Subletting notices and consents

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    Subletting notices and consents

    This note is therefore a practical approach for E & W using 1st and 2nd principles and therefore individual situations may prove the exception.

    As leases are often unique this to help you understand your lease and what to do.

    1 No matter how you think it should be or that you shouldn’t need permission for something you own, there is only one way “ what the lease says”
    2 Your idea of reasonable- time conditions and costs- usually aren’t.
    3 LL and MA responses are often just as wrong and some exploit the opportunity
    4 The average LA wont have a clue about anything of this and don’t worry no problem are just the usual BS
    5 Start the process immediately don’t wait till later that way documents are altered and ready and you the LA and T know what they need to do when the T is found.

    Mortgage Consent : Check your T & Cs on consent.

    Management matters: At the very least you need to provide
    -Your new contact info and tenancy length, and ideally T contact info for emergencies eg a flood
    -Never rely on tenants to pass on paperwork
    -Diarise dates for bills etc and when you don’t get them ask

    Consent and Notification: there are 2 parts to this process and may involve more than one party.

    Consent and Deemed Consent: The principle requirements for consent are
    -set out in the lease
    -Set out in the LLs requirements as long as they can be reasonably inferred from the lease
    -Statutory control Are limited in dealing with them in a reasonable time from 1 to 4 weeks depending on the complexity, yes not overnight, under the LTA 1988 and they can charge a fee for consents under the LTA 1927 even if the lease is silent

    These come in different forms and while some are standard some are unique and badly worded they fall into the flowing broad types
    -no requirement or a partial restriction eg not to underlet part
    -a simple notification and sometimes sending in copy documents
    -deemed consent eg allowing lettings under x years under a particular type of tenancy
    -very specific terms and conditions
    - requirement for the tenancy document to be approved and worded in certain way
    -may require a separate deed between your LL and the T

    3 important things to understand here
    1 LL or MA responses are often standard and may not apply
    2 The more complex the requirement the more time it will take
    You must therefore always
    3 Read the lease immediately you decide to let- the answer may be in several places so read it all.

    More than One Party- this applies to Notices too-a lease will have several parties and leads to you dealing with more than one person and you may get conflicting requirements- having done 3 above you will know who is wrong.

    Typically consent is given by the
    - person who granted the lease
    - a third party to the lease who deals with these eg an RMC
    - a statutory appointee eg an RTM or LVT appointed Manager


    It is important in consents to ensure that when dealing with a representative such a managing agent or solicitor that the consent is given on behalf of the above. Unless they are a party to the lease, they cannot give consent themselves, only as an agent on the LLs behalf, and therefore this binds the LL if agents change or freeholds/head leases are sold.

    Common, but mistaken practice, is that a consent is asked for each let but the lease or the LLs requirements may not need that. Consent can therefore be sought in whole or in principle that you can let on a certain basis and need then only notify the LL when the let is complete.

    Many agents will give global consents and therefore the above is especially important as they are long term be binding in the future on a new Landlord; they may be financially attractive.

    This is why each lease must be scrutinised to see what is required from whom, how long it will take, and who else needs to be told.

    Holding Over: While a new statutory periodic tenancy starts at the end of the contract it is important that when seeking consent and notices to ensure that you add that it includes “ any statutory continuation of the tenancy” to dissuade request for consent and new fees. If you grant a new tenancy then it is a new letting and a new consent may be required.

    Watch out for
    - some leases only allow letting for x out of y years
    - LL and MA are date driven when there is no end date they will issue reminders just respond that is a statutory periodic tenancy terminable on 2 months notice

    Consent T & C

    Basic match of L and T terms

    Even if the lease makes no real requirements it is important that your bog standard tenancy mirrors the lease. While it is broadly comparable glaring omission can find you “in trouble” with the LL but your T has no requirement in their Tenancy.

    This often concerns limitations on noise pets and specific behaviours such as use of common areas and facilities and can be as small as refuse out times, not leaving items such as bikes shoes and prams in the hallways or not keeping chickens and rabbits, and the all time favourite banging up a satellite dish.

    Specific Requirements

    These vary from simple steps to specific licences prepared by solicitors and approval of the references for the tenants and even a separate contract, a deed, to follow the rules in the lease between your LL and the T.

    Understanding the lease will allow you to establish whether the lease requires such a detailed consent, and if not argue if they are unreasonable. Unfortunately where a lease is broadly worded to require that no letting without prior consent, such detailed steps are still reasonable.

