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RICS APC > Landlord & Tenant > Flashcards

Landlord & Tenant Flashcards

(100 cards)

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1
Q

What information is required at the beginning of an instruction?

A

Terms of engagement
Client’s objectives
Lease, licences, rent review memos
Plans
Comparable evidence from Client

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2
Q

What do terms of engagement need to be?

A

In writing

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3
Q

What could the fee basis be for a rent review/lease renewal instruction?

A

Fixed fee
% of uplift agreed
Hourly rate

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4
Q

What actions are required by a Surveyor at the outset of an instruction?

A

Check Conflict of interests
Agree ToE
Inspect & Measure
RTL
Obtain info from Client

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5
Q

What does ‘without prejudice’ mean?

A

Privileged information. Cannot be used as evidence in legal proceedings.

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6
Q

What does ‘subject to contract’ mean?

A

The information is not intended to form a contract.

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7
Q

What are the main differences between a lease and a licence?

A

Street v Mountford
Lease can be assigned, licence is personal
Licence can usually be terminated at any time, lease only if break option/expiry
Licence - right to do something, lease = exclusive possession.

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8
Q

What are the features of a licence?

A

Right to do something that would otherwise be unlawful
Does not create an estate in the land
Personal

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9
Q

What are the features of a lease?

A

Exclusive possession
Fixed term
Rent payable
If for more than 3 years, must be in writing

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10
Q

What is a Tenancy at Will?

A

Form of licence that either party can terminate, giving no notice.

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11
Q

What is a wayleave?

A

A personal, temporary right for someone to access another’s land to maintain equipment (think utility company)

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12
Q

What is an easement?

A

A permanent right, noted on the title for someone to repair & maintain their equipment on someone else’s land.

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13
Q

What is adverse possession?

A

When the non-legal owner of land/property, becomes the legal owner through using it for 12 years or longer

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14
Q

What are the typical rent review assumptions?

A

The property is available for immediate occupation
The property is let on the open market between a willing landlord and willing tenant for the hypothetical term
The property is to be used for the purpose noted in the lease
Both parties have performed their covenants.

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15
Q

What are the usual rent review disregards?

A

Any goodwill attached to the tenants occupation
Any goodwill attached to the property
Any tenant alterations, if approved by the Landlord

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16
Q

What is the notional term?

A

The length of the term to be valued. If the lease is silent, assume residue of the term.

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17
Q

What is a headline rent review clause?

A

When any incentives granted are not considered when deciding the new ret. Typically no longer accepted.

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18
Q

What are deeming provisions?

A

When the landlord is to state the new rent in the notice, and if the tenant does not respond in a certain timeframe, they are deemed to accept the new rent.

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19
Q

Can a rent review be exercised 13 years after the rent review date, if time is not of the essence?

A

Yes, as this was the case in Ideal View v Bello

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20
Q

How do you instigate third party determination in a rent review?

A

RTL
Arbitrator/expert can be appointed through RICS President - cost £425

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21
Q

What are the differences between an Independent Expert and Arbitrator?

A

Arbitrator - governed by Arbitration Act 1969, I.E governed by lease
I.E can obtain their own evidence, Arbitrator must rely on the evidence provided by the parties
I.E can be sued for negligence
Arbitrator = award, I.E = determination

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22
Q

What is time of the essence?

A

A right within the lease that is to be exercised in a certain timeframe. If not exercised in that timeframe, right is lost.

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23
Q

What is a Calderbank?

A

Genuine offer to settle prior to court proceedings. Marked ‘without prejudice, save as to costs’

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24
Q

What is the RICS guidance on arbitration?

A

RICS Guidance Note ‘Surveyors Acting as Arbitrators in Commercial Property Rent Reviews’ 2013

