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Housing (Scotland) Act 2010

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Part 5SRegulatory intervention

IntroductoryS

52Regulatory interventionS

Regulatory intervention may consist of any combination of the Regulator—

(a)requiring submission of a performance improvement plan (see section 55),

(b)serving an enforcement notice (see section 56),

(c)appointing, or requiring the appointment of, a manager (see sections 57 and 58),

(d)removing, suspending or appointing a registered social landlord's officers or agents (see sections 60 to 65),

(e)acting to protect a registered social landlord's assets (see sections 66 and 67).

Commencement Information

I1S. 52 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

53Exercise of regulatory intervention powersS

(1)This section applies where the Regulator is deciding—

(a)whether to make a regulatory intervention,

(b)which regulatory intervention to make, or

(c)how to make a regulatory intervention.

(2)The Regulator must consider—

(a)the desirability of social landlords being free to choose how to provide housing services and manage their financial and other affairs,

(b)the speed with which the failure or other problem needs to be dealt with, and

(c)its code of practice issued under section 54.

Commencement Information

I2S. 53 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

54Code of practice: regulatory interventionS

(1)The Regulator must issue a code of practice on regulatory interventions setting out how it intends to make decisions referred to in section 53(1).

(2)The code of practice may, in particular, set out examples of situations in which it may make a regulatory intervention.

(3)The code of practice must be kept under review and must be re-issued (with any revisions which the Regulator thinks appropriate) at least once every 5 years.

(4)Before issuing a code of practice, the Regulator must consult—

(a)Ministers,

(b)tenants of social landlords or their representatives,

(c)homeless persons or bodies representing the interests of homeless persons,

(d)recipients of housing services provided by social landlords or their representatives,

(e)social landlords or their representatives,

(f)secured creditors of registered social landlords or their representatives, and

(g)the Accounts Commission for Scotland.

(5)The Regulator must make arrangements for bringing the issued code of practice to the attention of social landlords.

Commencement Information

I3S. 54 in force at 1.4.2011 for specified purposes by S.S.I. 2011/96, art. 2, Sch.

I4S. 54 in force at 1.4.2012 in so far as not already in force by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

Remedial actionS

55Performance improvement plansS

(1)This section applies where the Regulator, having made inquiries or otherwise, considers—

(a)that a social landlord is, or is at risk of, failing—

(i)to achieve a standard or an outcome set out in the Scottish Social Housing Charter, or

(ii)to meet a performance improvement target,

(b)that––

(i)a registered social landlord is, or is at risk of, failing to meet a financial management or governance target, or

(ii)there has been misconduct or mismanagement in a registered social landlord's financial or other affairs, or

(c)that any other conduct by a social landlord justifies requiring it to submit and implement a performance improvement plan.

(2)The Regulator may require the social landlord to submit, by such time as the Regulator may specify, a performance improvement plan setting out how and by when the social landlord proposes to rectify or avoid the failure or other problem.

(3)The Regulator may require the social landlord to involve in such a way as the Regulator may specify, persons (or representatives of persons) who are or who may become—

(a)homeless,

(b)tenants of the social landlord, or

(c)recipients of housing services provided by the social landlord,

in preparing a performance improvement plan.

(4)The Regulator may require the social landlord to provide information on how it has involved such persons (or their representatives) in the preparation of a performance improvement plan.

(5)The Regulator may approve (with or without modifications or additional conditions) or reject a performance improvement plan submitted to it.

(6)The Regulator must not—

(a)approve a performance improvement plan submitted by a social landlord with modifications or additional conditions, or

(b)reject a performance improvement plan submitted by a social landlord,

unless it has given the social landlord notice of its intention to do so and has had regard to any views expressed by the social landlord within such period as the Regulator may specify.

(7)An approved performance improvement plan must be implemented by the social landlord concerned.

(8)The social landlord must—

(a)publish the approved performance improvement plan, and

(b)send a copy of it to any registered tenant organisation associated with the social landlord.

(9)Where a performance improvement plan is rejected, the social landlord must submit a revised plan to the Regulator by such time as the Regulator may specify.

