The Practical Lawyer

Landlord and tenant – residential

Service charge – management company

Yet another illustration of the importance of consulting with all Ts under the service charge legislation.

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Long lease – improvements

L had a long lease of a flat (£195 pa) which expired in 2003. In about 1990, she carried out extensive improvements (with L’s consent).

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Service charge – holiday chalet

Holiday chalets cannot be occupied on a permanent basis (typically, they can be occupied for 11 months of each year). But, are chalets ‘dwellings’, and so within the scope of service charge protection under LTA 1985?

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Assured shortholds – tenancy deposit

The maximum rent threshold for HA 1988 tenancies increases to £100,000 on 1 October (it is currently £25,000). See our May 2010 issue (p24) for some of the problems this creates.

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Repossession – mortgagee

Prior to the dissolution of parliament, the Mortgage Repossessions (Protection of Tenants) Act 2010 was pushed through. What the Act does is to give protection to Ts who find themselves being evicted by L’s mortgagee (when L has failed to get proper consent for the let).

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Multiple Occupation – planning

Since April 2006, certain types of Houses in Multiple Occupation (HMOs) have had to be licensed by LAs (under HA 2004). These include properties that are let to three or more Ts, who form two or more households. Note, however, that there are now planning issues to be considered – and some Ls who may have already incurred costs in converting their properties to meet HMO licensing standards, may now find that they cannot obtain planning permission if they live in an area with a high concentration of HMOs.

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Sale of reversion – notice to Ts

When selling the freehold (or long leasehold) interest in a property subject to short residential tenancies, the T’s right of pre-emption under LTA 1987 must be considered. In particular, notices may have to be served on ‘qualifying Ts’.

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Assured shortholds – £100,000

If the annual rent is more than £25,000 pa, then it cannot be an assured shorthold. But, that figure increases to £100,000 as from 1 October [2010]. Whilst this change is not retrospective, it will affect all tenancies already in place on 1 October. Thus, a tenancy started before 1 October for rent of more than £25,000 pa, but less than £100,000 pa, will automatically convert to an assured shorthold on 1 October. But, commentators have highlighted a number of potential problems:

tenancy deposit: tenancies that convert to assured shortholds on 1 October will have had deposits taken on them prior to that date. Those deposits will not have been protected under a tenancy deposit scheme within 14 days of receipt. It is arguable that the deposits will not need to be protected, since they were taken at a point when protection was not required (and it is usually the act of taking the deposit that is seen as the trigger for protection).

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Discount rate – Sportelli

In Sportelli [2008] the discount rate for leasehold enfranchisement calculations was fixed at 5% for prime central London locations and all other locations.

It is worth noting that in Zuckerman [2009], the Lands Tribunal allowed a discount rate of 6% for some flats in Birmingham. However, a detailed article in Property Law Journal makes the point that it would be wrong to interpret this as a general retreat from Sportelli. What can be said, however, is that:

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Leasehold reform – ‘house’

LRA 1967 allows long lessees to acquire the freehold or be granted a lease extension, provided they occupy a ‘house’ – which is defined as ‘any building designed or adapted for living in and reasonably so called’. Some examples:

a property that had originally been a house and its associated mews (which were linked by a shared basement) was not a single ‘house’ (Malekshad [2002]);

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