Landlord and Tenant Flashcards
(115 cards)
Basic difference between lease renewal and rent review?
Lease Renewal: A statutory process under the Landlord & Tenant Act 1954.
Rent Review: A contractual process contained within a lease.
Contracted Out Lease? No statutory renewal rights!
To what tenancies does the 1954 Act apply?
Tenancies occupied for business purposes
When was the LL&T Act 1954 last amended?
1st June 2004
Name the tenancies to which the 1954 Act does not apply
Agricultural holdings
Mining leases
Residential tenancies
Tenancies granted as a condition of employment
Short tenancies (≤6 months) (Unless extendable or occupied >12 months)
Tell me about your understanding of the Landlord and Tenant (Covenants) Act 1954
An act that provides business tenancies with security of tenure
What is a s25 notice?
Landlord notice to terminate or renew a lease at expiry.
Cannot terminate before expiry date.
Can offer a new lease (friendly) or oppose renewal (hostile, under s30).
When can a LL serve a s25 notice?
Between 6-12 months before lease expiry.
Notice must be at least 6 months.
What must a LL s25 notice contain?
If L does not oppose a new tenancy (sometimes referred to as a friendly notice) the Notice must state:
- Name and address of landlord and tenant
➢ the property comprised
➢ the rent
➢ the other terms
A health warning would explain to T
➢ that Ls proposals are for the purposes of negotiation
If landlord opposes new tenancy:
The ground(s) under section 30(1) upon which he would opposed the tenants application for a new tenancy
What advice would you give a LL in respect of a lease renewal where a property is significantly over rented
Option 1: Do nothing, keep rent, tenant holds over (risk: T can leave with 3 months’ notice).
Option 2: Serve s25 notice & agree a new lease at lower rent (lower rent = higher property value).
Key risk: Tenant may apply to court for rent adjustment.
When is the best time to serve the s25 notice: 12months or 6months before lease expiry?
12 months before: More time, tenant decides sooner.
6 months before: Rent negotiations closer to market conditions.
Risk of waiting: Tenant may delay response & leave last minute.
Why would a LL give 12 months’ notice when he could give 6 months?
If over-rented, get 6 extra months at higher rent.
More time to re-let if tenant is likely to leave.
What action should LL take if require possession of a property at end of lease?
Serve s25 notice & object to renewal under s30 grounds.
What can a LL do if cannot get response from T to friendly s25 notice?
LL can write demanding a response within 14 days.
If no reply, LL can apply to court (T liable for costs).
Court likely to push for mediation.
Advice to a Tenant if s25 Notice Expires in 2 Weeks & No Lease Agreed
Ask LL for a time extension to apply to court.
LL does not have to agree.
If no extension, T must apply to court for a new lease.
If s25 expires & no action taken → Tenant loses security of tenure.
s30(1) Grounds for LL to Obtain Possession
1️⃣ T failed to repair
2️⃣ T persistently delayed rent payments
3️⃣ T breached another covenant
4️⃣ LL offers suitable alternative accommodation
5️⃣ LL can get higher rent by letting whole building instead of sub-tenancies
6️⃣ LL intends to demolish or redevelop
7️⃣ LL intends to occupy (must have owned for 5+ years)
(Last 3 are “no-fault” grounds, triggering tenant compensation.)
Steps to Negotiate a Shop Lease Renewal (12 months left)
In the following order
Need copy of lease
agree terms of engagement - only act for client after that
Inspect the property to a) measure, b) carry out rental valuation, c) see if there any breaches of tenants covenants (EG unauthorised alterations, breach of user, unathorised sub-let to another tenant, failure to repair)
then serve s25 notice and state the tenant can stay
When Does T Get Compensation if LL Opposes Lease Renewal?
💰 Only if LL relies solely on no-fault grounds (e, f, or g).
💰 If combined with other grounds (a, b, or c) → No compensation!
How is Tenant Compensation Assessed?
🏢 Occupation <14 years: 1x Rateable Value
🏢 Occupation ≥14 years: 2x Rateable Value
What can a court decide on in a lease renewal, what are their powers?
🏛 Court can decide:
s32: Property included in lease
s33: Term
s34: Rent
s35: Other terms
s24a: Interim rent
What do you understand s34 rent to be?
S34 - rent disregarding the tenants previous occupation, any good will, certain improvements and any licence to sell intoxicating liquor if the licence belongs to the tenant
How is Interim Rent Assessed?
The determined market rent from the start of the interim period.
How is Interim Rent Assessed?
📆 Based on market rent at the start of the interim period.
📑 Default: Same rent as new lease unless reasons to vary.
📝 On the old lease terms.
What circumstances should a T Serve a s26 Notice?
📉 If current rent is above market → Secure new lease at lower rent.
📜 Even if rent rises, ensures T has a lease (avoiding relocation risks).
When Are Tenant’s Improvements Disregarded at Lease Renewal?
🔧 If done within last 21 years or during old lease
🔧 Improvements must add value (not just any alteration)
🔧 NOT disregarded if it was a lease obligation