Social housing providers are at the heart of the communities they serve and, for that very reason, can sometimes find themselves embroiled in neighbourhood conflict. That is exactly what happened in one case in which a social landlord was ordered to pay more than £8,000 in harassment damages to two of its tenants.
 
The tenants, a man and a woman, were concerned about anti-social behaviour in the area where they lived. One of them had been obliged to move four times and had formed a community group to gather evidence of unacceptable behaviour, which was posted on a website. The other was so concerned about her security that she had installed CCTV equipment to keep watch on her property.
 

Their activities had generated a considerable amount of hostility from neighbours and their landlord, a social housing trust, received complaints that the man was invading other residents’ privacy by recording them going about their lives. There was particular concern that he had filmed children and young people. There were also complaints that the woman’s CCTV equipment covered an area beyond the boundaries of her property and was being used for an inappropriate purpose.

The landlord’s response was to issue escalating warnings and threats of legal action against the tenants. They were accused of causing an annoyance or nuisance to their neighbours, in breach of their tenancy agreements, and were eventually told that injunctions would be sought against them and that their homes were at risk. After the tenants obtained legal advice, they launched proceedings against the landlord under the Protection from Harassment Act 1997.

In upholding their claims, a judge found that the landlord’s analysis of the complaints had been wholly uncritical and inadequate. Baseless and entirely incorrect allegations had been made against the man. The woman had been granted specific permission by the landlord to install CCTV at a previous address and had reasonably assumed that the same equipment could be installed at her new home. Both tenants had been subjected to an oppressive course of conduct and the man was awarded £4,750 in damages. The woman received a £4,160 award.

In dismissing the landlord’s challenge to the judge’s ruling, the Court of Appeal found that the approach of the landlord’s estate manager had been hopelessly careless and that the tenants’ treatment clearly amounted to harassment. Both were long-term assured tenants and the landlord had at all material times been aware of their concerns about anti-social behaviour. In the circumstances, the landlord should have known that its unjustified actions would cause them alarm and distress.

For help and advice contact Sundeep Bilkhu on s.bilkhu@sydneymitchell.co.uk or call 0808 166 8974.

 

Plenty of parents have difficulty in convincing their home-bird children that it might be time to fly the coop and get a place of their own, but one American family was forced to resort to extreme measures to get their 30-year-old son to move out of home.

The married couple from New York were forced to bring their son to court to have him evicted from their home, where he had lived for the last eight years.

The court heard that the couple, aged in their fifties, had made multiple and increasingly desperate attempts to convince their son to move out of his own accord, but to no avail. They had served him with letters asking him to leave and had offered him money and support in finding a place of his own and a job.

But the son, who represented himself in court, argued with the judge that he was entitled to six more months of living in the family home. The judge, after failing to convince the son to move out of his own volition, called that demand ‘outrageous’ and issued an eviction order. The son in turn called the eviction order ‘outrageous’.

The court heard that the parents had given their son a letter telling him he had 14 days to vacate the house and stating that they would “take whatever actions are necessary to enforce this decision.” When he refused to leave, they gave him another letter telling him to move out immediately and advised him to sell some of his property to help support himself. They also offered to help him find a job.

Speaking outside the court, the son insisted there had been no incidents of falling out between him and his parents but said he intended to appeal the eviction notice.

Fortunately most parents won’t need to go to such lengths to convince kids who are reluctant to spread their wings!

For help and advice contact Sundeep Bilkhu on s.bilkhu@sydneymitchell.co.uk or call 0808 166 8974.

Tenants are legally entitled to be consulted before their landlords sign agreements with their managing agents or others that extend beyond a 12-month period and result in the levying of service charges. As a Court of Appeal case showed, failure to comply with such requirements can have extremely serious consequences.

The case concerned an urban block of flats occupied by over 150 leaseholders. The property’s freeholder launched proceedings against one tenant in order to recover more than £24,000 in alleged arrears of service charges. Part of that related to the tenant’s contribution to fees payable by the freeholder to its managing agent.