Commencement Information

I5S. 55 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

56Enforcement noticesS

(1)The Regulator may serve an enforcement notice if, having made inquiries or otherwise, it considers—

(a)that a social landlord is, or is at risk of, failing—

(i)to achieve a standard or an outcome set out in the Scottish Social Housing Charter,

(ii)to meet a performance improvement target, or

(iii)to implement an approved performance improvement plan,

(b)that––

(i)a registered social landlord is, or is at risk of, failing to meet a financial management or governance target, or

(ii)there has been misconduct or mismanagement in a registered social landlord's financial or other affairs,

(c)that the interests of a social landlord's tenants need protection,

(d)that a registered social landlord's assets need protection,

(e)that a registered social landlord's financial viability is in jeopardy, or

(f)that any other conduct by a social landlord justifies serving an enforcement notice.

(2)An enforcement notice is a notice requiring the social landlord concerned to take action—

(a)to rectify or avoid a failure or other problem, or

(b)to protect its tenants or assets.

(3)An enforcement notice must—

(a)say why it has been served, and

(b)state by when the social landlord must take action.

(4)The Regulator must—

(a)publish an enforcement notice, and

(b)send a copy of it to every registered tenant organisation associated with the social landlord concerned.

Commencement Information

I6S. 56 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

Managerial appointmentS

57Appointment of manager for housing activitiesS

(1)This section applies where the Regulator, having made inquiries or otherwise, considers—

(a)that a social landlord [F1has failed, or is] failing—

(i)to achieve a standard or an outcome set out in the Scottish Social Housing Charter,

(ii)to meet a performance improvement target,

(iii)to implement an approved performance improvement plan, or

(iv)to comply with an enforcement notice, and

(b)that a person needs to be appointed in order to ensure that the social landlord provides housing services [F2in a way that will rectify the failure].

(2)The Regulator may appoint, or require the social landlord to appoint, a manager [F3to manage the landlord's housing activities generally, or such aspects of those activities as are necessary, for the purpose of rectifying the failure which the Regulator considers requires the appointment of the manager.]

(3)Before appointing or requiring appointment of a manager for a local authority or a local authority landlord, the Regulator must—

(a)consult—

(i)the local authority or local authority landlord,

(ii)such bodies representing local authorities as it thinks fits, and

(iii)the Accounts Commission for Scotland, and

(b)have regard to views expressed by those consulted by such time as the Regulator may specify.

Textual Amendments

F3Words in s. 57(2) substituted for s. 57(2)(a)(b) (8.3.2019) by Housing (Amendment) (Scotland) Act 2018 (asp 13), ss. 1(2)(b), 11(2); S.S.I. 2018/253, reg. 2(2)

Commencement Information

I7S. 57 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

58Appointment of manager for financial or other affairsS

[F4(1)This section applies where the Regulator, having made inquiries or otherwise, considers—

(a)that a registered social landlord has failed, or is failing, to comply with—

(i)a duty imposed by this Act or by any other enactment, or

(ii)a requirement imposed on the landlord by the Regulator under this Act or any other enactment, and

(b)that a person needs to be appointed in order to ensure that the landlord manages its financial or other affairs in a way that will rectify the failure.]

(2)The Regulator may appoint, or require the registered social landlord to appoint, a manager [F5to manage the landlord's financial or other affairs generally, or such aspects of those affairs as are necessary, for the purpose of rectifying the failure which the Regulator considers requires the appointment of the manager.]

Textual Amendments

Commencement Information

I8S. 58 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

59Appointment of manager: supplementaryS

(1)It is for the Regulator to determine the terms on which a manager is to be appointed under section 57 or 58 (including [F6, subject to subsection (1A),] as to period of appointment and remuneration and expenses).

[F7(1A)The appointment is to be only for so long as is necessary to rectify the failure which gave rise to the manager's appointment.]

(2)It is for the social landlord to pay the manager's remuneration and expenses.

(3)A manager has—

(a)general powers to do anything required to perform the manager's functions (including power to enter into agreements or do anything else which the social landlord has power to do), and

(b)such specific powers as the Regulator may specify.

[F8(4)The Regulator may give a manager directions about the rectification of the failure which gave rise to the manager's appointment.

(4A)The manager—

(a)must comply with such directions,

(b)may be removed by the Regulator on failure to so comply.]

(5)A manager acts as the social landlord's agent and is accordingly not personally liable on an agreement entered into as manager.

(6)Anyone dealing with a manager in good faith and for value need not inquire whether the manager is acting within the powers conferred by virtue of this section.

