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England and Wales: becoming increasingly different 11 February 2015

It is rare – although of course not unknown – for lawyers to be dual-qualified in Scotland and in England-and-Wales.  I have the utmost admiration for people with that ability.

Until recently, the idea of becoming capable of advising in England or in Wales – but not in both – was not on anyone’s radar.  Surely this could not be necessary?  Increasingly, however, the law in the two countries is diverging, and I provide three examples below.  The first two are still at a draft stage, although I think they are inevitable.  The third has already happened.

Obviously, the Welsh Government is entitled to legislate as it wishes, with the consent of the people of Wales.  But law that differs between England and Wales causes at least three problems for solicitors, it seems to me.

First, it is novel.  To lawyers physically working in England, in particular, it is an unfamiliar concept and it will require a new way of thinking.  It is a particular issue with property law and landlord and tenant law, of course.

Secondly, it is not going to be easy to remember when the law in Wales differs from the law in England.  Even researching whether the law in Wales is different from the law in England may not be very easy.  (In a number of cases, in fact, the dividing line as to where the Welsh Government has jurisdiction is a bit blurred, although that is a separate issue.)

Thirdly, even when you know the law in Wales is different from the law in England, you will have to become familiar with both laws.  While we were talking about differences in the Use Classes Order (there is no Class A4 or Class A5 in Wales, for example), that did not pose too many problems.  The first and second examples that I provide below will require a great deal more time devoted to them.

SOME EXAMPLES

So here are three examples.

Residential tenancies

The Welsh Governmnent has just published the Renting Homes (Wales) Bill.  The Bill seeks to implement the Law Commission’s Renting Homes Bill (published as long ago as April 2006, and since ignored by the Government in Whitehall), but not quite as we know it, Jim.

This is not a subject with which I am familiar, and so I recommend that you read this post “Let’s all move to Wales” from the wonderful Nearly Legal website.

If you are going to advise on residential tenancies in both England and Wales, and this Bill becomes law (as I imagine it will do), you are going to have to learn a lot of new law – and remember where the law in Wales differs from the law in England.  Similarly if you are an investor or a RSL in both countries, I imagine that you are going to have to change some of your practices.

Stamp Duty Land Tax

This is scary.  The Scots currently pay SDLT, but will be switching to a different land tax in April – Land and Buildings Transaction Tax.

Now it looks as if the Welsh might be switching from SDLT to their own land tax as well.  Yesterday the Welsh Government issued a consultation document entitled Tax devolution in Wales – Land Transaction Tax.   Responses have to be submitted by 6 May 2015.  The proposed new tax would take effect in 2018.

I do not think that I will be responding to this consultation, but if you have views, you need to respond.  (Incidentally in relation to the Minimum Energy Efficiency Standard regulations – to be covered in a blog article tomorrow – DECC received just 49 responses to its consultation last summer.  This was cunningly timed to span exactly the summer holiday period – but surely more people are interested in such important topics.)

Residential tenancy deposits

The Housing (Tenancy Deposits) (Specified Interest Rate) (Revocation) (England) Order 2015 (SI 2015/14) might well be an example of where the law in England is diverging from the law in Wales, as opposed to the other way around, as in the two previous examples.

The statutory instrument mentioned above repeals the Housing (Tenancy Deposits) (Specified Interest Rate) Order 2007, which applies in both England and Wales – but the repeal applies only in England.  So this is creating a new kind of complexity.  As well as legislation that is stated to apply only in England from the outset, or to apply only in Wales from the outset, we now have legislation that used to apply in both England and Wales but now applies only in Wales because it has been repealed in England.  (In fact, I think that in this instance the repeal is taking place because the provision is no longer relevant – but that might not be the case in the future.)

In case anyone cares, the reason for the repeal of the 2007 Order is explained as follows:

“This Order revokes the Housing (Tenancy Deposits) (Specified Interest Rate) Order 2007 (“the 2007 Order”) in England only. The 2007 Order specifies the rate of interest payable by a custodial tenancy deposit scheme on amounts of deposits repaid to tenants and landlords by the scheme at the end of a tenancy. The 2007 Order was only relevant so long as the arrangements under section 212(1) of the Housing Act 2004 – that is, the arrangements under which the tenancy deposit schemes are established – provided for deposits repaid to tenants and landlords to be paid with interest. In England, those arrangements were changed in 2010 to provide that such amounts were no longer required to be paid with interest. The 2007 Order is therefore redundant in England.”

Notice that this explanatory note does not comment upon whether or not the arrangements that were changed in 2010 in England were also changed in Wales.  It is not clear therefore whether the 2007 Order is also redundant in Wales, or whether it still serves a purpose.  That is probably a question that is of interest only to connoisseurs of tenancy deposit schemes, and I don’t count myself among them.

This statutory instrument is, incidentally, a fine example of a statutory instrument that incorporates four words or phrases within brackets.  They are relatively rare.  I have yet to see a statutory instrument that incorporates more than four words or phrases within brackets.  No doubt readers will let me know if they are aware of one.

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