That portion of the service charges was, however, disallowed by the First-tier Tribunal on the basis that the agreement between the freeholder and its agent was a qualifying long-term agreement – within the meaning of Section 20ZA(2) of the Landlord and Tenant Act 1985 – to which mandatory consultation requirements applied. There was no dispute that those requirements had not been met. The freeholder’s challenge to that ruling was later rejected by the Upper Tribunal.

In dismissing the freeholder’s appeal against the latter decision, the Court of Appeal noted that the relevant agreement stated that it would last for one year. However, it did not stop there, also providing that the agreement would continue thereafter. On its true interpretation, the agreement introduced a mandatory requirement that it would continue beyond the initial 12 months for an unspecified further period.

In those circumstances, the Court found that the agreement was indeed a qualifying long-term agreement to which the consultation requirements applied. The failure to comply with those requirements meant that, by operation of the Service Charges (Consultation Requirements) (England) Regulations 2003, the tenant’s contribution to the managing agent’s fees was capped at £100 per annum.

For help and advice contact Sundeep Bilkhu on s.bilkhu@sydneymitchell.co.uk or call 0808 166 8974.

A great many commercial and residential leases grant rights to tenants that can only be exercised with their landlords’ consent, which cannot be unreasonably withheld – but what exactly does the latter phrase mean? The Court of Appeal considered that issue in a case that broke new legal ground.

The case concerned a six-storey building occupied by a corporate tenant under a 100-year lease. The company wished to apply for planning consent to change the use of the building’s second and third floors from storage to residential. However, the lease contained a tenant’s covenant not to apply for planning permission without the prior written consent of the landlord, such consent not to be unreasonably withheld.

The landlord had refused to grant the required consent on grounds that a successful application for planning consent would significantly increase the proportion of the building that was used for residential purposes. That in turn would boost the tenant’s hopes of employing the leasehold enfranchisement provisions of the Leasehold Reform Act 1967 in order to acquire the freehold of the property.

The landlord owned a large number of properties in the area and viewed leasehold enfranchisement as an undesirable prospect that would impinge on its proper management of the wider estate. After the tenant launched proceedings, however, a judge found that the landlord’s consent had been unreasonably withheld and opened the way for the tenant to lodge the required planning application.

In ruling on the landlord’s challenge to that decision, the Court noted that the case raised novel issues on which there was no previous authority. In dismissing the appeal, it observed that the lease expressly authorised the tenant to use the whole of the building for residential purposes. There was no proviso that residential use of the whole or any part of the property was subject to the landlord’s consent.

In those circumstances, the Court found that the landlord had refused consent for the planning application for the collateral purpose of restricting the tenant’s right to make residential use of the entire building. The reality was that any third party could apply for planning permission to authorise such use and that only the tenant was precluded from doing so without the landlord’s consent. It seemed inconceivable that that was the intention of the original parties to the lease.

For help and advice contact Shilpa Unarkat on s.unarkat@sydneymitchell.co.uk or call 0808 166 8974.

 
 

Contract terms that seek to set agreements in stone, preventing their subsequent oral modification (NOM clauses), have long been controversial – but the Supreme Court has ruled in a guideline case that they perform important functions and neither frustrate nor contravene any policy of the law.
 
A property company that operates office developments in London had granted a licence in respect of certain premises to an advertising agency. The agreement stated that it set out all of the terms that had been agreed and that any variations would only take effect if formally approved in writing by both parties.

The agency accumulated licence fee arrears and its director proposed a schedule of payments to a credit controller employed by the company, by which some payments would be deferred and the payment of arrears would be spread over the remainder of the licence period. The company subsequently locked the agency out of the premises, terminated the licence and sued it for the arrears. The agency counterclaimed, seeking damages for wrongful exclusion from the premises.

A judge accepted that the company had, via the credit controller, orally agreed to the schedule of payments. However, he went on to find that the company was entitled to claim the arrears without regard to that agreement because it did not satisfy the formal requirements of the NOM clause. The Court of Appeal later upheld the agency’s challenge to that ruling on the basis that, by orally agreeing to the agency’s proposal, the company had also consented to dispense with the NOM clause and to accept an oral variation of the licence agreement.

In allowing the company’s appeal against that ruling, the Supreme Court noted that NOM clauses are commonplace and perform important purposes. They prevent attempts to undermine written agreements by informal means; they avoid disputes about whether variations are intended and, if so, their exact terms; and they make it easier for corporations to police their own internal rules.

