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England

Mutual exchange refusal

A landlord can serve a notice of refusal to consent to a mutual exchange if certain grounds apply, including when the tenant is subject to a court order or the property is unsuitable.

This content applies to England

A mutual exchange is where two or more social tenants swap their tenancies with each other.

Mutual exchange normally takes effect by assignment. Find out more about mutual exchange for social tenancies on Shelter Legal.

A landlord might be able to refuse consent for an exchange when the:

  • tenant has rent arrears or is in breach of their tenancy

  • tenant is subject to a possession or or court proceedings

  • property is unsuitable for the tenant's needs, for example the property is too large

Secure or assured tenant exchange

When a secure tenant intends to exchange with another secure or assured tenant, a local authority landlord can only refuse consent for a mutual exchange on specific grounds. The grounds are set out in schedule 3 of the Housing Act 1985.

A housing association can refuse consent for other reasons. Where the tenancy agreement states that a housing association tenant cannot assign without consent, consent should not be unreasonably withheld.

Exchange with a flexible or assured shorthold tenant

When a secure or assured tenant intends to exchange with a flexible or assured shorthold tenant, a landlord can only refuse consent for a mutual exchange on specific grounds. The grounds for refusal are set out in schedule 14 of the Localism Act 2011.

Refusal when the tenant has rent arrears or has breached their tenancy

A landlord can insist that rent arrears are cleared or a breach of the tenancy is remedied before an exchange can proceed.

Secure or assured tenant exchange

When an exchange takes place between secure or assured tenants, a landlord can give consent which is conditional on a tenant paying off any rent arrears or remedying a breach of tenancy.[1]

Secure or assured tenant exchange with a flexible or assured shorthold tenant

When an exchange is between a secure or assured tenant which began before 1 April 2012 and a flexible or assured shorthold tenant, a landlord can refuse to consent to the mutual exchange if the tenant is in rent arrears or in breach of their tenancy.[2]

A landlord might agree to give consent if the tenant pays off their arrears or remedies any breach of tenancy.

Discretionary grounds for possession

A tenant might consider offering to pay off another tenant's arrears in order to allow a mutual exchange to proceed.

The landlord of a secure tenant can serve a notice seeking possession on discretionary grounds if either tenant makes a payment as part of the agreement to exchange.[3] Find out more about secure tenancy grounds on Shelter Legal.

Refusal when the tenant is subject to court proceedings

A landlord can refuse consent for a mutual exchange when the tenant or proposed assignee is subject to certain court proceedings.

This includes when the tenant or proposed assignee:

  • is obliged to give up possession under a court order[4]

  • has had possession proceedings, or a notice served on them, under grounds 1 to 6 for secure tenants[5]

  • has had a notice served on the antisocial behaviour mandatory ground[6]

  • is subject to a court order relating to antisocial behaviour or waiting to go to court[7]

Antisocial behaviour orders

A court order relating to antisocial behaviour includes when:

  • a secure tenant is subject to a suspended ground 2 or 2ZA possession order

  • an assured tenant is subject to a suspended ground 14 or 14ZA possession order

  • the property is subject to a closure notice

Find out more about secure tenancy grounds and assured tenancy discretionary grounds on Shelter Legal.

Exchanges with a flexible or assured shorthold tenant only

Some reasons for refusal only apply to exchanges under s.158 Localism Act 2011. This is when a secure or assured tenant exchanges their tenancy with a flexible or assured shorthold tenant.

Find out more about mutual exchanges for social tenancies on Shelter Legal.

This includes where:

  • the tenant or proposed assignee has had possession proceedings, or a notice served on them under grounds 9 to 17 for assured tenants.[8]

  • the tenant or proposed assignee has had possession proceedings, or a notice served on them under ground 7A, the absolute ground for anti-social behaviour[9]

A landlord can refuse to give consent for certain grounds which relate to the property itself.

Accommodation is unsuitable or needed for another purpose

A landlord can refuse to give consent to a mutual exchange when the accommodation is unsuitable or needed for another purpose.

This includes when the accommodation:

  • is not suitable for the needs of the proposed assignee and their family, for example if it is too large[10]

  • was let to the tenant because of their employment[11]

  • is adapted for a person with disabilities and the exchange would mean a person with disabilities would no longer live there [12]

  • one of a group of properties let to people with special needs, special facilities are available nearby, and the exchange would result in the people with the special needs no longer living there[13]

Assignment conflicts with the landlord's purposes

A landlord can refuse consent where the assignment would conflict with the purposes of the landlord because they are a charity or specialist housing association.[14]

Assignee refuses housing association membership

A landlord can refuse consent where both:[15]

  • the property is managed by a type of housing association requiring a proportion of tenants to be members of the association

  • the assignee refuses to become a member

The assignee is the person the tenancy is assigned to under a mutual exchange.