    Leases often state that consent cannot be unreasonably withheld ( and if they don’t it still applies under the LTA 1927) this really involves conditions and requirements that are inconsistent with common practice or the lease, not what you deem unreasonable. As properties are infinitely variable what is unreasonable can vary considerably and normally involve cases where holiday corporate local authority or student ( even a case of no disabled as we don’t want a ramp) lets are declined or exceptional requirements eg personal guarantees or deposits are sought.

    It is therefore if the restrictions are lawful and if your lease and property would reasonably call for them.

    Tied into this is timescale and as explained by 7 to 28 days depending on complexity.

    Much is said about certain Agents and Landlords but we wary of the Residents Committee who while less likely to charge silly fees are often those that impose wild and daft conditions and have no little sense of urgency, and lack the skill and awareness to deal with the complex consents.


    Leases often restrict the residents to particular groups such as one family and not sharers, so it is important to again understand the lease and see if this restrictions exist and if that particular wording is in fact enforceable.

    Deeds of Covenant And tenancy Riders

    As explained the rules of your lease need to match the tenants and in some cases it is required that the T include a rider that the T will abide by those rules or they have to enter into a specific Deed.

    You can now see that the bog standard tenancy from the internet retailers or the Agent won’t work, can get you in trouble, and need careful amendment at the earliest stage especially in detailed consents.

    Be aware that these are often poorly worded and require the T to pay GR SC and repairs, even though these are wholly or partly statute barred. It is important therefore to delete any references to this and restrict it terms which could be enforced. In practice few do and rely on those limitations though they are at peril of the time and costs of doing so.

    Fees

    This is the biggest source of argument but they are a necessary evil as the LL and MA costs of dealing with consents should be paid for by you not shared by everyone as that is only fair.

    Even if the lease is silent on costs consents costs are allowed to be charged under LTA 1927, but not notice fees, and must be reasonable and are protected under CLRA 2002, the LVT can determine them, and they must be work that is required under the lease. As above standard responses are often wrong. Check them against YOUR lease.

    Check against double vatting where a LL asks for their costs inc Vat which include a solicitors and agents costs which inc VAT

    Review to who fees are actually due under the lease- broadly worded leases will allow for a variety of costs while more restricted or qualified wordings will actually help you.

    Notices

    As a final reminder if you have a lease with several parties such as a FH who charges Rent but you deal with the RMC and the agent, the FH needs to be told too.
    Unless the lease says so there is no fee due to them so its important to understand the lease when contacting them and pre-empting any request for fees.

    Fees are set out in the lease but do note that there is no statutory authority for costs for notices nor are they under the control of the LVT.

    It is therefore common to load notice fees to offset reductions in consent cost. It is arguable that if consent to a specific letting is given that the work and need for notice is questionable, however, as daft as it may sound the notice fee is still due.

    Here the wording of the lease as to who gets notice is important. An agent or solicitor or agent may deal with the notices and ask for X plus VAT. If a lease requires that notice is given on the LL, who is not Vat registered, the fee is due to them, so do not pay the VAT, and ensure the payment is to them as agents for and it is receipted accordingly.
    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.

    #2
    Holding Over: While a new statutory periodic tenancy starts at the end of the contract it is important that when seeking consent and notices to ensure that you add that it includes “ any statutory continuation of the tenancy” to dissuade request for consent and new fees. If you grant a new tenancy then it is a new letting and a new consent may be required.

    Bear in mind that an SPT is not a statutory continuation.

    Comment


      #3
      Originally posted by leaseholdanswers View Post
      -Statutory control Are limited in dealing with them in a reasonable time from 1 to 4 weeks depending on the complexity, yes not overnight, under the LTA 1988 and they can charge a fee for consents under the LTA 1927 even if the lease is silent
      I'm not sure this is correct.

      s19 LTA1927 does not give a LL the right to charge a fee.

      There is however case law which deems that the LL can charge a fee where permission is required even when the lease is silent. The reasoning given is that a valid reason for refusing permission would be that no fee for considering the application is payable ... therefore a fee is payable.

      Some people including lawyers think the above reasoning is unsound and that the lease must refer to a fee (or there is some other form of agreement) for it to be payable.
      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.

      Comment


        #4
        Originally posted by Lawcruncher View Post
        Bear in mind that an SPT is not a statutory continuation.
        Thats absolutely right it is a new tenancy- the reason for including the wording was that the majority of MA's will not understand that and go away ( one OP has already had sucess with that in the forum) rather than pester for a new notice and fee.

