Letting Agents and Property Managers need to be aware of new requirements affecting them concerning Legionnaires Disease.

The Health and Safety Executive has issued a revised Code of Practice regarding the control of legionella bacteria in water systems.

This underlines the legal requirements for landlords and managing agents to ensure that the risk from exposure to legionella from all water systems in residential rental premises is controlled.

The requirement is essentially to undertake a risk assessment which should include:

• Whether the conditions are right for bacteria to flourish in water temperatures from 20 to 45 degrees.  Areas of stagnant water, infrequently used outlets, debris in the system and thermostatic mixing valves should be inspected.
• Assess whether any particular tenants such as older people or those already ill might be vulnerable to infection.
• Records must be kept for at least five years and must include details on all aspects of risk assessment control.

Steps to control could include:

• To raise the temperature of warm water.  However,  care must be taken that this does not lead to possible problems with burning or scalding.
• Disinfect the system
• Insulate pipework
• Keep water systems covered and free from debris
• Regularly flushing through systems that are rarely used, such as showers.

Practical Steps you should consider to show due diligence:

Terms of business

• Amend to require landlord to confirm property is safe.
• Amend to confirm that on a management service the landlord will allow the agent to take any necessary steps if a problem is found.
• Amend to confirm that the landlord is responsible for the ongoing safety of the property if agent has only been responsible for finding a tenant and has no further management obligations.

Tenancy agreement

• Add clause requiring the tenant to flush through the showers and taps etc following a period of non use.

Tenant advice

• Add to tenant advice sheet the precautions that they need to be aware of.

Property Management staff

• Train to note that any report of hot water not being hot should trigger concerns about possible Legionnaires’ disease.
• Add to log for each property any action that has been taken.
• Train to note that on any change of tenancy whether they are vulnerable occupants.

Property visit

• Amend property visit form to include any check for leaking showers, boilers or taps.
• Include notes for any areas of stagnant water.
• Include notes for any infrequently used outlets.

For further information see ‘Legionnaires’Disease. The control of legionella bacteria in water systems. Approved Code of Practice and Guidance. L8 (second edition) HSE Books

Please note:  This information is intended as guidance only and should not  be considered as exhaustive.

The new Regulations concerning Energy Performance Certificates will come into force on 6^th April 2012.

These new regulations apply both to Estate Agents and Letting Agents.

The new requirements are that:

• The duty to provide an EPC is on the potential vendor or landlord
• However an agent acting on behalf of the vendor or landlord has a duty to satisfy themselves that an EPC is available or has been commissioned before marketing can commence
• The EPC must be secured using ‘reasonable efforts’ within 7 days
• If after that 7 days the EPC has still not been secured  ‘despite using all reasonable efforts’ the relevant person will have a further 21 days to do so
• The Trading Standards Officers will be authorised to require agents to produce evidence showing that an EPC has been commissioned where they are marketing a property without one.

In addition there are changes in what must be included in the marketing materials:

• It will no longer be sufficient just to have the asset chart on its own included in the marketing material.  Any marketing material must include the first page of the newly styled four-page EPC (which includes the asset chart as well as other information that should help a buyer/tenant assess what the running costs might be)
• Written particulars include emails
• Written particulars are defined as containing at least two of the following:

A photograph of the building or a room therein

A floor plan of the building

The size of rooms in the building

The measured area of the building OR

In relation to a building to be let, the proposed rent

Which marketing material do the Regulations apply to?

The following is based upon the latest advice from the Department of Communities and Local Government (dated 23^rd March 2012).  They, and we, stress however that it is not Legal advice as ultimately the Courts will rule upon a definitive interpretation of the legislation.

The Regulations do not apply to all property advertisements.  They apply only to the more detailed descriptions, printed or electronic, produced for potential buyers or tenants.  This, in essence, is where an agent provides written particulars to a specific individual who may be interested in buying or renting the property.

This means that:

• Items such as newspaper advertisements or window cards normally will have no requirement to include these details
• Auction catalogues will need the EPC attached if they include two of the items as mentioned above
• Property portals will need the EPC attached if they include two of the items mentioned above.

The penalty for non-compliance is £200 per property

The new Regulations will not apply to properties already on the market at that date as long as they have been continuously marketed since before that date.

Once an EPC has been completed agents will be able to retrieve an electronic version of it from the Property Agents EPC Retrieval Service in order that they can display it on their electronic advertising.  Agents will need to register for this service

Changes to the law relating to the protection of tenant deposits were introduced in the Localism Act of 2011 but as yet have not been implemented.

We are led to believe that these changes will come into effect on 6^th April 2012.

What this means in practice is that:

• New tenancies created on or after 6^th April 2012 will be covered by the new requirements
• Existing tenancies on that date will have 30 days to comply with the new requirements, if they do not already do so.
• The new requirements will only apply to relevant Court proceedings when those proceedings started on or after 6^th April 2012.  Proceedings initiated before 6^th April will be dealt with under the old requirements.