By its decision, the Court of Appeal had overridden the contracting parties’ intention to bind themselves as to the manner in which future changes to their legal relations were to be achieved. In those circumstances, there had been no variation of the licence agreement and the company was entitled to rely on its strict terms.

For help and advice contact Sundeep Bilkhu on s.bilkhu@sydneymitchell.co.uk or call 0808 166 8974.

 

Buying real property at auction is full of pitfalls and should never be attempted without taking expert legal advice. In a case that proved the point, the buyer of a pub forfeited its £35,000 deposit after failing to complete the purchase on time.
 
After the pub was sold to the buyer at auction for £350,000, it paid the 10 per cent deposit. However, the purchase was not finalised when it should have been and the seller issued a notice to complete. The deadline for compliance with that notice came and went and the seller terminated the contract, retaining the deposit.
 
The buyer’s response was to enter a unilateral notice against the pub’s registered title on the basis that the sale contract was still live and that it remained ready, willing and able to complete. It was argued that the failure to complete arose because the seller had breached an agreement to transfer the premises licence to the buyer. In those circumstances, the buyer submitted that it had been unable to draw down the funds required to finalise the transaction.
 
In upholding the seller’s application to remove the notice from the pub’s title, the First-tier tribunal (FTT) noted that the auction particulars had made no mention of the sale being conditional on the transfer of the premises licence to the buyer. Without legal advice being taken on either side, the seller had orally agreed to transfer the licence to the buyer for £2,000, plus compensation for expenses arising from the delay. However, no such payment had been made and the FTT found that the agreement was in any event free-standing and did not impact on the seller’s strict contractual right to insist on the completion deadline.
 
For help and advice contact Jay Singh on j.singh@sydneymitchell.co.uk or call 0808 166 8974.

 

Many long leaseholders believe that their legal position is almost identical to that of a freeholder. However, in a case that showed how mistaken that view is, a maisonette dweller who failed to obtain her landlord’s consent before making a hole in an exterior wall was found to have breached the terms of her lease.
 
The woman held a 999-year lease in respect of the upstairs flat in a Victorian house. Her landlord, who owned the property’s freehold, occupied the flat beneath her. There was a history of disputes between them in respect of service charges and other matters. In particular, the landlord complained after a plumber knocked a hole in the wall in order to fit the tenant’s toilet with a new waste pipe.

Following lengthy proceedings, the Upper Tribunal (UT) granted the landlord a declaration under Section 168(4) of the Commonhold and Leasehold Reform Act 2002 that the tenant had breached a covenant in her lease. That covenant forbade her from altering, cutting or maiming any of the maisonette’s exterior walls without first obtaining the landlord’s written consent to the works.

That decision opened the way for the landlord to seek forfeiture of the tenant’s lease under Section 146(1) of the Law of Property Act 1925. However, the UT noted that, if there were to be further proceedings, the nature and seriousness of the breach should be viewed in context. Had the tenant asked permission to make the hole, it was highly probable that the landlord could not reasonably have refused her request.

For help and advice contact Jay Singh on j.singh@sydneymitchell.co.uk or call 0808 166 8974.

 

Entering into property deals without legal advice is like trying to run before you can walk and can lead to untold heartache and financial loss. That was certainly so in the case of a man who invested a six-figure sum in refurbishing a country cottage and barn for the holiday letting market, although he had no long-term security of tenure.

The man believed that he had spotted a business opportunity after coming across the property, which was in a derelict condition. Without taking professional advice, he agreed to lease it from the farmer who owned it for a fixed term of 15 years at a rent of £400 per annum. There was, however, no evidence that the farmer had signed the lease agreement and it was thus of no legal effect.

However, the man and the farmer continued to treat the tenancy as valid and, after the expiry of the 15-year term, the man remained in possession for a further six years at an increased annual rent of £1,000. He spent over £200,000 on renovating the property and, by his efforts, increased its value from at most £190,000 to about £375,000.

After the farmer’s son, to whom the property’s freehold had by then been transferred, served him with notice to quit, the man launched proceedings. Amongst other things, he sought declarations that he had an equitable interest in the property and was entitled to a new lease by virtue of the Agricultural Holdings Act 1986.

