New occupants in flat, leaseholder denies subletting

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    New occupants in flat, leaseholder denies subletting

    Hi everybody,

    I am a director of a block managing company, which is the freeholder of a block of flats.

    We recently obtained a Tribunal decision that a leaseholder was in breach of a single-family user clause in our leases by subletting to sharers. The sharers subsequently left. [Our thanks to the body of knowledge here and helpful long-time posters.]

    Since then, new people have taken up residence but the leaseholder now denies subletting. The leaseholder alleges a single friend is staying as a guest but it's obvious that multiple people are living there with the leaseholder absent. We have no visibility of the terms of the arrangements.

    We are considering a further Tribunal application given the lease states:

    "Not at any time during the said term separately to assign transfer or part with the possession or occupation of any part or parts of the Demised Premises but only to assign transfer or part with the possession thereof as a whole..."

    Our case would be the leaseholder has parted with occupation and we would provide witness statements from neighbours.

    Does that sound like an appropriate case? It's a very frustrating and time consuming approach but unfortunately the leaseholder is not one to be reasoned with.

    Many thanks and regards.

    #2
    As long as there is a single tenancy, I don't see that there is any breach of the lease based on what you quote.

    Comment


      #3
      It might be a breach of the single family condition, but you didn't quote that.

      Does your local council operate Additional Licensing in your area, because, if they do, and this is not a single family plus lodger, they should be interested.

      Unfortunately, on a forum like this, you may find as many people who would like to advise the sub-letter how to get away with it.

      Having a real lodger or guest doesn't involve parting with possession.

      Sub-letting sharers is sub-letting the whole, not just part, so permitted by the clause you quote.

      Comment


        #4
        Thanks. Very useful.

        Our view was that if the leaseholder wished to part with possession/occupation, the correct approach to do so was by subletting.

        The subletting/possession/occupation clause is:

        32.
        (a) Not at any time during the said term to sublet the whole or any part of the Demised Premises except by shorthold letting of the whole of the Demised Premises or by other letting of the whole at a rack rent not exceeding two years without the prior written consent of the Lessor
        (b) Not at any time during the said term separately to assign transfer or part with the possession or occupation of any part or parts of the Demised Premises but only to assign transfer or part with the possession thereof as a whole and not to assign transfer or part with the possession or occupation of the Demised Premises during the last seven years of the said term without the prior written consent of the Lessor or its agents (such consent not to be unreasonably withheld)


        There is also a clause to provide any tenancy agreement for review:

        34.
        "Within one month ... to be given to the Lessor notice in writing ... in the case of an underlease a copy thereof for registration and retention"


        and a single-family clause:

        1.
        "Not to use or suffer to be used the Demised Premises for any purpose whatsoever other than as a private residence for occupation by a single family"


        The leaseholder previously fell foul of the single-family clause and a group of student sharers moved out. When new people moved in, the leaseholder refused to provide any tenancy agreement, stating there was no subletting arrangement but instead a friend is 'occupying' the flat.

        When we advised that the lease states that parting with occupation is not permitted except by subletting, the story changed to be that the leaseholder is continuing to live at the property while allowing a friend to stay there as a guest. However, we know the leaseholder is living elsewhere.

        Currently we have no idea who is living in the flat (although there are 3-4 people at any one time) or whether they constitute a single family. As we have no legal relationship with them our ability to enforce our estate regulations are limited and neighbours have been raising concerns about security, noise, etc...

        Our worry was that in pursuing the 'single-family' clause the leaseholder could change their mind again, saying they are no longer at the property and there is only one family there. Therefore we were going to pursue them on the grounds that they had parted with occupation of the property.

        However, perhaps a better approach is to ask the tribunal to rule on all the various breach possibilities, as the leaseholder must either be:

        1) breaching the single-family use clause;
        2) breaching the requirement to obtain subletting consent and providing a copy of a tenancy agreement;
        3) breaching the requirement not to part with possession or occupation of part/parts of the flat; or
        4) breaching the requirement not to part with occupation of the whole of the flat.

        Our local area doesn't operate any additional HMO licensing; they are fairly lenient in that regard.

        Apologies for the length.

        Comment


          #5
          I feel I need to ask: Why is whatever is going on a problem?

          Comment


            #6
            Originally posted by Lawcruncher View Post
            I feel I need to ask: Why is whatever is going on a problem?
            I would be interested in the same.

