Matt - Landlord and Tenant Flashcards
(41 cards)
What is a lease?
A lease is a contract between two or more parties that creates a legal interest (a leasehold) in land and buildings
What contents need to be present for there to be a lease?
- Be for a certain term i.e. a fixed period of time
- Grant exclusive occupation of a property
- Be at a rent
- Statute in the form of a deed
What are the two legal interests when agreeing on a lease?
- The freehold reversion for the Landlord
- The leasehold for the Tenant
What is a covenant within a lease?
A key feature of a lease
What are some examples of covenants within a lease?
- Demise - the property that is to be let
- Parties - details who the landlord, the tenant and any guarantor/surety is
- Lease term - how long the lease is to be granted for
- Rent - the commencing rent and when it starts
- Rent review clause - a complex area that sets out the nature, basis and frequency of any review of the rent during the lease term
- Repairing liability - sets out who is responsible for the repair of the property during the lease term
- User clause - how the property is to be used by the tenant during the lease term
- Alienation - governs the ability of the tenant to grant a sub-lease of all of their leasehold interest (subletting) or sell in its entirety (assignment).
What is a rent review?
It is an agreed lease event that allows the parties to reconsider the rent paid
What does it mean by an upwards only rent review?
This means that the rent can never go down during the life of the lease, it is only reviewed in an upward direction.
What should you consider when acting for a Landlord or Tenant when it comes to a rent review?
Time is of the essence! If in doubt then contact a legal advisor to assist with serving a notice.
What should you consider before starting the rent review process?
- What is the mechanism for activating the rent review?
- What is the basis and method for determining the reviewed rent?
- What is the method of dispute resolution provided within the lease in the event the parties can’t agree on the matter?
What are the different mechanisms for reviewing a rent?
- Review it to market rent
- Linked to an indexation factor e.g. RPI or CPI
- Fixed stepped increases
- Percentages of turnover of the tenants sales/business
What is the primary legislation related to Landlord & Tenant?
Landlord & Tenant Act 1954
Does the Landlord & Tenant Act 1954 apply to all tenancies or business occupations?
No
What are some examples of tenancies that may not be protected by the Landlord & Tenant Act 1954?
- The lease is not a business tenancy
- The tenancy is a tenancy at will
- The tenancy is an exempt tenancy e.g. mining or agricultural
- The lease is a service tenancy
- The lease is contracted out of the security of tenure provisions within sections 24-28 of the Landlord & Tenant Act 1954
How many parts does the Landlord & Tenant Act 1954 consist of?
4
Which part of the Landlord & Tenant Act 1954 relates to the security of tenure of business tenancies?
Part 2
What does Section 23 of the Landlord & Tenant Act 1954 detail?
This section covers for a business tenancy there must be:
- A tenancy
- The tenancy must be of premises
- At least part of the premises must be occupied by the tenant
- Occupation must be for the purpose of the business
What does Section 24 of the Landlord & Tenant Act 1954 detail?
Provides for the statutory continuation of the qualifying lease unless either party seeks to bring the tenancy to an end at or after the contractual lease end
What does Section 25 of the Landlord & Tenant Act 1954 detail?
Contains the provision for the Landlord to serve one of two types of notice bring the tenancy to an end:
- A “friendly” notice to terminate the current lease but not opposing a new lease on terms stated in the notice
- A “hostile” notice terminating the current lease and opposing the grant of a new lease under one or more of the grounds set out in s.28 of the Landlord & Tenant Act 1954
What does Section 26 of the Landlord & Tenant Act 1954 detail?
This section contains the provision for the tenant to seek a new tenancy
- It must sent to the competent Landlord
- It must also set out the tenant’s proposal for their new lease
What does Section 27 of the Landlord & Tenant Act 1954 detail?
Contains the provision for the Tenant to cease the current lease by not less than 3 months notice and not seek a new lease
What does Section 28 of the Landlord & Tenant Act 1954 detail?
Contains the grounds under which a Landlord can refuse the granting of a new lease
What are some of the grounds that a Landlord may refuse the granting of a new lease?
- Tenant’s failure to repair the premises
- Persistent delay in paying rent
- Substantial covenant breaches by the Tenant
- Landlord offers suitable alternative accommodation
- Landlord intends to demolish/redevelop the property
- Landlord intends to reoccupy the property
What is the difference between a lease and a license?
Lease - Tenant has exclusive possession of a defined area of land for a fixed period usually in consideration of periodic payments
License - To do something on a licensors property so that the permission given prevents the permitted act from being a trespass. It’s a personal right or permission that does not create an interest or estate in land.
What is the leading case law for the difference between a lease and a license?
Street v Mountford 1985