Rejecting the man’s arguments, however, the Court found that the property was not an agricultural holding. There had also never been a common understanding that he would be able to retain possession of the property indefinitely. Neither the farmer nor his son had given him any promise or assurance to that effect.

Given the insecurity of his position, the man had invested in the property at his own risk and, if he had failed to recoup his expenditure by subletting it to tourists, that was because he had made a bad bargain. The Court’s ruling opened the way for the farmer’s son to seek possession of the property.

For help and advice contact Shilpa Unarkat on s.unarkat@sydneymitchell.co.uk or call 0808 166 8974.

Landlords who know that their property is being used in violation of environmental rules cannot escape criminal liability simply by sitting on their hands. The High Court made that point in a case involving a plot of land from which more than 20,000 mattresses, weighing over 470 tonnes, had to be cleared.
 
The company that owned the plot leased it to a businessman who used it to operate a mattress recycling centre. He was served with an enforcement notice by the Environment Agency (EA) and ceased trading at around that time. The company and its director were subsequently convicted by magistrates of knowingly permitting the operation of a waste storage facility without being authorised by an environmental permit, contrary to the Environment Permitting (England and Wales) Regulations 2010.

 

Fine

The company was fined £5,000 and the director was sentenced to a 12-month community order, with a requirement to carry out 150 hours of unpaid work. Each was also ordered to contribute over £7,000 towards the costs of the prosecution.

In challenging the convictions, they argued that they had initially been unaware of the enforcement notice and that the director had been out of the country at the time. Once they realised what was going on, they had cooperated fully with the EA. It was also submitted that, between the dates charged, the site was in the process of being cleaned up and was no longer being used for a regulated purpose.

In dismissing their appeal, however, the Court found that a waste operation had continued on the site after the tenant’s departure, in that large amounts of waste had remained in storage there, prior to its clearance. The Court also ruled that, in order to establish that they knowingly permitted the operation, it was not necessary to show that the company or its director had performed any positive acts. It was sufficient for the prosecution to prove that they knew a waste operation was taking place and that they did nothing to prevent it.

For help and advice contact Sundeep Bilkhu on s.bilkhu@sydneymitchell.co.uk or call 0808 166 8974.

Leases are not just pieces of paper.  It’s always wise for a potential tenant to seek legal advice so that they’re “in the know” and understand the implications of the words that are written in the document that they are asked to sign before they take occupation of their property.

Heads of Terms (covering the main points such as the length of term, rental, any rent free period, break right, the repairing obligation, rent deposit requirement etc.) will usually be drawn up by a Landlord or its agent and will be put to the Tenant.  There may be little or no negotiation and these Heads of Terms (together with other terms which weren’t necessarily discussed or agreed at the time) will then find their way into a Lease, a legally binding 30-40 page contract between the Landlord and the Tenant.

The importance of “knowing your Lease” has been highlighted by a case which involved a residential property tenant. The flat tenant’s 99 year Lease included a covenant that it must not cut, maim, alter or injure any of the property’s principal walls without the Landlord’s prior consent.

When the boiler in the flat broke down, the Tenant employed a plumber to install a new condensing unit which involved cutting at least one new hole into a flank wall to make way for an exhaust vent and waste pipe. 

The Landlord sought to forfeit the Lease on the basis that the Tenant had breached the covenant of the Lease as it had not obtained its consent to the works. 

Forfeiture was not granted on this occasion as the breach was described as modest and if the Landlord was successful, it would obtain only nominal damages.

The parties were advised to reach a sensible compromise rather than continue with the court proceedings.

The point however is that had the Tenant known about his obligation to seek his Landlord’s consent before carrying out the works and made application to obtain it, he would not have ended up defending a claim for forfeiture of his Lease.

If you are an existing Tenant or you are proposing to enter into a Lease, get in touch today for a Lease Health Check and we’ll let you know what you need to know.

For more information, please contact Shilpa Unarkat on 0121 746 3300  / s.unarkat@sydneymitchell.co.uk or Sundeep Bilkhu on 0121 698 2200 / s.bilkhu@sydneymitchell.co.uk

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