Repeat fees for notice of underletting

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  • Repeat fees for notice of underletting

    I have an apartment with a property management company (guess!) acting as the Freeholder's agent. My question is about my obligation to pay repeat notification fees for the same tenents over time, which I fear they will attempt to charge for.

    My lease states "to give the landlord and the Management Company notice of every dealing with or underletting or transmission of the legal estate in the Demised Premises including all mortgages or legal charges of the Demised Premises within twenty one days after the same shall occur and to pay each of the Landlord and the Management Company such reasonable registration fees (including VAT) as the Landlord and the Management Company respectively shall from time to time determine."

    I wrote to the Landlord's agent company and told them the property has been sub-let on an AST, gave them the start date and the tenents' names, and sent the £120 fee they specified.

    They banked the cheque, but wrote requesting a copy of the AST and the expiry date. I refused to supply a copy of the AST on the grounds the lease did not specify I am required to do that (which they subsequently acknowledged)and told them that whilst the AST does have an initial term (which I didn't specify), it is likely to evolve into a Statutory Periodic Tenancy under the same agreement, and so they should not assume an expiry date and that instead, I would inform them when the tenancy comes to an end. Surely that fulfils my obligations to "give notice of the underletting" (which is not defined in the lease and which I have found no standard legal definition of online).

    I have now received a "paid invoice" from them which includes an "expiry date" six months after the start date of the AST.

    I intend to again tell them (for the third time) they should assume no expiry date, that I shall inform them when the tenancy ends and that any continuation beyond the initial AST term will be on the same agreement (for which I have no further obligations to inform them or pay any fee).

    Am I correct? I'm sure they are demanding the "expiry date" only so they can re-invoice every six months, but since no new agreement is created, I can't see my legal obligation to pay any such charges.

    Also, I've read a lot about these fees being outside the jurisdiction of LVT, through clever wording, but if an LVT is not the appropriate legal body for these charges, what is - the County Court?

    I've read through so many of the Q&As on this excellent forum but can't see these points covered so I'm hoping you may be able to help. Thanks in advance.

  • #2
    You should only need to "renew" permission to sub-let when the tenants
    change, so if they are there 3 years, you only pay once.


    • #3
      That's my understanding of my obligation from the lease too, but I think the property management company may have a different one!

      To clarify, this isn't for permission to sublet (that's not required under the lease), it's simply about notification of the sublet.


      • #4
        You can still go to the LVT for a ruling on this like I did:


        There have been one or two cases recently where the LVT have felt they were empowered to rule on notice fees. Give it a go.


        • #5
          Ressurecting a thread I started some months back, but I have now received a letter requesting I pay a "renewed Notice of Underletting" fee for my existing tentants to remain in my property, at a discounted (!) charge of £72.

          The accompanying form asks me to tick the duration of subletting of 6mths/12mths/other which seems to suggest to me that maybe most leaseholders renew their ASTs for set periods. Is that right, or do most simply let them become Statutory Periodic Tenancies (as I have)? Is there any advantage in creating a new agreement each time?

          My view is that the relevant lease clause (above) does not give the Freeholder or their agent the right to charge for renewals of registration where the same tenant remains in place, under the same agreement, albeit as a Statutory Periodic Tenancy. Is that right? If I'm wrong on this, and given that SPTs are monthly rolling contracts, would the Freeholder agent be expecting to (and have the right to)charge for renewal fees monthly?

          What puzzles me is I can find so little about registration fee renewal disputes being resolved, either on this forum or the web generally. The vast majority of challenges made to LVTs on this topic fail because registration fees are judged to fall outside the definition of variable administration fees (and I agree) and are therefore outside the jurisdiction of LVTs (I know there are a few exceptions, but these are very much in the minority; and JKO, I know you have successfully avoided your registration fees following the LVT comments in the case above, but even there, it was judged outside their jurisdiction). So do leaseholders then just give up?; or do they take the issue onwards to the County Court?, and what results have been achieved there? (I can find no reference to County Court judgements on this topic, but maybe they don't get listed on the internet; I don't know).

          There's so much on this forum about consent fees, but little I can find about Notice of Registration fees, and particularly renewal fees (NOT linked to a consent clause); but this situation must be very very common. Has anyone successfully challenged registration renewal fees, particularly at County Court? Or does eveyone simply pay up?


          • #6
            The LVT is the place to go John. If you go to court you expose yourself to Landlord's legal costs if you lose.

            A number of LVT's have considered they have jurisdiction.


