The Practical Lawyer

Landlord and tenant – residential

Service charges – consultation

The Commonhold and Leasehold Reform Act 2002 has inserted new service charge consultation procedures into LTA 1985.

Consultation is required in respect of ‘qualifying works’ (ie ‘works on a building or any other premises’), or ‘a qualifying long-term agreement’ (ie an agreement that will last more than 12 months). If the works will require a contribution from any one T which exceeds the relevant threshold (£250 for qualifying works; £100 for qualifying long-term agreements) then the consultation provisions apply. There are three separate procedures:

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Human rights – RSLs

The CA has held that registered social landlords have to consider their T’s human rights when exercising housing management and housing allocation functions.

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Commission – Foxtons

In an important decision, the High Court has ruled that various commission clauses in Foxtons’ contracts with residential Ls are unenforceable. It is reckoned that there are around 15,000 letting agents using similar conditions, and accordingly this decision is important for the whole residential lettings industry. The end result is that many of these agents will face claims for refunds.

The case was brought by the OFT in respect of two types of commission clauses:

these entitled Foxtons to charge commission if T renewed the lease (even if Foxtons had no involvement in the renewal);

sales commission: this entitled Foxtons to a commission if L sold the property to T.

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Service charges – notices

Remember that it is vital that L serves any service charge notices on a long lessee at the correct address. A prudent L or managing agent should always check at the Land Registry, or Companies House, that the address for the T is correct.

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Tenancy deposit – non-supply of information

Under the Tenancy Deposit Scheme, L has 14 days in which to deposit the money with an authorised scheme, and 14 days to give ‘prescribed information’ to T. Failure on either account means that the court must order L to pay T a sum of money equal to three times the amount of the deposit.

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Accommodation – suitable alternative

One of the grounds for getting possession against (even) a Rent Act T is to offer ‘suitable alternative accommodation’. Indeed, such an offer is also a discretionary ground for possession in respect of an assured tenancy.

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Lease – for life

For a lease to be valid, it must be for a fixed term, or a periodic term certain. In other words, the start and finish dates must be certain, or capable of ascertainment.

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Long lease – expiry

When a long lease expires, T can remain in occupation and will become an assured T. This assumes, of course, that the new rent will not exceed £25,000 pa (if so, it will be too expensive to be an assured tenancy and thus T will have no security).

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Tolerated trespass – abolition

Tolerated trespass has been abolished as from 20 May for the vast majority of tenants.

The problem arose when L got a possession order, but with T then being allowed to stay at the property.

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Tenancy – minor

The Homelessness (Priority Need) Order 2002 conferred priority need status on the overwhelming majority of children aged 16 and 17, who are eligible for assistance from the HA. Accordingly, an increasing number of tenancies have been granted to minors since 2002.

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