Registered social landlords: removal, suspension and appointment of officers etc.S

60General power to remove officersS

(1)The Regulator may remove an officer of a registered social landlord if the officer—

(a)is an undischarged bankrupt or is otherwise apparently insolvent,

(b)is subject to a disqualification order or a disqualification undertaking under the Company Directors Disqualification Act 1986 (c.46) or equivalent legislation in Northern Ireland,

(c)is disqualified from being a charity trustee under section 69 of the Charities and Trustee Investment (Scotland) Act 2005 (asp 10),

(d)is, because of a mental disorder, incapable of acting, or

[F9(e)is, because of absence or other failure to act, failing to ensure that the registered social landlord is complying with—

(i)a duty imposed by this Act or by any other enactment,

(ii)a requirement imposed on the landlord by the Regulator under this Act or any other enactment.]

(2)Before removing an officer, the Regulator must give at least 14 days' notice of its intention to do so to—

(a)the officer, and

(b)the registered social landlord.

(3)In this section “apparently insolvent[F10 is to be construed in accordance with section 16 of the Bankruptcy (Scotland) Act 2016].

Textual Amendments

Commencement Information

I10S. 60 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

61Suspension of officers etc. during or following inquiriesS

(1)The Regulator, when making or having made inquiries, may suspend a responsible individual (pending decision on removal or otherwise) where it considers—

[F11(a)that the registered social landlord has failed, or is failing, to comply with—

(i)a duty imposed by this Act or by any other enactment, or

(ii)a requirement imposed on the landlord by the Regulator under this Act or any other enactment,

relating to its housing activities or its financial or other affairs,]

(d)that the responsible individual—

(i)is, during a moratorium under section 75, obstructing the Regulator from performing its functions under Part 7, or

(ii)is not co-operating in accordance with section 84(2).

(2)The Regulator, unless it considers the case to be one of urgency, must give at least 14 days' notice of its intention to suspend a responsible individual to—

(a)the responsible individual, and

(b)the registered social landlord.

(3)A suspension ceases to have effect—

(a)if the Regulator removes the individual or lifts the suspension, or

(b)where the Regulator does not so act, on the day falling 6 months after the inquiries concerned are concluded.

(4)The Regulator may give the registered social landlord directions about—

(a)the performance of a suspended individual's functions,

(b)any other matter arising from the suspension,

and may appoint an individual, on such terms as it thinks fit, to perform the suspended individual's functions.

(5)It is an offence for a suspended individual to take any action in relation to the management or control of—

(a)the registered social landlord concerned, or

(b)any other registered social landlord,

without the Regulator's consent.

(6)An individual guilty of such an offence is liable on summary conviction to a fine not exceeding level 5 on the standard scale.

Textual Amendments

F11S. 61(1)(a) substituted for s. 61(1)(a)-(c) (8.3.2019) by Housing (Amendment) (Scotland) Act 2018 (asp 13), ss. 2(3), 11(2); S.S.I. 2018/253, reg. 2(2) (with reg. 4)

Commencement Information

I11S. 61 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

62Removal of officers etc. following inquiriesS

(1)The Regulator may remove a responsible individual where, having made inquiries, it considers—

[F12(a)that the registered social landlord has failed, or is failing, to comply with—

(i)a duty imposed by this Act or by any other enactment, or

(ii)a requirement imposed on the landlord by the Regulator under this Act or any other enactment,

relating to its housing activities or its financial or other affairs,]

(d)that the responsible individual—

(i)is, during a moratorium under section 75, obstructing the Regulator from performing its functions under Part 7, or

(ii)is not co-operating in accordance with section 84(2).

(2)Before removing a responsible individual, the Regulator must give at least 14 days' notice of its intention to do so to—

(a)the responsible individual, and

(b)the registered social landlord.

(3)It is an offence for a removed individual to take any action in relation to the management or control of—

(a)the registered social landlord concerned, or

(b)any other registered social landlord,

without the Regulator's consent.

(4)An individual guilty of such an offence is liable, on summary conviction, to—

(a)imprisonment for a term not exceeding 3 months,

(b)a fine not exceeding level 5 on the standard scale, or

(c)both.

