Sub-tenant refuses to pay rent

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    #16
    Originally posted by Joe.K View Post
    I've just rang https://www.propertyinvestmentproject.co.uk for some advice, they said that regardless of the wording of the contract, if the contract duration is less than 6 month it's not considered an Assured Shorthold Tenancy. Therefore legally my tenant will be considered a lodger. Thoughts?
    This is wrong. AST's can be shorter than six months, it is just that you cannot have a section 21 expire before six months. If there were ways of avoiding a tenancy being assured, other than being a resident landlord, landlords would be jumping at them. As such there is little point in making them shorter than six months.

    (There is some careful wording in the above, as tenancies that aren't AST tend to be AT which give tenants much more rights than ASTs.)

    Comment


      #17
      Originally posted by Joe.K View Post
      I've just rang https://www.propertyinvestmentproject.co.uk for some advice, they said that regardless of the wording of the contract, if the contract duration is less than 6 month it's not considered an Assured Shorthold Tenancy. Therefore legally my tenant will be considered a lodger. Thoughts?
      That's absolute bollocks.
      It can't be an AST because the landlord lives in the property.
      An AST can be for any length of time.

      Don't ever trust their "advice" again.

      Tenants are excluded from protection if their landlord is a Resident Landlord (which I am), which means I'm only required to give 'reasonable notice'. So does this effectively overrides our written contract which states one month notice?
      See 'Resident Landlord': https://england.shelter.org.uk/legal...m_protection#3

      If this is the case, my tenant is considered an 'Excluded Tenant', which means I only need to give him reasonable notice. Our contract does say one month notice, however since he breached it by not paying rent am I right to understand that as an excluded tenant I can evict him on a reasonable notice only?
      See 'eviction of excluded occupiers': https://england.shelter.org.uk/housi...uded_occupiers
      The contract means that you should give a month's notice - the reasonable notice operates in the absence of any agreement otherwise.

      The tenant could technically sue you for the breach of contract, or go to court for a court order compelling you to adhere to the contract.
      Their breach doesn't allow you to breach in return.

      But what are the chances of that happening in realty?

      Also, as such I don't need to protect the tenant's deposit.
      Correct.
      When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
      Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

      Comment


        #18
        Originally posted by jpkeates View Post
        If he's an excluded occupier he has so few rights it's almost impossible for him to do anything, even if what you do is break your contract (in return for him breaking it).
        He could (in theory) sue you, but he won't.
        And that would take months to happen, it's not going to help him in the short term.

        I would give him notice for the end of the month and tell him you'll simply change the locks if he doesn't pay or go.

        Given that you live there, I'm not sure what the point of the deposit is, you'll know if anything gets damaged, and you don't want to use it for rent.
        Thanks, I'm just trying to understand if he's indeed considered an Excluded Occupier so I can follow that route.
        The contract I gave him does give him more rights (including one month notice), but as said - he breached the contract by not paying rent. So does this mean those 'extra rights' I gave him in the contract are essentially cancelled and we revert to Resident Landlord/Excluded Occupier laws/rights?

        Here's the text of the contract, for clarity:

        LEASE AGREEMENT
        The sublessor agrees to sublet and the subtenant agrees to take the premises described below. Both parties agree to keep, perform and fulfil the conditions and agreements below:
        1. The sublessor: xxx
        2. The subtenant: xxx
        3. Premises location: xxx
        4. The sub-lease covers sole use of the right-side back bedroom and shared use of the communal areas.
        5. The term of this sublease is minimum of 2 months, beginning 2nd August 2019, and will continue as a rolling lease thereafter.
        6. The rent is £600 per month, plus all-inclusive bills of £80, payable in advance on the 20th day of each month for the month ahead.
        7. The sublease agreement will terminate after 1 month’s notice is given by either the sublessor or the subtenant. There shall be no holding over under the terms of this sublease agreement under any circumstances.
        8. The lease may be liable to periodic rent increases. In the event of an increase in the rent payment the sublessor will provide the subtenant with a minimum of one month's notice.
        9. Utilities covered by monthly £80 fixed payment are Water, Gas, Electricity, Council Tax & Broadband. This utilities payment may be revised for the premises during the sublease
        agreement in accordance with latest supplier prices.
        10. Upon termination of the contract, the subtenant agrees to surrender and deliver to the sublessor the premises and all furniture and decorations within the premises in as good a condition as they were at the beginning of the term, reasonable wear and tear excepted. The subtenant will be liable to the sublessor for any damages occurring to the premises or the contents thereof or to the building which are done by the subtenant or their guests.
        11. Subtenant agrees to pay to sublessor a deposit of £680 to cover repairs and cleaning of such damages described above. Sublessor agrees that if the premises and contents thereof are returned to them in the same condition as when received by the subtenant, reasonable wear and tear thereof excepted, they will refund to the subtenant £680 at the end of the term, or within 30 days thereafter. Any reason for retaining a portion of the deposit shall be explained in writing within 30 days to the subtenant.
        12. This lease constitutes the sole agreement between the parties, and no additions, deletions or modifications may be accomplished without the written consent of both parties.
        13. The words “sublessor” and “subtenant” as used herein include the plural as well as the singular; no regard for gender is intended by the language in this sublease.
        14. The parties hereby bind themselves to this agreement by their signatures affixed below on this 26th day of July, 2019:
        SUBLESSOR: xxx, ____________________________(signature)
        SUBTENANT: xxx, ____________________________(signature)

