Tenant or Licensee?

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  • Tenant or Licensee?

    Hi,

    Wondering if anybody can shed some light on this situation. Basically my wife and I bought an existing HMO property recently where the tenants were all signed up on AST's......or so we thought.

    After serving notice on one of the tenants to vacate, we had a shock when Citizens Advice contacted us (in a non too pleasant attitude), stating that she was in fact an Assured Tenant and the AST we have is forged ! The previous owners had tried to evict with no joy.

    Essentially, this particular tenant had entered into a tenancy agreement in 1996 (prior to the new tenancy legislation in 1997) which was a rolling 2 week contract with 2 weeks notice on either side. Rent paid weekly. However, as the landlord at the time (the one before our vendors) never served a s.20 notice on her - apparently it automatically became a Assured Tenant (which as I'm sure people know, means you can only get rid of the Tenant in very limited situations).

    We were pondering if it was possible to establish that she is a licensee of the property as opposed to a tenant. Reasons for this are that she pays no bills, and shares a bathroom and other communal areas (hallway, garden etc) with other tenants.

    Does anybody know what the criteria are for establising a licensee over and above a tenant?

    Obviously we could sue the vendors for fradulent misrepresentation but aren't keen to go down a potentially lengthy and costly legal battle.

    Suggestions VERY welcome !!

    Many thanks
    Mark

  • #2
    Originally posted by barney1979 View Post
    Hi,

    Wondering if anybody can shed some light on this situation. Basically my wife and I bought an existing HMO property recently where the tenants were all signed up on AST's......or so we thought.

    After serving notice on one of the tenants to vacate, we had a shock when Citizens Advice contacted us (in a non too pleasant attitude), stating that she was in fact an Assured Tenant and the AST we have is forged ! The previous owners had tried to evict with no joy.

    Essentially, this particular tenant had entered into a tenancy agreement in 1996 (prior to the new tenancy legislation in 1997) which was a rolling 2 week contract with 2 weeks notice on either side. Rent paid weekly. However, as the landlord at the time (the one before our vendors) never served a s.20 notice on her - apparently it automatically became a Assured Tenant (which as I'm sure people know, means you can only get rid of the Tenant in very limited situations).

    We were pondering if it was possible to establish that she is a licensee of the property as opposed to a tenant. Reasons for this are that she pays no bills, and shares a bathroom and other communal areas (hallway, garden etc) with other tenants.

    Does anybody know what the criteria are for establising a licensee over and above a tenant?

    Obviously we could sue the vendors for fradulent misrepresentation but aren't keen to go down a potentially lengthy and costly legal battle.

    Suggestions VERY welcome !!

    Many thanks
    Mark

    Very quickly......

    The test for distinguishing between a licensee and a tenant is if there is exclusive possession of property, for a term at a rent, then it is a tenancy (Street v. Mountford) If they shared with other tenants (as opposed to the LL), and the LL did not retain the right (and just as importantly, exercise that right) to move them from room to room, or enter to provide services such as cleaning and bed linen etc then they are probably tenants. It is possible to create an assured tenancy of a room where the cooking and washing facilities are shared; see Uratemp Ventures v. Collins [2002] 1 AC 301 and also Miller v Eyo (1999) 31 HLR 306, [1998] NPC 95, CA, which held that such living arrangements can constitute a "dwelling house" for the purposes of HA 1988.

    On the point about suing the vendor - don't claim fraudulent misrep as it is too difficult to prove. Claim against them in negligent misrep instead.

    You should think about getting professional advice asap.

    Good luck.
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    • #3
      I agree with previous post that she is a tenant.

      Suggest you put the rent up, but it must still be market value.

      If you can get good evidence to prove they tried to evict before, you should not need to go to court if you can negotiate accepable compensation between yourselves. Its worth a try.
      All posts in good faith, but do not rely on them

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      • #4
        thanks for the advice - thats really helpful. I'd pretty much guessed it would be difficult to prove she was a licensee and your comment has cemented that in my mind.

        We've been around the houses (no pun intended) and spoken to our lettings agent, solicitors etc about what best to do.

        Our first port of call is to offer her a move to a refurbished room (her current room is horrific) on the proviso that she signs a new AST and forfeits her AT rights. Not sure if its going to work but it's the simplest solution and worth a try. Failing that we'll take legal action - appreciate the comment on negligent misrep.

        Cheers
        Mark

        Comment


        • #5
          Originally posted by barney1979 View Post

          Our first port of call is to offer her a move to a refurbished room (her current room is horrific) on the proviso that she signs a new AST and forfeits her AT rights.
          You'll be lucky! Make sure that she really does understand the implications of what she is doing, or it wont stand up in court and you can end up with her still on an AT in a better room.

          You could also bribe her to move out.

          Good luck.
          All posts in good faith, but do not rely on them

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