Draft Residential Tenancy (Jersey) Amendment Law 202- (P.24/2025): fourth amendment (P.24/2025 Amd.(4)) – amendment

STATES OF JERSEY

DRAFT RESIDENTIAL TENANCY (JERSEY) AMENDMENT LAW 202- (P.24/2025): FOURTH AMENDMENT (P.24/2025 Amd.(4)) – AMENDMENT

Lodged au Greffe on 2nd September 2025 by the Minister for Housing

Earliest date for debate: 9th September 2025

STATES GREFFE

2025  P.24/2025 Amd.(4)Amd.

DRAFT RESIDENTIAL TENANCY (JERSEY) AMENDMENT LAW 202- (P.24/2025): FOURTH AMENDMENT (P.24/2025 AMD.(4)) – AMENDMENT

1  PAGE 2, AMENDMENT 2 –

Delete amendment 2(2).

2  PAGE 3, AMENDMENT 12 –

In amendment 12, new paragraph 12 of Schedule 1, delete "that are no more favourable to the landlord than the tenant and".

MINISTER FOR HOUSING

REPORT

The Scrutiny Panel has proposed an amendment (Amendment B2)[1] to the Draft Amendment Law to ensure that any break clauses within residential tenancy agreements, for ending an initial fixed term early, operate equally for both the landlord and tenant. The Panel also wishes to make it mandatory for initial term contracts to include at least one specified requirement dealing with early termination.

Under the Draft Amendment Law, an initial term agreement must specify the requirements a landlord and tenant must satisfy to end the agreement early without needing a reason (Schedule 1, paragraph 12). In addition to satisfying the specified requirements, a landlord must give 3 months' notice, and a tenant must give 1 months' notice (Article 6D). I brought forward P.24/2025 (Amd.(2)) [2]to ensure that at least one requirement must be set out in an initial term agreement before it can be ended early, offering the example of allowing the tenancy to be ended early after the first year.

Whilst I am instinctively sympathetic to the Scrutiny Panel's desire to guard against one-side break clauses (presumably that favour landlords over tenants), there is reason to be believe that the Panel's proposed amendment is unnecessary further to P.24/2025 (Amd.(2)), and that it may be unworkable in practice, with the unintended consequences outweighing any perceived benefits.

The Draft Amendment Law as amended by P.24/2025 (Amd.(2)) makes the situation regarding ending a tenancy early very clear. It reflects normal contractual bargaining between parties, with landlords free to set early break requirements, and tenants free to negotiate and/or decide whether the  requirements  are  acceptable  and,  if  so,  enter  an  agreement  in  full  knowledge  of  the implications. Should the Court be called upon to consider a dispute, the provisions as amended by my amendment simply require the Court to make a binary determination as to whether the early break requirements have been met, which is a question of fact.

Amendment B2, on the other hand, is potentially problematic because it is unclear who would determine whether the requirements are more favourable to the landlord.[3] Furthermore, the question of what is favourable to a person involves an element of subjectivity, so it would always be open to the landlord to argue that they considered that requirements were not more favourable to them to utilise Article 6D.

Under Amendment B2, should the Court be asked to consider a dispute, rather than consider matters of fact, it would also need to determine whether early break provisions are preferential to one party over the other, which is inherently subjective, and creates uncertainty. More generally, it is possible there will be increased demands on the Court to consider disputes about the parity of early break requirements.

Amendment B2 could also result in other unintended consequences, some examples of which are set out as follows:

• A  landlord  might  knowingly  set  more  favourable  early  break  requirements  for themselves, knowing that the tenant must still meet any (potentially stringent) break requirements should they wish to end the tenancy early, with the only repercussion for the landlord being that they cannot end the tenancy early; of little consequence if they had no desire to be able to do so in the first place. Landlords would also be aware that they retain the safeguard of being able to end an initial term early under grounds listed in Article 6F should a tenant behave badly.

• Using Article 6D may prove problematic for landlords, because they would need to set requirements at the time of entering an initial term agreement that do not, at some future point of the tenancy, turn out to be more favourable for them.

• To be compliant, landlords may feel compelled to set early break requirements that are neutral in nature, so that there can be no question of the requirements being more favourable to them (e.g., restricted to a requirement such as a minimum time limit). This would significantly limit parties' contractual freedom and interfere with the ability to set requirements that offer an adequate means of redress to an initial term being ended early.

I recognise the Panel's efforts and sentiment in advocating for equality of break clauses. But I believe the best and most workable means for how an initial term can be ended early is to enhance transparency, with parties entering into agreements aware of their obligations, and tenants free of hidden costs or surprise requirements not set out in their contract.

Due to the concerns set out above, and considering when in the running order Amendment B2 is likely to be debated in the States Assembly, I seek to amend Amendment B2 so that it has the same effect as P.24/2025 (Amd.(2)).

Financial and staffing implications

There are no new financial and/or staffing implications.

Children's Rights Impact Assessment

A Children's Rights Impact Assessment (CRIA) has been prepared in relation to this proposition and is available to read on the States Assembly website.

[1]1 See Amendment B2 in DRAFT RESIDENTIAL TENANCY (JERSEY) AMENDMENT LAW 202- (P.24/2025): FOURTH AMENDMENT

[2]2 See Ending an initial term early section, DRAFT RESIDENTIAL TENANCY (JERSEY) AMENDMENT LAW 202- (P.24/2025): SECOND AMENDMENT

[3]3 It makes sense for it to be the landlord who makes this determination but the amendment leaves it uncertain.