            I see nothing to be gained if the occupants are not causing any problems - and if the occupants are causing problems there may be other, better ways of dealing with the issues.

            If the leaseholder otherwise meets his obligations (e.g. makes service charge payments on time, etc.), all that you might achieve is to encourage him to try to make things as difficult as possible for you when it comes to managing the block.

            Comment


              #7
              Sure. pull up a chair....

              Over the past 5+ years we’ve had increasing trouble from flats moving from traditional subletting or owner-occupancy to airbnb/holiday type letting, student lettings, corporate lettings and other groups of sharers. Issues from these types of letting have included serious noise nuisances, parking problems, leaks neglected causing damage, litter thrown out of windows, abandoned property in hallways, etc.... and even once someone drunk kicking in the wrong flat door.

              Whether it’s relevant or not as background, the building is an old conversion of ~25 flats, for people returning after The Great War, so the walls/floors aren’t particularly substantial. If the flats were more modern and ‘contained’ it would probably be more suitable for multi-family sharers.

              Obviously single families can potentially cause these types of problems too but our experience has been that they haven't.

              Many of the leaseholders with tenants causing the major issues were either ineffective or simply apathetic, some even arguing that it wasn’t their problem to address, etc...and leaving it to us as the residents' management company to grip issues with local estate agents as they were 'away with work' etc... It was getting to a point where more owners were considering selling up as a result of the nuisances, which would have accelerated the problem as more flats would likely then have been sold on and sublet airbnb style; as we're near a popular location this type of rental yields a higher return. If too many owner-occupiers moved out, there would then be fewer people taking care of the building, etc... We considered this a real problem and it was discussed at length.

              We therefore decided to tackle this proactively through enforcing the lease clauses, specifically the single family clause. Having liaised with leaseholders about the single family clause and the benefit to the block as a whole, the subletting leaseholders all agreed to only place in single families at their next tenancy break. However, several leaseholders nevertheless decided to still place in sharers and we regrettably had to refer those cases to Tribunal. Consequently we have successfully stopped all non-single family flat shares; this has correlated with a near elimination of antisocial behaviour over the past year. The block is now in a much better state of affairs with the residents and (almost all) leaseholders happy.

              We are therefore concerned that if we now turn a blind eye to a leaseholder again allowing non-single family occupation, this could be seen by the other leaseholders as someone ‘getting away’ with it and the problem quickly comes back. This would be unfair on those leaseholders who are selecting single-family tenants, of which we now have many.

              Hopefully that helps set the context?

              With regards this particular leaseholder, they have consistently tried to work around the single-family clause, for instance by providing a tenancy agreement with only one person listed and denying knowledge of several others in the flat, who paid through the single person.

              Based on this and other actions we do not trust this leaseholder. When I said previously that "we have no idea who is living in the flat" now, we suspect it is a group of local workers but the leaseholder has advised the 'occupants' not to speak to any neighbours about their arrangements. As such, we thought it might be more expedient to prove a breach of parting with occupation (as the leaseholder is not there), rather than gathering evidence about the residents not being a single family. If that's not feasible, we will probably go back to gathering evidence of multiple families in occupancy and consider Tribunal once sufficient evidence is gathered.

              I hope that helps and you don't all think we're being over-zealous; we believe we've been acting in the best interest of the Company to the benefit of all leaseholders, the building and also residents.

              Comment


                #8
                Is there a clause within the lease whereby the leaseholder is entitled to peaceful enjoyment of his property? If so, you may be in danger of breaching that clause with this particular leaseholder. I am surprised that you do not have other priorities at the block.

                Comment


                  #9
                  I can understand wanting to enforce the clauses you mention if you have previously had problems of the sort you describe, and these have been significantly reduced by enforcing these.

                  I wouldn't have thought your clause 32 will be much use to you due to the difficulty of obtaining evidence.

                  Lawcruncher will likely be better placed to advise you than I am, if he(?) finds time to reply.

                  Comment


                    #10
                    I am concerned with the overall tone of your posts and it does appear that you are showing bias against one leaseholder and to a lesser extent a small group of leaseholders. It comes across that you are monitoring closely one particular leaseholder. Obtaining witness statements from neighbours suggests that you are trying to turn other leaseholders against this person. “Gathering evidence” should not be restricted to one leaseholder but that appears to be the case.

                    Comment


                      #11
                      Post 7 noted.