        ... I did say it was a practical guide....
        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.

        Comment


          #5
          Originally posted by siva View Post
          .

          s19 LTA1927 does not give a LL the right to charge a fee.
          For the nth time.........

          (1)In all leases whether made before or after the commencement of this Act containing a covenant condition or agreement against assigning, underletting, charging or parting with the possession of demised premises or any part thereof without licence or consent, such covenant condition or agreement shall, notwithstanding any express provision to the contrary, be deemed to be subject—
          (a)to a proviso to the effect that such licence or consent is not to be unreasonably withheld, but this proviso does not preclude the right of the landlord to require payment of a reasonable sum in respect of any legal or other expenses incurred in connection with such licence or consent; and
          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.

          Comment


            #6
            Originally posted by leaseholdanswers View Post
            For the nth time.........
            but this proviso does not preclude the right of the landlord to require payment of a reasonable sum
            Yes, that's right.It does not preclude the right to charge a fee if one exists. However it doesn't give the LL a right if it doesn't already exist.
            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.

            Comment


              #7
              Sigh you really like twisting yourself up in knots dont you? I dont get it but whatever makes you happy....I guess its a lack of broad understanding and unwillingness to get one despite cvovering this before at least twice.

              You have it, and for the last time, backwards. The law is clear a landlord can charge a fee under the law, a contract cannot contradict that except to expressly ( lawfully) contract out. There is no need for fee or cost to be mentioned in the lease, it is in simple terms a statutory right to charge a fee.

              Any response is just wasting your time chap.
              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.

              Comment


                #8
                Originally posted by leaseholdanswers View Post

                Any response is just wasting your time chap.
                I respond so that people reading the thread understand that it is not statute that allows the permission to sublet charge but case law. Case law can always be overruled.

                The case I referred to earlier and again here is here.

                In para. 9 the president (at the time) of the Upper Tribunal states "It is not right in my view to say that section 19(1)(a) confers on the landlord the right to make a charge. What it says is that the proviso (that consent is not to be unreasonably withheld) does not preclude the right of the landlord to require payment of a reasonable sum in respect of any legal or other expenses incurred in connection with such consent."

                This case is also discussed by J (a barrister) here. In the comments section he states "Well, we know from some of the subsequent cases (also covered on the blog) that the UT are now saying that, if the lease provides for the consent of the landlord to be needed for a sub-let, then that consent can be on terms that you pay a reasonable fee. The 1927 Act just isn’t going to come into it in almost all cases."

                So there you go. It's case law that allows the fee, not statute.
                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.

                Comment


                  #9
                  But are there any decisions of the High Court on the point?

                  It certainly used to be the case that in the commercial field it was assumed that if the lease did not provide for the tenant to pay the landlord's costs for consents that was the landlord's hard luck and he ought to look to his solicitor for failing to provide for it.

                  The real problem here which needs to be addressed is the whole question of fees payable by tenants. Whilst commercial tenants can perhaps be expected to look after themselves, residential tenants under long leases are being treated as milch cows by the professions involved and fees are way out of proportion. All too often the fees are paid because challenging them is not a practical option or the tenant is advised to take the line of least resistance.

                  Comment


                    #10
                    Originally posted by Lawcruncher View Post
                    But are there any decisions of the High Court on the point?
                    I doubt it. They would have been discussed on the Nearly Legal blog or on here if there were.

                    I don't know if you read the UT decision but the logic used to determine that a fee can be charged is rather odd to say the least.

                    It is basically this. The LL would be allowed to reasonably refuse permission if no fee is paid therefore a fee is payable.

                    I see three things wrong with that:

                    1) There is no agreement. Normally you have to agree to any charges.
                    2) There are very few reasons to refuse permission to sublet residential premises these days. there is quite a lot of case law on this and the trend definitely seems to be that if the lease doesn't state any restrictions on who can live in the property then there's no reasonable grounds to refuse permission. I'm not sure a fee that isn't mentioned in the lease would qualify as grounds for refusal.
                    3) Even if non payment of a fee is grounds for refusal it doesn't mean the fee is payable. The leaseholder still has the option to decide not to sublet.
                    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.

                    Comment


                      #11
                      Hi sorry to bother but how do i make a new post
                      Kind Regards
                      Lucia

                      Comment


                        #12
                        Originally posted by Luciawaterson View Post
                        how do i make a new post
                        See the link below.

                        http://www.landlordzone.co.uk/forums...44-how-to-post

                        Comment

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