Opinion on advice to landlord from its agent

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    Opinion on advice to landlord from its agent

    I am one of four directors of a limited company that owns a building where the company has 67 long leases, and the company's affairs are managed by an agent.

    Our agent asked for our approval to write an aggressive letter to our leaseholders, enforcing a particular covenant and threatening legal action for any breach. They suggested that as the issue was urgent a letter should be sent in the next few days.

    To support their advice, they gave us a letter they had already sent on behalf of the landlords of another property they manage, and the lease from a further property claiming the landlord had implemented a "zero tolerance" policy.

    The implication was that if other landlords had acted on their advice, so should we.

    The agent did not make clear that the "zero tolerance" policy relied on a different covenant that isn't in our own lease , did not warn us that the Upper Tribunal considered the covenant in question was ambiguous, or that they didn't think any of our leaseholders were actually in breach.

    We were therefore contemplating taking urgent action to address a problem that doesn't exist, based on legal provisions that might not apply, guided by actions of landlords whose circumstances weren't equivalent to our own.

    I would like to ask how other people would react in similar circumstances.

    Thank you.

    #2
    Zero tolerance policy normally refers to fire safety (and other safety) breaches by storing things in stairwells. You have a remarkably well managed block if you are actually successfully managing a "managed policy". Unfortunately managed policies are often used as an excuse for inaction, when a breakdown in discipline should actually trigger a zero tolerance one.

    If this is the situation you are describing, I find it strange that you have a lease that actually permits people to store things in stairwells. Managed policies are normally implemented as tolerating breaches.

    If this is not a stairwell storage issue, could you explain what the zero tolerance applies to?

    Comment


      #3
      If this is a fire safety issue, and you need a zero tolerance policy, but don't have the authority to enforce it, your lease is defective, as failing to enforce it would be a criminal offence. I would say that a lease that doesn't allow the prevention of fire hazards is failing to provide an adequate standard of amenity, and therefore subject to the one party lase variation route, through the FTT, although one would probably proceed at risk, to avoid the cost to the leaseholders of actually getting the lease changed.

      Again, if this is not a health and safety issue regarding communal areas, please explain what they intend not to tolerate.

      Comment


        #4
        I was deliberately vague about the particular covenant because I'm interested in opinions about biased advice from agents, rather than the merits of enforcing any particular covenant (which doesn't involve fire safety).

        My concern is that we were led to believe there was an urgent need to act, and sending a heavy-handed letter threatening legal action on that covenant would bring about a sure and certain positive outcome.

        If the agent had said "we advise X, based on Y grounds, but the risks are Z" that would be fair enough, but they didn’t

        Instead they said "we advise X, and here's a letter we wrote on behalf of some other landlord, and here's some other landlord's lease".

        I don't know what grounds the first landlord relied on or what their outcome was, but I do know that the second landlord could only implement their policy by relying on a different covenant that we can’t.

        The agent has also subsequently said there is no need for urgent action.

        I'd like to hear opinions about a landlord's paid professionals who advise a course of action with no thought to the grounds that would be necessary, and without highlighting the possibility that pursuing that action could actually make their client's position worse.

        Thank you for your time.
        Last edited by MartynSE5; 14-12-2019, 22:44 PM. Reason: Fix typos

        Comment


          #5
          Originally posted by MartynSE5 View Post
          I'd like to hear opinions about a landlord's paid professionals who advise a course of action with no thought to the grounds that would be necessary, and without highlighting the possibility that pursuing that action could actually make their client's position worse.
          Common place in my experience. If the covenant isn't in your lease what are they planning to enforce?

          Are you a freehold company with power to use s146 to enforce this 'threat' to get your legal costs back on the lease from yourselves? Have you insurance to defend yourself against being counter actioned for something else you failed to do?

          Agent doesn't have to pay. Does agent indemnify your company?

          Pays always to be alert and research for your company. Or get another agent. We have from time to time been urged to do things that didn't need doing that way, and would have stirred up a hornet's nest.

          You give the instructions. Say please go read the lease and give supported advice on each option. That's your job.

          Download a few court decisions and see how leaseholder companies get cost hit even with agents in tow. Agent doesn't pay the consequences.


          Do not read my offerings, based purely on my research or experience as a lessee, as legal advice. If you need legal advice please see a solicitor.

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