Laura Severn: No Dogs Allowed!
Laura Severn is a Legal Executive and Operations Director and Head of Client Care at award-winning Brady Solicitors. As well as supervising debt recovery, Laura is involved in maintaining and developing the company case management system and works flow. Directly available to clients and regularly advising on all issues surrounding ground rent and service charges, Laura is also the firm but fair “Enforcer” in monitoring service standards and key performance indicators.
In this article Laura explains how serious the potential consequences can be for leaseholders when they breach any of their lease covenants, even if the breach may seem insignificant.
If a leaseholder breaches any of the terms of their lease their landlord may have a right to forfeit the lease and recover possession of the property. Breach of alteration covenants or repairing covenants can also put the leaseholder themselves and others in danger (not to mention invalidating insurance)!
Most leases contain covenants prohibiting leaseholders from doing certain things. Such prohibitions can be wide ranging as we have dealt with breaches ranging from a persistently barking dog (which we had to evict), preventing a leaseholder from consistently putting up his own satellite dish and being consulted about the removal of an elephant from the common gardens of an exclusive residential development!
Leases also contain covenants which require landlords and leaseholders to carry out certain repairs, or to provide certain services, information or consent.
Common problems that arise are:
- Noise nuisance
- Removing carpets and installing hard wood floors
- Carrying out alterations without consent
- Keeping pets
- Failure to carry out repairs
If a landlord believes that a breach of covenant has occurred then the following steps should be taken:
1) Check The Lease
The lease may need interpreting to establish if a breach has occurred. Also check that the lease contains a clause allowing the landlord to re-enter the premises in certain circumstances, e.g. where there has been a breach of the lease. Check that the re-entry clause covers the tenant’s act you are complaining about. It is also worth checking the costs clause because it is likely that the cost of any action is also recoverable from the leaseholder.
2) Negotiate With The Other Side
This is an often undervalued solution. Either informal or formal mediation between 2 parties in order to resolve the dispute can often save relationships and avoid the need for protracted and or expensive proceedings.
Landlords can only take action when a court or the Leasehold Valuation Tribunal (or equivalent) has determined that a breach of a covenant or condition of a lease has occurred.
Only the county court has jurisdiction to enforce lease covenants. The Leasehold Valuation Tribunal does not have power to order a person to carry out certain works. If you just want a breach remedied then obtaining an order from the court for this purpose is a good option. However, if the breach remains then the next step would be;
Landlords are required to serve a notice under Section 146 of the Law of Property Act 1925 warning of potential forfeiture. This notice must specify the breach and give the leaseholder the opportunity to remedy the breach or to compensate the landlord for the effects of the breach.The s146 notice can’t be served until 14 days after a final determination of the breach has been made. Any notice should also be served on any subtenants.
If the breach is not remedied then forfeiture proceedings can be commenced and the lease is at risk. An order for possession of the property can be obtained. Where the property is lawfully occupied as a dwelling, the landlord cannot re-enter the premises without a court order.
It is clear that there are a number of opportunities throughout the above process for the leaseholder to correct matters to avoid forfeiture and it should be noted that measures have been introduced into legislation to protect leaseholders. The law is also likely to continue to develop in this area.
If landlords do want to consider forfeiting the lease and regaining possession of the premises then they should ensure that they do not waive the right to forfeit. To ensure that the right to forfeit remains throughout the process, landlords should ensure that no sums due under the lease are demanded or accepted (even on a without prejudice basis). Any communication with the leaseholder should be on a without prejudice basis (if at all).
A waiver of forfeiture can be any action (no matter what is intended) which recognises the continued existence of the lease and the continuing relationship of landlord and tenant. For some breaches (which are called “continuing breaches”), it may not be a problem if the right to forfeit is waived because the right can arise again. However, if you are unsure then seek advice – a cautious approach is required.
What if there is a sub tenant in situ? Or the sub tenant is the cause of the breach?
The covenants within the lease are not only binding on the leaseholder but in turn any tenant. This is usually dealt with by a clause within the tenants Assured Shorthold Tenancy (AST) agreement.
If the leaseholder is the cause of the breach then the subtenant is also at risk. Any s146 notice must be served on the sub tenant warning of the risk of forfeiture. However, the subtenant is able to rectify any breach on their landlords behalf and in some circumstances could also apply for relief from forfeiture.
More commonly the subtenant is the cause of the breach but it should be noted that the breach still remains the responsibility of the leaseholder and the lease is still at risk. The sub tenant is likely to also be in breach of their tenancy agreement. The lease is still at risk of forfeiture from the actions of a sub tenant and so leaseholders should consider this carefully when selecting their tenants. One tactic to use in these circumstances is to copy the letting agents in to any correspondence, as the buy to let leaseholder may not have any idea that his tenants are causing issues!
Disclaimer: The above article is for information purposes only. Whilst every effort has been made to ensure all information is accurate and up to date, it does not constitute a comprehensive review of the applicable law and should not be relied upon as such.
For further information on this and any other legal matter or dispute, please contact Laura Severn on:
Office Tel: 0115 985 3450
Fax: 0115 985 3457