Textual Amendments

F12S. 62(1)(a) substituted for s. 62(1)(a)-(c) (8.3.2019) by Housing (Amendment) (Scotland) Act 2018 (asp 13), ss. 2(4), 11(2); S.S.I. 2018/253, reg. 2(2) (with reg. 5)

Commencement Information

I12S. 62 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

63Responsible individualsS

“Responsible individual” (used in sections 61 and 62) means an officer or agent of a registered social landlord who appears to the Regulator—

(a)to have been responsible for,

(b)to have facilitated or otherwise contributed to, or

(c)to have been privy to,

the F13... failure or other problem concerned.

Textual Amendments

Commencement Information

I13S. 63 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

64Appeals against suspension or removalS

(1)An individual may appeal to the Court of Session against the Regulator's decision to—

(a)remove the individual under section 60 or 62, or

(b)suspend the individual under section 61.

(2)The Court may determine an appeal by—

(a)confirming the decision,

(b)quashing the decision,

(c)remitting the case to the Regulator for reconsideration,

and the Court's determination of the matter is final.

Commencement Information

I14S. 64 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

65Appointment of new officersS

(1)The Regulator may appoint an individual as an officer of a registered social landlord—

(a)in place of an officer it removes under section 60 or 62,

(b)where there are no officers,

(c)where—

(i)the registered social landlord has an insufficient number of officers to be able to appoint an officer under its constitution, and

(ii)the constitution does not provide a mechanism for appointing an officer in such circumstances, or

(d)if the Regulator considers that an additional officer is needed [F14to rectify a failure by the registered social landlord to comply with—

(i)a duty imposed by this Act or by any other enactment, or

(ii)a requirement imposed on the landlord by the Regulator under this Act or any other enactment,

relating to its] financial or other affairs.

(2)It is for the Regulator to determine the terms on which an officer is appointed (including [F15, subject to subsection (2A),] as to period of appointment and remuneration and expenses).

[F16(2A)Where the officer is appointed by virtue of subsection (1)(d) to rectify a failure to comply with a duty or requirement, the appointment is to be only for so long as is necessary to so rectify the failure.]

(3)The Regulator may require the registered social landlord to purchase and maintain personal indemnity insurance approved by the Regulator for the officer appointed.

personal indemnity insurance” means insurance designed to indemnify against liability attaching to an individual in connection with any negligence, default, or breach of duty committed in the individual's capacity as officer but does not include insurance with a provision—

(a)prohibited by section 68A(2) of the Charities and Trustee Investment (Scotland) Act 2005 (asp 10),

(b)prohibited by section 234(3) of the Companies Act 2006 (c.46), or

(c)which would be prohibited if the registered social landlord was a registered company or a charity.

(4)[F17Subject to subsection (4A), the] Regulator may renew the appointment of an officer on expiry of any period of appointment so determined.

[F18(4A)Where the officer was appointed by virtue of subsection (1)(d), subsection (2A) applies to the renewal of the appointment as it applies to the appointment.]

(5)It is for the registered social landlord to pay the appointed officer's remuneration and expenses.

(6)An appointed officer is entitled—

(a)to require a general meeting of the registered social landlord to be convened within 21 days of giving notice to the landlord's officers of a request to that effect,

(b)to attend, speak and vote at such a general meeting (whether or not convened in pursuance of paragraph (a)),

(c)to move a resolution at such a general meeting (whether or not so convened), and

(d)to resign or retire in accordance with the registered social landlord's constitution.

(7)An appointment may be made despite any contrary restriction in the registered social landlord's constitution (and any such restriction contrary to anything done by virtue of this section is accordingly overridden in relation to the appointment concerned).

Textual Amendments

Commencement Information

I15S. 65 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

Registered social landlords: asset protectionS

66Restrictions on dealings during or following inquiriesS

(1)This section applies if the Regulator, when making or having made inquiries, considers—

(a)that there has been misconduct or mismanagement in a registered social landlord's financial or other affairs,

(b)that the interests of a registered social landlord's tenants need protection,

(c)that a registered social landlord's assets need protection, or

(d)that a registered social landlord's financial viability is in jeopardy.

(2)The Regulator may—

(a)direct the registered social landlord not to—

(i)undertake particular transactions, or

(ii)make payments of a particular nature or amount,

without the Regulator's consent, or

(b)direct a bank or other person not to dispose of any money, securities or other assets it holds for the registered social landlord without the Regulator's consent.

