The issue has the potential to hit RSLs with huge repayments to affected tenants.
Some housing sector advisors hinted that the two housing associations were becoming increasingly disillusioned with taking the full financial responsibility for a case that has the potential to affect the majority of RSLs.
But federation policy director Liz Potter told Housing Today: 鈥淭he federation is taking a co-ordinating role to get funding and work with lawyers to seek the broadest test case and resolve an issue that is a matter of public interest.鈥�
Not all RSLs were represented at the meeting, held in private at this week鈥檚 federation chief executives鈥� conference. But the federation is expected to send a letter to chief executives within the next month to try to ensure full sector cooperation.
One insider said: 鈥淚t shows that people are recognising that something needs to be done and a test case may turn out to be the only workable option.鈥�
The case involves section 13 of the Housing Act 1988, which says rent increase notices should follow the statutory form of notice, or be substantially similar. But some RSLs have changed the notices, potentially rendering them invalid.
A further issue is that of 鈥榓nnuality鈥�, where increasing rents on periodic tenancies before their first anniversary may become a legal problem.
It is believed the case could cost up to 拢1m.
The DTLR is understood to be considering a new, simpler form of the section 13 notice that should be in place for rent increases this April.
Potter said: 鈥淭he problem will not go away. We have looked at the issue very carefully and concluded it was in the best interest of the sector to pursue a co-ordinated and organised course.鈥�
Source
Housing Today
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