The new regulations state that:

• The deposit must be protected and the Prescribed information must be provided within 30 days from receipt of the deposit
• This is an absolute limit and the tenant will be able to make a claim from 31 days after the deposit payment EVEN IF the requirements have subsequently been met.
• Failure by the landlord to undertake the requirements within 30 days will seriously limit his ability to serve a Section 21 notice EVEN IF by the time he wishes to serve it the deposit has been properly protected.
• Penalties will include the requirement to return the deposit to the tenant and a payment to the tenant of between one and three times the deposit.
• The tenant can make a claim to the court EVEN WHEN a tenancy has ended.

So please make sure that all your deposits have been properly protected before 6^th April and that you have in place watertight procedures to make sure that all subsequent tenancy deposits are fully dealt with within 30 days of receipt of the deposit.

In April 2011

The LHA rate for 5 bedroom properties was removed to a maximum level of 4 bedrooms

•  There are absolute caps on the LHA and these cannot exceed:
•  £250   1bed
• £290   2 bed
• £340   3 bed
• £400   4 bed

The £15 weekly excess was removed

In October 2011

• LHA rates are set at 30^th percentile of the Broad Rental Market Area (BRMA) rather than the previous median level, or 50^th percentile.  This is applicable to new claimants with immediate effect and from the anniversary date of the claim for existing claimants.

CHANGES TO LOCAL HOUSING ALLOWANCE (LHA) IN 2012

From January 2012

The ‘shared accommodation’ rate will apply to those under 35 rather than the previous age limit of under 25.

This will directly impact on new claimants who will receive less allowance from this date

The weekly LHA applicable to individual BRMA can be obtained at https://lha-direct.voa.gov.uk/search.aspx

The Office of Fair Trading has produced a Draft Guidance to the Consumer Protection from Unfair Trading Regulations 2008 expressly aimed at estate agents.  You will be aware already that these Regulations are in many ways more far reaching than the Property Misdescription Act.

The OFT have been conducting a consultation programme on this guidance and GKJ Consultants Ltd have been involved in this process.  The final version of the Guidance is due out early in 2012 and we will keep you informed of developments on this document.

The Localism Act 2011, which was passed last month, contains
some amendments to the law relating to the protection of tenants deposits.  As you are probably aware, the original
legislation (in the Housing Act 2004) that came into force in April 2007 has
had some problems due to  interpretations
placed upon it by decisions of  various
Courts. The result has been that it has not functioned as it was intended to.  The changes in the Localism Act are designed
to correct the faults in the original legislation and make some changes to the
timescale available for protecting the deposit and the penalties for
non-compliance.

Bribery Act 2010

 The Bribery Act 2010 will finally come into force on 1^st July 2011.

 It applies to all UK companies and organisations and to any offence committed worldwide.

 The Act introduces four main offences:

• Offering, promising or giving a bribe. This is ‘active’ bribery
• Receiving a bribe. This includes requesting, agreeing to receive or accepting a bribe. This is ‘passive’ bribery
• Bribing a foreign public official (with the intention of obtaining or retaining business or an advantage in the conduct of business)
• Failure by a commercial organisation to prevent a bribe being paid for on its behalf

 Definition of Bribery

The Act defines it as ‘the receiving or offering of an undue reward by or to any person whatsoever in public office or in a business capacity in order to influence his behaviour and include him to act contrary to the known rules of honesty and integrity’.

 A bribe does not have to be actually paid for an offence to have been committed: merely the promise will be sufficient. This does not need to be deliberate but may be accepted unwittingly.

 A commercial organisation can be convicted of failing to prevent bribery by its representatives acting in the course of their business.

 Recent guidance published by the Ministry of Justice suggests that the law is not intended to make the acceptance of apparently harmless gifts (e.g. a bottle of alcohol) or the provision of normal corporate hospitality  offences under the Act. This guidance suggests that a risk-based approach should be adopted.

Corporate hospitality therefore should be reasonable, proportionate and not excessive.

 However it must be remembered that this is only advice and is not binding on Courts. Until the Courts have made rulings any employee must be wary of accepting, offering, or agreeing to accept any gift.

 Penalties

• The maximum penalty for an individual is ten years imprisonment and an unlimited fine.
• The maximum fine for an organisation is an unlimited fine

 Defence

 The only defence is to establish that adequate procedures were in place to prevent any contravention of the Act. Senior management can be held personally liable and ignorance is not a defence.

 The advice from the Ministry of Justice suggests six principles to be adopted

• Risk assessment – assess where the problem areas may be
• Top-level commitment – senior management should be involved and concerned
• Due diligence
• Clear, practical and accessible policies and procedures
• Effective implementation of those policies
• Monitoring and review

 What should you do?

 Hopefully principals, partners and directors will already have procedures in place to prevent wrongdoing by staff but it may be helpful to consider other aspects of your procedures

• Staff training on the implications of this legislation and clear guidance on what they are and are not allowed to do
• Changes or amendments to your Code of Conduct to reflect this new legislation
• Amendments to your Contract of Employment, again to reflect any changes in procedure you may introduce.