Landlord and Tenant Flashcards
(99 cards)
What is the information required from a client to initiate a rent review/lease renewal (7)?
”- Agreed terms of engagement
- Understanding of client strategy
- Copy of lease, plans, deeds of variations, licences
- Copy of rent review memos
- Contact details of other party
- Existing file for the property
- Any comps details held on file”
What must you check before you take on a lease renewal/rent review instruction?
”- Whether you’re competent
- No personal interest or conflict
- Confirmation of complaints handling procedure
Agreed terms of engagement
“
How can fees for a rent reviews or lease renewals be structured?
”- Percentage of new rent agreed
- A percentage of the saving made form quoted rent
- Fixed fee
- Hourly rate”
What actions are required by a surveyor in a lease/rent review (14) (Time of essence or contracted out?) ?
“1. Undertake competency/conflict of interest check
2. Agree terms of engagement with client
3. Obtain understanding of client’s objectives
4. Obtain information req.
5. Read the lease pack.
6. Check lease is not contracted out (if doesn’t mention then it’s contracted in)
7. Check whether time is of essence for rent review
8. Undertake site inspection and measure in line with RICS Surveying Safely 2018 and RICS Property Measurement 2018
9. Undertake market rent valuation
10. Prepare report setting out recommendations
11. Agree strategy with client - who will serve notices? Solicitor to serve notice
12. Check notices are valid, open negotiations on instruction from client
13. Conclude negs and document rent in memo
14. For LR instruct solicitors to prepare new lease in accordance with HoTs”
What does Without prejudice mean?
”- During period of negotiations opposing party cannot rely upon document or discussions held which are labelled ‘Without Prejudice’ where representations made in litigation
- In rent reviews correspondence marked WP cannot be shown to arbitrator or independent expert “
What does Subject to contract mean?
Subject to contract
What is a licence?
”- Passes no interest in land but makes lawful what otherwise would be unlawful
- A personal right which can be terminated by either party “
What are the four requirements of a lease?
“1. Exclusive occupation
2. Payment of rent
3. Duration for a specified term
4. If more than 3 years then terms must be writing, signed and registered as a Deed”
What are 3 differences between a lease and a licence?
“1. A lease provides an occupier with an estate in the relevant land - licence is a permission to make it lawful for them to use the land
2. A lease can be assigned - a licence is normally a personal right that cannot be assigned
3. Exclusive possession
What case sets out differentiation between a lease and a licence?
Street v Mountford (1985) Mountford occupied two rooms subject to weekly rent. Court ruled it was a lease - Rent, exclusive possession and term certain
What is a tenancy at will?
- Form of licence created by written agreement for an unspecified time in which the landlord may evict the tenant at any time
What are the two uses for a tenancy at will?
“1. Allowing tenant early entry for fit out works
2. Tenant is agreeing a new contracted out of the 1954 Act Lease”
What is a Wayleave?
”- Temporary right for an annual payment eg electricity company keeping their kit in on someone elses property
- Personal to the company and cannot be transferred
- It is not compulsorily registrable
“
What is an Easement?
”- Permanent right and receives a capital payment
- Capable of being registered at the land reg
- Allows a right enjoyed by one party over the land of another
- Prescriptive RoW or Easement can be obtained by continous or uninterupted use being proven over period of not less than 20 years”
What is adverse possession?
“Process by which a person who is not the legal owner of the land can become the legal owner through possession of the land for a specificed time without the owner’s permission
- Pre Land Registration Act 2003 12 years of possession
- Post then 10 years
- Land not registered then 12 years”
What are the four usual assumptions to a rent review?
“1. Property to let on open market by willing tenant and a willing landlordfor a term of years a stated
2. Property is fit and avilable for immediate occupation and use
3. All covenants observed by landlord and tenant
4. Property may be used for purpose set out in lease”
What are the 3 usual disregards?
“1. Any effect of goodwill on tenant’s occupation
2. Ignore goodwill attached to the property
3. Tenants improvements if landlord consent has been granted for the works”
What is the case linked to Time is of the Essence?
United Scientific Holdings Ltd v Burnley Borough Council 1977 and Bello v Ideal View 2006 - Court determined that a rent review was valid even after 13 years
What should you do if the lease is silent on hypothetical/notional term?
“Assume the residue of the term
Basingstoke and Deane Borough Council v Host Group 1987”
What is a deeming provision?
”- RR in older leases require a landlord to specify the rent in a trigger notice
- If tenant does not serve appropriate counter notice then tenant will have been deemed to accept the new rent”
What is the courts take on post dated evidence?
Courts hold that it is admissable provided it supports circumstances which could have been known about at the time of the review
What is the hierachy of evidence?
“1. Open market lettings
2. Rent reviews and lease renewals
3. Independent expert determinations
4. Arbitrator determinations
5. Court determinations under L&T Act 1954
6. Hearsay evidence
7. Sale and leasebacks
8. Surrender and renewals
9. Inter company arrangements”
What is a Calderbank letter and what’s its purpose?
”- Can achieve early resolution of a dispute and prevent costs escalating
- Must be served on a letter ‘Without Prejudice and Save as to Costs’
- In rent reviews losing party would have to pay all the costs
- Letter must set out all the terms to settle the dispute and the time limit for the other party to accept the offer - often 21 days
- Must be genuine offer to settle
- Arbitrator is obliged to make award for costs
- Lease renewals (Under Part 36 of the Civil Procedures Rules, 1998) - must be made in writing and remain open for acceptance for a min of 21 days”
What guidance note offers guidance on acting as an arbitrator?
RICS Guidance Note ‘Surveyors acting as arbitrators in commercial property rent reviews’ 2013