likely to be dealt with by the Tribunal and seek advice if in any doubt.