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25
What is the RICS guidance on Independent Expert determination?
RICS guidance note 'Independent Expert Determination' 2016
26
Can an arbitrators decision be appealed?
Yes, to the high court within 28 days. On following grounds - - Serious irregularity - Point of law - query to the tribunals jurisdiction
27
What is disclosure?
When one party can request to see the other party's rental evidence.
28
In a falling market, when acting for the landlord, is it better to have an I.E or arbitrator to act?
In falling market = arbitrator preferable for Landlord. In rising market = I.E preferable for Landlord. Vice versa for tenant.
29
What is expert witness?
The evidence provided to an arbitrator / independent expert.
30
What RICS guidance covers expert witness?
RICS Professional Standard 'Surveyors Acting as Expert Witnesses' 2014
31
What is an advocate?
Someone who represents their client in court / at a hearing. Duty to client, may only disclose what they wish to.
32
What is the RICS guidance surrounding advocates?
RICS Professional Standard 'Surveyors Acting as Advocates' 2017
33
What does expert witness need to be?
- Work of the independent surveyor - Duty to the court - Facts relied upon must be believed to be true - Impartial & objective
34
What is included in a rent review memorandum?
- Name & address of both parties - Date of lease, and review - Confirmation of rent agreed - Address of property - Signed and dated by both parties
35
Under S23 of the LTA 1954, what constitutes a business tenancy?
- A tenancy - Business use - More than 6 months - Occupy at least part of premises - Must have a competent Landlord - Must not be an excluded tenancy
36
What does S24 of the LTA 1954 cover?
Holding over provisions; a lease inside the Act does not expire by effluxion of time.
37
What does S25 of the LTA 1954 cover?
Landlord's ability to propose/oppose a lease renewal
38
What must a S25 notice be?
Served by the competent Landlord In the prescribed form Served 6-12 months before lease end Max. 15 years can be granted
39
What is included in a S25 notice?
- Name & address of both parties - Address of property - Confirmation of hostile or friendly - If friendly, terms for new lease - If hostile, ground for opposition - Recommendation to seek professional advice
40
What is a S26 notice?
A notice served by the tenant to propose a new lease
41
What must a S26 notice include?
Proposed terms for a new lease Lease must commence no sooner that 6 months and no later than 12 months after notice
42
What is a S27 notice?
Notice by the tenant to end the tenancy. Must be served 3 months before the proposed end date. Used when holding over.
43
What are the Landlord's grounds for opposing a new lease under S30 of the LTA 1954?
A) Breach of repair covenant B) Persistent delay in paying rent C) Breach of any other covenant D) LL offers alternative accommodation E) Uneconomic sub-division F) Redevelopment G) Owner-occupation
44
Under S37 of the LTA 1954, which grounds can a tenant claim compensation for, and what compensation is payable?
Grounds E - G If in occupation for less than 14 yrs, 1 x RV If in occupation for more than 14 yrs, 2 x RV
45
Which grounds are mandatory and discretionary?
Discretionary - A-E Mandatory - F & G
46
To be successful when obtaining possession on Ground G, what must the landlord do?
Prove that they owned the property for 5 years min. and have an intention to occupy the property w/ their business.
47
What section of the LTA 1954 covers compensation?
S37
48
Name 2 cases relating to occupation under S30 of LTA 1954?
Frances v Cavendish Hotel Betty's Cafe v Philips
49
What is the leading case that covers modernisation of lease renewals?
O'May v London Real Property Co
50
What are the 4 principles tests to establish if changes can be made to the renewal lease?
- Must be reasonable - Must be for valid estate management reasons - Must be able to be compensated in the rent - Must not impact security of tenure
51
When establishing the market rent under LTA 1954 Act, what are the assumptions and disregards?
Assumptions: - Willing LL & willing T - Let with VP - Regard to terms of tenancy - Impact of L & T Covenants Act 1995 Disregards: - Goodwill attached to tenant business - Alterations if undertaken more than 21 yrs ago - Impact of rent due to licensing - Affects of T's occupation
52
Which section of the LTA 1954 covers Interim rents?
S24A
53
What is an interim rent? Who can apply for it and when?
Rent payable between the end of tenancy and commencement of new tenancy. Either LL or T can apply, earliest date = date of notice, latest date = 6 mnths
54
What is S40 of the LTA 1954?
Either party can serve notice to find out who the competent LL is (can be LL or superior tenant) and that is the party who the notices need to be served on.
55
What are the options for determination for rent reviews?
RTL - either arbitration or independent expert Calderbank
56
What are the options for determination for lease renewals?
County Court - Part 36 offer PACT
57
What is the difference between a Part 36 offer and a Calderbank?
Part 36 - Governed by strict procedural rules, Calderbank is more informal
58
What does S38A of the LTA 1954 cover?
Contracting out provisions
59
Why would a LL wish to contract a lease outside of the Act?
Owner occupation at lease end Possibility to redevelop Flexibility and control
60
What does it mean when a lease is contracted out of S32 - S35 of the LTA 1954?
Tenant has no right to remain in occupation at the lease end or claim compensation Via a stat or simple declaration
61
Name the different ways to bring a lease to an end?
Forfeiture Surrender Lease expiry Lease disclaimed Break option
62