                      As to clause 32:

                      "(a) Not at any time during the said term to sublet the whole or any part of the Demised Premises except by shorthold letting of the whole of the Demised Premises or by other letting of the whole at a rack rent not exceeding two years without the prior written consent of the Lessor"

                      This is ambiguous. It is unclear whether "without the prior written consent of the Lessor" applies to a shorthold letting. I am inclined to think not as if you take out the other letting section you get:

                      Not at any time during the said term to sublet the whole or any part of the Demised Premises except by shorthold letting of the whole of the Demised Premises without the prior written consent of the Lessor

                      The effect of that it is that it would be a breach of covenant to let shorthold with the landlord's consent. So, if he is subletting and the tenancy is an AST I do not think you can get him on breach of paragraph (a).

                      "(b) Not at any time during the said term separately to assign transfer or part with the possession or occupation of any part or parts of the Demised Premises but only to assign transfer or part with the possession thereof as a whole and not to assign transfer or part with the possession or occupation of the Demised Premises during the last seven years of the said term without the prior written consent of the Lessor or its agents (such consent not to be unreasonably withheld)"

                      The interpretation of such provisions is fraught with difficulty. What it often comes down to is whether the tenant has ceded control of the property to the occupant. That will be a question of evidence.

                      As to the "family" clause, it again comes down to evidence. The courts tend to interpret such provisions very liberally in favour of the leaseholder.

                      Comment


                        #12
                        You already have a tribunal determination the leaseholder is in breach. I don’t see why you need to go back for another determination.

                        If the lease has the standard S146 clause or another clause allowing you to recover costs, I would be sending a letter before action saying you will be seeking forfeiture if the breach is not remedied, and then serving the s146 if not remedied. The leaseholder will soon realise they have a lot to lose if they don’t remedy.

                        They are clearly in breach of the clauses quoted, but proving it will be tricky but not impossible. Gather as much evidence as possible about the comings and goings, get down the council and check the electoral register, see who is registered there, report to the council housing team in writing, if you can get them to inspect, that will be useful evidence. Check if they have a mortgage, and copy the mortgage company in on the S146 if they do have, if it’s not a buy to let mortgage that will cause the leaseholder issues too, also is the property insured for multiple occupancy, another potential breach.

                        Its not going to be easy to prove the occupation status but not impossible. I’ve successfully pursued a leaseholder for this and succeeded.

                        Comment


                          #13
                          Although we are talking about civil issues here, not criminal ones, a crime doesn't cease to be a crime because there isn't enough evidence for a conviction. If that were the case, the crime figures would probably drop by an order of magnitude. Most criminals work on the basis that they don't expect to be convicted.

                          Sub-landlords who flout leases also do so because they expect not to be caught out. The eleventh commandment, "thou shalt not get found out" seems too prevalent in modern thinking.

                          In the situation being described, I imagine that the OP is getting a lot of pressure from the remaining owner occupiers, to bring the sub-landlords under control, and there lease clauses are there to achieve that.

                          (People who lie about running HMOs and hotel rooms, are also quite likely to be committing real crimes as well, in terms of tax, safety, and licensing violations.)

                          Comment


                            #14
                            You could set up gallows in the communal areas

                            Comment


                              #15
                              Thanks all for your valuable views.

                              We certainly have no intention of breaching any peaceful use clauses. However, a couple of leaseholders cause the majority of problems for all other leaseholders and sadly we've found the only successful way to achieve a positive change has been the legal route. We only act following complaints from our residents/leaseholders. Our experience is the Tribunal will call for witness statements if it goes the distance.

                              Regarding Lawcruncher's interpretation of the clauses, many thanks. We'd reached a similar lay conclusion on the subletting clause. Annoyingly the leaseholder is stating there is no subletting in this case, otherwise we could obtain a copy of the tenancy agreement under clause 34 (we did this previously, which informed us of the occupants). This leaves us with 32b, which is as you say is difficult but not impossible to prove with sufficient evidence.

                              Regarding DNM2012's comment, this flat was vacant for a few months after the Tribunal's previous determination. As such, we had assumed that breach had ended and we would need to obtain a further determination in any new tenancy/case. Or would the Tribunal's previous determination remain 'live' in case of a further breach? Even if not, I'm sure it would be useful background for a future determination.

                              As our primary concern is HMOs and holiday type rentals I think we'll await any further evidence provided to us and, if/when we have a sufficient case, proceed based on that.

                              I'll raise the gallows (or at least that suggestion) at the next meeting!

                              Comment

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