        Comment


          #19
          Originally posted by jpkeates View Post
          That's absolute bollocks.
          It can't be an AST because the landlord lives in the property.
          An AST can be for any length of time.

          Don't ever trust their "advice" again.


          The contract means that you should give a month's notice - the reasonable notice operates in the absence of any agreement otherwise.

          The tenant could technically sue you for the breach of contract, or go to court for a court order compelling you to adhere to the contract.
          Their breach doesn't allow you to breach in return.


          But what are the chances of that happening in realty?


          Correct.

          Ok, understood. Thanks for this, much appreciated.

          Comment


            #20
            If you hadn't been a resident landlord, that agreement would have created an assured tenancy. I would suggest, if you want to continue giving exclusive access in future, you explicitly state that the landlord is a resident landlord and the intent is to create an excluded tenancy. (If you cease to be a resident landlord, you should terminate the sub-tenancy first.)

            You could provide an assured shorthold tenancy as a fallback, but it would be unwise to take a deposit, in that case.

            Comment


              #21
              Agreed.

              Get a lodger agreement from somewhere and use that.
              Sublessor isn't a thing that's easy to define, lodger is.

              It isn't worth taking deposits from lodgers.
              When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
              Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

              Comment


                #22
                Understood and will certainly implement this moving forward! Thanks again for the advice.

                Comment


                  #23
                  For Reference

                  https://forums.moneysavingexpert.com....php?t=6039267
                  Last edited by 45002; 21-08-2019, 14:15 PM. Reason: D8D Joe.K
                  Thunderbirds are go

                  Comment


                    #24
                    What a mess that forum is!
                    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                    Comment


                      #25
                      Originally posted by leaseholder64 View Post
                      What's happened here is that your landlord has transferred some of his risks onto you. .
                      Is that a fair comment? I know of some tenant who rent the entire property and then sub-let the rooms. They effectively are a resident landlord, but they profit from the arrangement. If the rent is £1000 pcm for the whole house. They will will charge the others £500 for two rooms, effectively living rent free. I don't know if this is what has happened in this situation. Or whether the rent is split equally.

                      Is this an HMO? It is an interesting question. If someone owned their home, lived in the property and rented out the rooms, then it is n't an HMO. Should it make a difference if the landlord owned the property or rented it from someone else?





                      Comment


                        #26
                        Maybe it shouldn't make a difference, but it seems clear that that's the intent.
                        When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                        Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                        Comment


                          #27
                          Just an update: bearing the legal limitations in mind, I presented him with two options for him to choose from: move out of the flat at the end of the month (so essentially a 9 day notice), or pay the full rent for September. I assertively told him he's not welcome here, that my preference is the first option, and that if he decides to stay an extra month, with or without paying the rent, his time here will be VERY uncomfortable (was going to tell him he cannot touch/use any of my belongings which basically means every single item in the flat since the flat was originally rented unfurnished. Or if things got really bad play loud music at night so he gets no sleep, it would've meant no sleep for me either but I'm sure he would've given up after a couple of nights), however I made it clear it's his choice. This way it's not an eviction. He chose the first option. I asked him send me an email stating he's choosing to move out on 31/8 by his own accord and doesn't require any longer notice. Done and dusted, no legal issues.

                          Thanks all for the advice. Will certainly only use a lodger agreement from now on.

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