Accommodation for specific groups

A landlord can refuse consent where:[16]

  • the landlord is a housing association or housing trust

  • which lets accommodation only for people whose circumstances (other than merely financial circumstances) make it difficult for them to find housing

  • the mutual exchange would mean that such a person would not be residing in the property

Planning restrictions

This ground for refusal could include where a proposed mutual exchange breaches restrictions under a section 106 planning agreement.

Section 106 Town and Country Planning Act 1990 allows a local authority to place legally binding obligations on a developer when it approves applications for planning permission. For example, the agreement can govern how a social housing property is let based on local connection or affordability.[17]

Notice of refusal for a mutual exchange

A landlord who refuses permission for a mutual exchange must serve notice of their reasons on their tenant.

The notice must be state the grounds for refusal and be served within 42 days of the application to exchange.[18]

A landlord can give conditional consent to an exchange between a secure tenant and another secure or an assured tenant. For example, consent could be conditional on the tenant clearing their rent arrears or remedying another breach of the tenancy, even after the 42 day period has expired.[19]

If a landlord withholds consent any other reason, consent is treated as given and the assignment can proceed.[20]

After 42 days has passed

The council landlord loses the right to refuse consent if it has not given a tenant a notice of refusal after 42 days.

Where a landlord loses the right to refuse consent, a tenant could consider assigning their tenancy without consent after 42 days has passed. A tenant who intends to assign their tenancy without consent should notify their landlord and give time for them to object. The tenant should seek to persuade the landlord to give consent.

A secure tenant who is seeking to exchange with a secure or assured tenant can apply for a court order to compel the landlord to give consent.[21] A tenant cannot get legal aid help to apply to court.

A tenant might be able to challenge a reason for refusal by:

  • submitting a complaint to the landlord

  • escalating the complaint to the relevant Ombudsman

Find out more about complaints against social housing providers on Shelter Legal.

Complaints to the Housing Ombudsman

The Housing Ombudsman handles complaints against social landlords, including local authorities and housing associations.

Find out more about complaints to the Housing Ombudsman on Shelter Legal.

Footnotes

  • [1]

    s.92(5) Housing Act 1985.

  • [2]

    ground 1 and 2, sch 14 Localism Act 2011.

  • [3]

    ground 6, sch 2 Housing Act 1985.

  • [4]

    ground 1, sch 3 Housing Act 1985; ground 3, sch 14 Localism Act 2011.

  • [5]

    ground 2, sch 3 Housing Act 1985; ground 4, sch 14 Localism Act 2011.

  • [6]

    ground 2, sch 3 Housing Act 1985; ground 4A, sch 14 Localism Act 2011.

  • [7]

    ground 2ZA and ground 2A, sch 3 Housing Act 1985; ground 5A and ground 6, sch 14 Localism Act 2011.

  • [8]

    ground 5, sch 14 Localism Act 2011.

  • [9]

    ground 5A, sch 14 Localism Act 2011.

  • [10]

    ground 3 and 4, sch 3 Housing Act 1985; ground 7 and 8, sch 14 Localism Act 2011.

  • [11]

    ground 5, sch 3 Housing Act 1985; ground 9, sch 14 Localism Act 2011.

  • [12]

    ground 7, sch 3 Housing Act 1985; ground 11, sch 14 Localism Act 2011.

  • [13]

    ground 9, sch 3 Housing Act 1985; ground 13, sch 14 Localism Act 2011.

  • [14]

    ground 6, sch 3 Housing Act 1985; ground 10, sch 14 Localism Act 2011.

  • [15]

    ground 10, sch 3 Housing Act 1985; ground 14, sch 14 Localism Act 2011.

  • [16]

    ground 8 sch 3 Housing Act 1985; ground 12, sch 14 Localism Act 2011.

  • [17]

    s.106(1) Town and Country Planning Act 1990.

  • [18]

    s.92(4) Housing Act 1985 and s.159(3) Localism Act 2011.

  • [19]

    s.93(5) Housing Act 1985.

  • [20]

    s.92(6) Housing Act 1985 and s.159(2) Localism Act 2011.

  • [21]

    s.110 Housing Act 1985.