After an illuminating conversation with the WAG assistant head of housing policy last Friday where I brought up the main outstanding questions we all have regarding the conversion of asts to OCs.
We must first get the feel of the terminology regarding this -
Written statement (in the transition period) is the document we give to our CHs explaining the differences between the old and new contracts,
Substitute Contract will be a renewal contract immediately after the last day of the ast or rental period in that periodic and substantially the same as the old ast (now converted OC)
Occupation Contract will be an absolutely new contract agreed & signed since Dec1st 2022.
Whereas the fear factor introduced around the penalties for not completing the written statement correctly made us look for a less risky alternative and this alternative was seen to be an agreed and signed new contract this is not the whole story.......
In the Act it states that written statements must be completed by the end of May and this is 'come what may' - whatever you do, in order to fully comply, this written statement must be served to fully convert the ast to the new Act. Unfortunately the new contract agreed and signed and thought to be common sense to be the 'written statement' as well is not to be, it will be a valid contract but a written statement still must be sent.
Caveat #1-If the contract is ended before the end of May then a written statement is not required
Caveat #2 -A written statement is definitely not required in order to serve notice but if the proceedings look like passing the end of May then a written statement must be served by the end of the transition period
A substitute contract (renewal) will retain most of the transition privileges with the exception of s186 notice within the fixed term - substitute means substantially the same as the preceding contract and commences immediately after the last one
Obviously a brand new contract will lose the transition period privileges.
A Universal written statement which has been cleverly designed for ease of preparation has not been fully approved by WAG or RSW - I fail to see why not though. I believe that it may be a case of the WAG think that someone is being too clever and making it too easy for agents and landlords - and they would not want that! They have the reasoning that it does not exactly fit the spirit of the transition regulations.
The more I look at the universal WS the more I think that it will eventually be accepted however, will it be too late to complete them by then unless the landlord has taken the punt and used them? The main issue appears to be that they feel the Contract Holder needs their hand held a bit more and should not be expected to work out anything for themselves regarding the changes. I believe that it clarifies more easily than the approved written statement method and let's face it, how many Contract Holders are going to ever get through the reading of this, a simplified contract, as previously stated to be the main raison d'etre for the Act itself! If a Universal Written statement is chanced it will have to have a Plan B in the background asap just in case.
Is there therefore any reason to complete a substitute contract after the written statement? I believe if the landlord just wants to let the contract roll forever then no but in order to attempt to wash out any possible errors in the written statement from the new contract onward as the old terms have ended and perhaps agree new terms - yes.
Therefore does the old one have to be surrendered? A statutory periodic only survives monthly and so ends monthly anyway (unless contractual) and a fixed term that ends on a certain date ends anyway. (It will be different for contractual periodics which may have to be surrendered to set up a substitute contract).
NB the only way therefore for a written statement to be unnecessary is that a contract has to be surrendered and then the new contract cannot start immediately - there has to be a gap and this is likely to not be manageable.
To summarise somewhat - do a written statement asap and before the end of May and you will have complied. If you have already completed a substitute contract then serve a written statement to cover the period between Dec 1st and the start date of the substitute contract.
As usual this all comes with a Caveat that this is as the Legislation stands today but there are more Regulations being prepared by the WAG which apparently will include a clarification of the above.