What is a protected tenancy?
Tenancy made under the Rent Act 1977 - tenant gets rights of security and to a fair rent
63
What is a periodic tenancy?
A tenancy that has no fixed end date, and can only be ended by wither party serving notice.
64
What is a tenancy at sufferance?
When a tenant wrongfully stays in occupation beyond the lease expiry.
65
What is forfeiture?
When the Landlord brings the lease to an end due to a breach of covenant by the tenant
66
What is a S146 notice?
A notice that the Landlord can serve on the tenant for a breach of covenant - Law of Property Act 1925. Can give the tenant the option to remediate the breach.
67
Can a tenant be compensated for improvements they have undertaken?
Yes, under the L7A 1927 but they must have served a notice on the LL with all plans, specifications.
68
What is the difference between a guarantor and a surety?
Guarantor - independent agreement Surety - contract between a principal debtor, creditor and third party that binds them on behalf of the debtor
69
What is an AGA?
An authorised Guarentee Agreement - outgoing tenant (assignor) guarentees the performance of the assignee
70
What is the Party Wall Act?
Aims to protect parties' rights where there are shared boundaries - protect their individual properties Helps to ensure parties can undertake works, and all parties are notified
71
What is the purpose of the Access of Neighbouring Land Act 1992?
Allows access to neighbouring land for a specific purpose ie to repair guttering, tree work etc. (upon notice)
72
What are the implied landlord & tenant covenants?
Tenant = to pay rent & keep property is good repair Landlord = to provide quiet enjoyment
73
What are implied covenants?
Contractual obligations not specifically stated in the lease
74
What is quiet enjoyment?
A tenant's right to undisturbed possession and use, free from interference
75
What legislation states that leases of more than 3 years should be in writing?
Law of Property (Miscellaneous Provisions) Act 1989
76
Which legislation covers that Landlords must provide consent to applications in a reasonable timeframe?
LTA 1988
77
What is the right of pre-emption?
Right to be offered the chance to buy land or property before it is offered to another party.
78
What is the difference between an assignment and a sub-letting?
Assignment - disposal of whole lease Sub-letting - lease under head lease
79
What are the 3 types of dilapidations schedule?
Terminal - during last 2 years of term Final - after lease has ended Interim - during term
80
Tell me about your understanding of the Code for Leasing Business Premises.
Code produced by British Property Federation to assist negotiations. Importance on HoTs, collaborative negotiations for mutual benefit and to provide info to unrepresented parties
81
What is alienation?
A tenant's ability to transfer their leasehold interest to another party, often through assignment or subletting
82
What is the difference between in and out of court PACT?
In court - involves a court order Out of court - voluntary agreement
83
What does Section 34 relate to in a lease renewal?
Gives the court the power to determine the level of rent when the parties have not been able to reach an agreement on that aspect of a renewal lease
84
What is RPI?
Retail Prices Index, change in prices of goods
85
What is a cap and collar rent review?
Sets a max increase (cap) and max decrease (collar) for rent reviews
86
Can you challenge the determination of an independent expert?
Yes, on limited grounds - - Clear error by the expert - Bias - Fraud / Collusion
87
What is the presumption of reality?
It is derived from the proposition that the commercial purpose of a rent review clause is to update the original rent to take account of changes in market conditions and the value of money during the course of the term.
88
What is turnover rent?
The rent is based on the tenant's turnover
89
What is a geared rent?
Rent that is linked to the rent obtained or obtainable by the tenant from its undertenants
90
What RICS document is there about comparable evidence?
Professional Standard 'Comparable Evidence in Real Estate Valuation'
91
How can you settle a dilapidations claim?
Part 36 offer Offer to settle Tenant undertakes work
92
What is supersession?
When a landlord's wish to alter/redevelop, supersedes a tenants repair obligation. Dilapidations = for landlord loss only, not for profit.
93
Explain the LTA 1954, LTA 1927 and LTA 1988?
LTA 1988 - the grant of consent to dealings with leased property LTA 1954 -Security of tenure LTA 1927 - allows a tenant of certain holdings to serve notice stating its intention to carry out specified improvements
94
What is PDPAC?
Pre-action conduct
95
What is post-dated rent review evidence? Can it be used?
Evidence dated after the rent review. Yes, but there is less weight placed on it.
96
What are the timings in dilapidations protocol?
Landlord should serve the schedule no later than 56 days.
97
At Royal Buildings, tell me about the rent review clause?
Time was not of the essence Upwards only, open market Either arbitrator or expert
98
At Royal Buildings, tell me about the rents involved, and settlement reached?
Passing rent - £20,000 (£28.49 ITZA) Market rent - £21,000 (£30 ITZA) Very straight forward property - zoned into 3 sections (20 x 20 per section)
99
If no agreement reached, what could you have suggested to your Client?
Calderbank Re-gear
100
Can you explain any cases on rent suspension clauses (due to Covid)?
Poundland v Toplain Judge held a 50% rent reduction in any future restrictions was unreasonable, as the LL should not be made to share the burden, when it is not their fault.

RICS APC (23 decks)

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