Landlord and Tenant

Question 1

1. What is the the main thing to be conscious of if the lease is outside the act?

Answer 1

a. If they continue to pay rent and the rent is accepted it could grant the security of tenure. Therefore I would need to put a tenancy at will in place if the client is happy for them to continue occupation whilst lease renewal negotiations continue.

Question 2

2. What is the latest RPI figure?

Answer 2

a. Aug - 376.6

Question 3

3. Why didn’t you document RPI’s during covid?

Answer 3

a. The property came into our management at the end of 2020 in the middle of the lockdowns. At the time we were busy setting up our systems, TS billings etc and therefore focus, as per the clients instruction was to get this done before reviewing rent reviews. Once this had been done it was clear some RPI’s had not been put in place from 2018 – 2019 therefore I carried out the exercise to compare the RPI increases for each year and then the RPI increase missing the years in between. I presented this to the client and considering these tenants are independent tenants, whilst we could implement these RPI’s it would show good will to write missed years off and increase from 2022.

Question 4

4. How do you document the RPI rent review?

Answer 4

a. Rent review memorandum

Question 5

5. What is included within a rent review memorandum?

Answer 5

The date
Premises
Lease
Landlord
Tenant
Reviewed in accordance to the lease
Agreed rent
Payable from rent review date
Signatures

Question 6

6. What is the difference between a lease and a licence?

Answer 6

a. A lease is exclusive occupation of premises whereas a licence provides the right to use it and has no right interest in the property.
b. A lease can be assigned a licence cannot
c. Do not give security of tenure
d. A lease cannot be terminated at any time whereas a licence can

Question 7

7. What an effective FRI?

Answer 7

a. It is an FRI where the landlord carries out the external repairs and bills on their behalf through the service charge.

Question 8

8. What is a CVA?

Answer 8

a. It is a contract between a company and its creditors where the directors believe is has a viable future.

Question 9

9. What percentage of creditors have to approve a CVA?

Answer 9

a. 75% of creditors

Question 10

10. What does it mean to be opted out of the act?

Answer 10

a. You would not have security of tenure. Therefore when you come to the end of the lease you do not have the right to be granted a new lease

Question 11

11. Why would a landlord want a tenant to be opted out?

Answer 11

a. To provide flexibility

Question 12

12. What are the section 30 grounds?

Answer 12

a. Opposition grounds that the landlord can use as a reason to not grant a new lease
i. Breach of repair clause
ii. Non-payment of rent
iii. Demolition
iv. Re-locate the tenant
v. Any other breach in the lease
vi. LL occupation
vii. If the tenant is part occupying and it is more economical to lease the whole over the part.

Question 13

13. What is an easement?

Answer 13

a. Provides a permanent right by one party on the land of another

Question 14

14. What is a wayleave?

Answer 14

a. This provides a temporary right to access the area in question. For example to install cables.

Question 15

15. What is time of the essence?

Answer 15

a. Carry out within a certain period
b. Case law
i. United Scientific holdings vs Burnley council
ii. Bello v Ideal View

Question 16

16. What are the different types of rent reviews?

Answer 16

a. RPI
b. CPI
c. Set increases
d. Open market up wards only
e. Open market upwards and downwards

Question 16

17. Talk me through how you carried out the RPI rent review?

Answer 16

a. I firstly ascertained which tenants had outstanding rent reviews
b. I then created a schedule for each tenant and listed the years outstanding
c. I reviewed each lease and made notes of the important RPI months and the calculation to be done for each one.
d. I then obtained the RPI figures from the Office for National Statistics (as per the lease)
e. I then used these figures with the rents to calculate each rent review.
f. Once done I presented this to the client and advised the client of the effective write off amount should the lockdown years be written off and what the new rent would be should these years be missed.

Question 17

5. What are the L&T 54 act sections 24-28

Answer 17

a. Section 24 – lease only expires by serving a notice.
i. No notice = holding over
b. Section 25 – LL notice to end or renew must be served
i. By competent LL
ii. Relate to whole of property
iii. Date of termination
iv. Inform tenant of rights
v. Proposed terms
vi. Max term 15 years
vii. Opposition if rejecting new lease
c. Section 26 – T lease renewal
i. In prescribed form
ii. Tenants proposal
d. Section 27 – T end lease
i. If T moves out before expiry no notice required because the business is not running a business there and therefore does not apply but the lease remains in force 3 month notice.
e. Section 28 – Renewal of tenancy by agreement

Question 18

4. What is an example of a lease query you have assisted with

Answer 18

a. Vision Express rent free following not serving break
b. Rent does not start until the Qtr day following the break date

Question 19

3. What is the structure of leases

Answer 19

a. Lease date
b. Parties
c. Unit
d. Particulars
i. Term
ii. Rent
iii. SC
e. T covenants
f. Repairs
g. Alienation
h. LL covenants
i. Break
j. Schedules