            • #7
              I have a flat whose lease states I have to pay a fee for permission to sublet. However, it does not specify I have to obtain permission for each tenancy. So I paid the fee once, and then never again.

              There is something in English law known as the contra proferentem rule, which basically means, if there is any confusion or ambiguity whatsoever in a contract, this will be interpreted against (= contra) the party who drafted the contract (= proferentem).

              In my case, this means that as the lease does not specify that permission must be sought (and paid for) for each let, the clause must be interpreted in my favour, and therefore to mean that permission need only be sought once.

              So anybody who has such a clause in their lease would be well advised to read it carefully to see, quite literally, if there is room for interpretation!!

              Best of luck!


              • #8
                I would write again to the managing agent stating :-

                I have given you notice of subletting, for which you charged £ 120
                for the notification and registration.

                I have not re-let my flat to anyone different, therefore there is
                not need to notify you, and no need for you to charge me, because
                the same sub-tenants are there, and there is nothing for you to do,
                because all your records will remain static and stagnant until I
                re-let to some one new.


                However, if you refuse to give them a copy of the Ast, you are in
                breach of the lease.
                I should ( in fact, you must ) give them a copy of the AST, showing
                names and start date, but you can if you wish cross out the finish
                date, then they cant charge you every year for failing to supply
                an AST, as that will be their next argument.



                • #9
                  What is the name of the freehold company anfomanaging agent ?
                  Have these companies' names been mention before on this LZForum ?

                  Does your receipt for payment of 120 pds ( including VAT) show the VAT Registration Number for the managing agent or for the freehold company?


                  • #10
                    Thanks for the replies

                    Ram - Yes, my intention is to write along the lines you suggest. When I refused to supply a copy of the AST, I had a e.mailed reply from them agreeing that the lease does not require me to supply it, but that I just needed to supply tenant names (which I did) and term/expiry date, to which I said it was an AST and that they should assume it remained in place until I informed them otherwise. From that, they then assumed a 6 mths term; hence the renewal demand. Surely if it's not specifically stated in the lease, I'm not obliged to provide the full AST? [Incidentally, since they acknowledge that I don't need to provide the AST, it removes any argument that the quantum of their fee is largely taken up by reviewing the tenancy agreement, which is the usual case put forward (though in this instance I'm not challenging the original fee, just the renewal fees)].

                    Gordon - Not sure I'm allowed to mention company names on here, am I? They're a well-known company with lots of mentions on this forum and have successfully challenged the LVTs ability to rule on registration charges many many times. I have a letter acknowledging receipt of the orignal payment but no VAT receipt.


                    • #11
                      The Moderator will erase the names as they don't want to be threatened by solicitors but if you quote a couple of LVT ref case numbers I can look up the details.


                      • #12
                        The requirement to give notice is just that, "I name have let property to name for time months from date".

                        Unless there is another clause requiring consent or sight of the document no need to send it at all.

                        As for underletting, the underletting ends and a SPT begins, however if you give notice that says "and any SPT thereafter" they are done.

                        A sensible strategy with avaricious landlords/agents, subject to the terms of the lease, is to do just that, or give notice for 3 years, or let for 3 years, with a mutual break clause after 6 months or a year.
                        Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.


                        • #13
                          When subletting there is no actual need for a tenancy agreement. Any agreement can be verbal. So just notify them that the term is indefinite.

                          I also wonder whether there is a potential way to avoid these types of ongoing costs by entering into an agreement to sublet to a family member for one day less than the term left on the lease. Register this agreement.

                          Then all AST subletting could be between the family member and the tenant without the need to register again as the family member is not party to the lease.
                          I accept no legal responsibility for comments/advice I make on this forum. Please check with a solicitor before acting on statements made in a public forum.


                          • #14
                            That might work however the lease might restrict such a term and they might reasonably claim, where consent is required, that the under lease has similar terms.

                            Giving up use or possession of a property can be done without an agreemetn but its not advisable where covenants have to be enforced or you want them to leave
                            Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.


                            • #15
                              Gordon - As I'm not making any allegations or defamatory remarks against them, I guess I'm OK in saying that {Mod - name removed} is the agent requesting the payment.

                              Leaseholdanswers - thank you for that info on post#12. That's more or less what I did - I told them at the time of registration that they should assume the agreement remains in place until I notify them otherwise. They then re-e.mailed, requesting the expiry date of the tenancy, and I said I expected the agreement would evolve into a STP that I will notify them when the tenancy comes to an end. They have ignored that, and assumed a 6-month tenancy.


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