Withdrawal of a Contract-Holder (Where There Is More Than One)
There are significant changes to the notice a contract-holder must give to a landlord with the introduction of the Renting Homes (Wales) Act 2016 ("the Act").
Contract holders now have provisions to withdraw from a contract.
The withdrawal of a contract-holder may only be dealt with under the terms of the occupation contract (s.57), and in the main, those terms are fundamental terms, which means they are very limited in what can be changed by the landlord.
There's no right for a joint contract-holder to withdraw during any fixed term.
During periodic, a joint contract-holder may withdraw from the contract by giving notice (a "withdrawal notice") to the landlord (s.130).
The notice must specify when they intend to cease to be a party to the contract (the "withdrawal date").
A supplementary term defines the length of notice as one month's notice. However, because it's supplementary, the length of notice can be changed by agreement (and it doesn't have to improve the position of the contract-holder). The length of the notice required will be shown in the written statement of the occupation contract.
They must also give the other joint contract-holders a written warning, and a copy of the withdrawal notice must be attached to the warning.
The landlord must give the other joint contract-holders a written warning as soon as reasonably practicable after receiving the withdrawal notice. A copy of the notice must be attached to the warning.
The withdrawal notice can contain more than one joint contract-holder, but it cannot contain all of them (if it had all names, it would be a notice to end the entire contract -- see ending a tenancy).
Suppose notice from one or more contract holders (but not all) purports to be a notice ending the entire contract. In that case, it will be treated as a withdrawal notice, and the contract-holder(s) requirement to warn the other contract holders does not apply.
The joint contract-holder ceases to be a party to the contract on the withdrawal date, but the contract remains intact for all the remaining contract-holders (s.130(5)). Because the contract continues for the remaining contract holders, a renewal is not necessary after the withdrawal of a contract holder. Many landlords or agents may wish to provide a new contract for tidiness. If a new contract holder was being added at the same time as withdrawal, a new contract is recommended (see adding a contract holder for more detail).
Where a contract holder withdraws, the deposit protection scheme where the deposit is protected should be informed about the change. If a renewal is not done, the scheme's online portal can do this, and the deposit will continue to be protected under the same contract. However, if a renewal were being done, it would be advised first to unprotect the deposit and then reprotect it under the new contract holder(s).
If the withdrawing contract holder fails to leave on the date provided, it's unclear what enforcement is available. They might become a permitted occupier (because they cease to be a party to the contract on the withdrawal date). A person is a permitted occupier if they are not a lodger or sub-holder but is permitted by the contract-holder to live in the dwelling as a home (s.244(5)). It is unclear what the position would be if the contract-holder does not permit them to live in the dwelling!
There is an estate management ground (ground H) where the landlord can seek possession of the whole dwelling (not just against a single occupier) after one month's notice, but it's not likely to be used. A contract-holder must have given a withdrawal notice AND "the accommodation comprised in the dwelling is more extensive than is reasonably required by the remaining contract-holder (or contract-holders) ". You must give the notice within six months from when the joint contract-holder's rights and obligations under the contract ended (s.161(5)).
This is unlikely to be used because if the court makes an order for possession on an estate management ground (including ground H), the landlord must show suitable alternative accommodation is available. Also, the landlord must pay reasonable expenses likely to be incurred by the contract-holder in moving from the dwelling (s.160(3) & (4)). Furthermore, the claim is discretionary, and the court will only order possession if it is reasonable (s.160(3)).
It is worth noting that a tenant has always effectively had the right to withdraw under an AST. One tenant of several could give a notice to quit anytime during periodic. However, the problem was that this notice ended the entire tenancy for them all (Hammersmith & Fulham LBC v Monk 1992 1 All ER 1 HL), which put the landlord in the difficult position of having to treat the remaining occupiers as trespassers. The landlord couldn't demand rent, and possession needed to be sought unless the landlord gave a new tenancy to the remaining occupiers. The new rules fix this strange position and allow the occupation contract to continue even if one contract-holder wants to leave by notice.