(3)It is an offence for a person to fail to comply with a direction.

(4)A person guilty of such an offence is liable on summary conviction to—

(a)imprisonment for a term not exceeding 3 months,

(b)a fine not exceeding level 5 on the standard scale, or

(c)both.

Commencement Information

I16S. 66 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

67Transfer of assets following inquiriesS

(1)This section applies if the Regulator, having made inquiries, considers—

(a)that there has been misconduct or mismanagement in a registered social landlord's financial or other affairs, or

(b)that a registered social landlord's viability is in jeopardy for financial or governance reasons or because it cannot provide housing services to an acceptable standard.

(2)In either case the Regulator must also consider that a transfer of some or all of a registered social landlord's assets would improve the management of the assets.

(3)The Regulator may direct the registered social landlord to transfer some or all of its assets to another registered social landlord.

(4)The Regulator must—

(a)before making a direction, consult—

(i)the tenants of any houses it proposes to transfer, and

(ii)any secured creditor whom the Regulator knows to hold security over those houses, and

(b)when making a direction, have regard to any views expressed by those consulted by such time as the Regulator may specify.

[F19(4A)A duty on the Regulator to consult in accordance with paragraph (i) or (ii) of subsection (4)(a) does not apply where the Regulator considers that—

(a)the registered social landlord's viability is in jeopardy for financial reasons,

(b)a person could take a step in relation to the registered social landlord which would require to be notified to the Regulator under section 73,

(c)the direction would substantially reduce the likelihood of a person taking such a step, and

(d)there is insufficient time to comply with that duty and make a direction which would substantially reduce that likelihood.

(4B)The Regulator must—

(a)issue guidance on subsection (4A), such guidance to include—

(i)the circumstances in which it considers that subsection (4A) is likely to apply,

(ii)the actions it expects to take in those circumstances, and

(iii)how, in those circumstances, it intends to communicate with any of the persons mentioned in paragraph (b) who are affected by its actions, and

(b)before issuing or revising any guidance, consult—

(i)tenants of registered social landlords or their representatives,

(ii)registered social landlords or their representatives, and

(iii)secured creditors of registered social landlords or their representatives.

(4C)Where the Regulator proposes to direct a transfer of some (but not all) of a registered social landlord's assets, the Regulator must—

(a)before making a direction, obtain an independent valuation of those assets, and

(b)when making a direction, have regard to that valuation.]

(5)A transfer of assets under a direction must be made on terms specified in, or determined in accordance with, the direction.

(6)Those terms must however—

F20(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b)in the case of a transfer of all of a registered social landlord's assets, provide for the settlement or transfer of all the transferor's proper debts and liabilities in respect of the assets (whether secured or not).

(7)The Regulator may direct the transfer of assets from a registered social landlord which is a charity only if the recipient registered social landlord is a charity which the Regulator, after consulting the Office of the Scottish Charity Regulator, considers has the same or similar charitable purposes (within the meaning of section 7(2) of the Charities and Trustee Investment (Scotland) Act 2005 (asp 10)).

(8)The Regulator may direct the transfer of assets which the registered social landlord is under a duty to apply in accordance with section 19(1) of the Charities and Trustee Investment (Scotland) Act 2005 (asp 10) only if the Regulator—

(a)consults with the Office of the Scottish Charity Regulator, and

(b)after doing so, considers that the recipient registered social landlord will secure the proper application of those assets for the purposes which were set out in the transferor registered social landlord's entry in the Scottish Charity Register immediately before its removal from that register.

Textual Amendments

F19S. 67(4A)-(4C) inserted (20.11.2014 for specified purposes, 31.8.2015 in so far as not already in force) by Housing (Scotland) Act 2014 (asp 14), ss. 97(a), 104(3); S.S.I. 2014/264, art. 2, Sch.; S.S.I. 2015/272, art. 2, Sch.

F20S. 67(6)(a) repealed (20.11.2014 for specified purposes, 31.8.2015 in so far as not already in force) by Housing (Scotland) Act 2014 (asp 14), ss. 97(b), 104(3); S.S.I. 2014/264, art. 2, Sch.; S.S.I. 2015/272, art. 2, Sch.

Commencement Information

I17S. 67 in force at 1.4.2012 by S.S.I. 2012/39, art. 2, Sch. 1 (with Sch. 2)

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