Agent in liquidation - query over tenancy

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    Agent in liquidation - query over tenancy

    Hi everyone. I’ve several properties which I lease to a lettings agent and they then sub let to the tenants. The tenancy agreement states the agents as the landlord to the tenant. The rent was guaranteed. This company have now gone into administration and will be liquidated in 2 weeks. The tenants are all social tenants and many do not engage with the agency.

    Could someone one give me some clarification on where we stand with the tenancy agreements once the company has gone. We have been told that because they have an AST it will still be valid but the landlord on the AST is the agent who will not exist at that point.

    Many thanks for any advice

    #2
    Did you register with companies house as a creditor and object to the dissolution of the company?

    From the point of view of the tenants the landlord is their landlord. The company in administration will be owed rent, and you will be a creditor of the company. I am no expert, but generally a company’s contracts remain enforceable upon insolvency.

    I think you are in a pretty bad position and you need urgent expert advice and you need to remain in contact with companies house and the liquidators.

    Too late for you, BUT NEVER EVER act as landlord via an intermediary (and never ever let to "social tenants" either unless you know exactly what you are doing and how to manage the risks).

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      #3
      Hi
      Thanks for your reply. We are registered as creditors and are in talks with the council about the tenants. Some tenants have contacted us directly to discuss payments.

      We had a number of reasons for using the company which worked well for us for 10 years and we were aware of the social tenants. The guaranteed rent and 10 year leases for properties with them was a selling point!

      We were primarily wondering if the tenants would end up squatting in the properties after the insolvency. But that does not seem to be the case.


      Thanks agian for the reply.

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        #4
        I don't think they will be squatting. I think they will still have a valid tenancy. The question is with whom.

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          #5
          Will the tenancy be vested in the trustee which will be the insolvency practitioner? Once they have discharged their duties, assuming there is little value in the tenancies, they will revert to you. If the tenancies have value, then conceivably they could sell that interest but your first port of call would be to discuss with the trustee what happens, which will be the IP.

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            #6
            Who is named as LL on Ts AST?
            Get confirmation that you are now resp for LAs Ts living in your properties, with same T&Cs.
            Who protected the Deposit?
            You may have to provide Ts with a new address for 'Service of Notices'.

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