Head 17:6 Flashcards
(22 cards)
What is irritancy?
This is the right of the landlord to bring a lease to an end prematurely for reason implied by law (“legal irritancy”) or under the express terms of the lease.
What is legal irritancy?
Non-payment of rent for 2 years (or 6 months for agricultural tenants) THIS IS IMPLIED BY LAW BUT ALMOST NEVER USED BECAUSE 2 YEARS IS VERY LONG
[The tenant may prevent the irritancy up until the extract decree is obtained by paying (even at the very last moment.)]
What is conventional irritancy?
This is is far more important than legal irritancy and is stipulated expressly in the lease.
Example trigger events in commercial lease irritancy clauses:
Non payment of rent for 21 days
Failure to fulfil any other obligation under lease
Tenants going into liquidation or having receiver appointed
Tenants having administration order made against them
Tenants becoming apparently insolvent or signing trust deed for their creditors.
Under conventional irritancy what happens if the tenant pays the rent after irritancy proceedings have begun. If the landlord accepts this, is he bound to have waived the breach which gives rise to the irritancy?
The rule seems to be that if the landlord makes it clear that the breach has not been waived but that the tenant can stay on temporarily and make rent payments then the landlord can still irritate.
On the other hand, consistent acceptance of rent with no qualifying explanation can amount to acquiescence and the landlord may be barred from irritating.
HMV Fields Properties Ltd v Bracken Self Selection Fabrics Ltd 1991
The landlord served a notice of irritancy for various trigger events listed in the lease and the matter went to arbitration. The tenant stayed on meanwhile and was paying rent. The landlord returned the payments except for two which they delayed returning. The court held it was a question of fact whether the tenant’s breach had been waived - the arbiter held that there had been no waiver and the court agreed. Thus the landlord was permitted to continue irritating.
Aubrey Investments v Crawford 1998
Landlord had a right to irritate upon the receivership of the tenant. When this occurred, the landlord didn’t irritate immediately but rather entered into negotiations with the receivers on the possibility of the tenant assigning the lease. In the meantime the landlord still collected the rent. Negotiations on the assignation broke down and the landlord purported to irritate. It was held the landlord’s had not waived the right to irritate (they had only accepted the rent as a precondition of negotiating the assignation.
Dollar Land (Cumbernauld) Ltd v CIN Properties Ltd 1998
There had been an irritancy. It was held the landlords could keep windfall benefits from improvement of the property following conventional irritancy - it was held they were not unjustifiably enriched.
Under the common law you could not purge a conventional irritancy - the landlord had an absolute right to irritate. However, under the Law Reform (Misc Provisions) (S) Act 1985 ss 4-7 there is now a difference between monetary breaches and non-monetary breaches.
For monetary breaches a 14 day notice must be given.
For non-monetary breaches there is a “fair and reasonable” landlord test.
Whitbread Group v Goldapple 2005
Rental payment tendered by tenant’s agent by cheque suspends the landlord’s right to irritate
LOOK THIS UP
Aubrey Investments v DCS 2000
This is an example of the “fair and reasonable” landlord test being examined - it really is a matter of the facts of the case.
In relation to non-monetary breaches, when is the “fair and reasonable” landlord test applied?
The “fair and reasonable” landlord test is applied at the time of termination of the lease and not during the previous part of the lease (Maris v Banchory Squash Racquets Club [2007])
If the tenant fails to leave the property at the ish then…
The landlord can remove them using a common law “action of removing”.
If the landlord uses the common law “action of removing” but the tenant stays put, the landlord can obtain…
Compensation known as “violent profits” (this is usually double rent)
Jute Industries v Wilson and Graham 1955
The tenants remained for two months over the ish / notice to quit and were held liable to pay double rent for the two months.
What is alienation?
What are the two main ways of alienating?
This is transferring ones interest / disposal of a leasehold interest, normally but the tenant.
There are two main ways to do so: assignation (tenant 1 disappears) or subletting (tenant 1 sublets to tenant 2)
Can a lease by assigned / sublet?
The starting point is whether the lease expressly permits or precludes it.
There are rules concerning delectus personae if the lease is of a special nature.
[In relation to whether leases can be assigned / sublet.]
Delectus personae is presumed in…
Agricultural leases of ordinary duration (not fixed, probably 20 years or less) and furnished house lets - this means they cannot be assigned.
[In relation to whether leases can be assigned / sublet.]
Delectus personae is NOT presumed in…
Agricultural leases of extraordinary duration (probably 20 years or above) or unfurnished urban lettings - this means in these instances the common law allows assignation.
Can the landlord alienate his / her interest (i.e. by sale) without the tenant’s permission?
In general yes.
On assignation of a lease what happens to past and future obligations?
The previous tenant’s future obligations come to an end (obligations already incurred pass to the assignee). In the case of past obligations of arrears of rent the original tent probably remains liable but the assignee can also be sued.
How does an assignee of a lease actually obtain a real right?
It would seem that all that is needed for a short lease is possession (the new tenant moving in) and for a long lease registration.
In other words it would seem that intimation to the landlord is not crucial.
