Is this break clause valid using a section 21 notice

[blurbunny]

I began a 12 month fixed AST on 5/10/07. After only 5 months I received an abusive phone call from the LL wanting to raise the rent from £675 pcm to £725 pcm. I refused as did many of the other tenants within the block. I've heard nothing until, sat 24/5/08, when i received a section 21 notice of possession, which states i need to move out by the 19/7/08 unless i pay £775 pcm + a renewal fee of £300 to cover the LL's costs.
After looking into section 21 we understood that this could only be served 2 months from the end of my 12 month ast contract. After phoning the landlord representatives, they informed me that there is a break clause in my contract. Here is the clause:

v. the Landlord may terminate this agreement by giving not less than 60 days notice in writing to the Tenant and upon the expiration of such notice this Tenancy Agreement and everything herein shall cease subject nevertheless to the rights of the Parties hereto in respect of any antecedent breach or non observance of the covenants or stipulations herein contained and so that such notice may not be served prior to 5th day of April 2008.

The LL's representative agrees i have not breached my contract in any way. It is simply because the landlord wants more money. Is this clause valid to terminate my AST in this way, while using the section 21?

[lorenzo]

The language in that clause is fairly impenetrable legalese. IIRC this renders it potentially unfair.

Also I suspect even if valid, S21 is not the correct notice in such instance.

Warning: BWTFDIK

[jeffrey]

1. As the letting is for a year, s.21 cannot give vacant possession during the term.
2. The break clause is not so incomprehensible as to be unusable.
3. L is entitled to serve a Break Clause Notice at any time after the first six months and has now done so.
4. The rent issue is irrelevant to this.

[blurbunny]

so are you saying that they are within their right to terminate my contract usng the abovementioned break clause? but the section 21 notice is not the correct way of doing it? if this is not the correct notice type, could you advise me on the correct way they should be doing this? thank you

[agent46]

It would appear the LL can rely on the break clause, however, the LL has not complied with HA 1988 s.21 in that he served the notice on 24/5, but is seeking possession from 19/7. This is less than 2 months, which invalidates the notice.

[lorenzo]

2. The break clause is not so incomprehensible as to be unusable.

Hi jeffrey,

Not withstanding the other points, I doubt whether the clause would be understandable to 95% of the population. Of course it is probably perfectly simple and clear to those in the legal profession, but not me; and I am well acquainted with professional jargon in my own field, which would befuddle even you (that is not intended as a sleight, merely as an illustration).

What does it mean exactly?

http://www.plainenglish.co.uk/consumercontracts.htm

Cheers

[agent46]

Hi jeffrey,

Not withstanding the other points, I doubt whether the clause would be understandable to 95% of the population. Of course it is probably perfectly simple and clear to those in the legal profession, but not me; and I am well acquainted with professional jargon in my own field, which would befuddle even you (that is not intended as a sleight, merely as an illustration).

What does it mean exactly?

http://www.plainenglish.co.uk/consumercontracts.htm

Cheers

It means that after 5th April 60 days notice can be given by the LL to the tenant to end the agreement and after those 60 days have expired, the tenancy will in fact end. However, the rights of either party to seek a remedy for any breaches of tenancy that happened before then will continue.


Further thoughts....

It appears this was a unilateral break clause.

Did anyone mention unfair terms yet?

[blurbunny]

no unfair terms mentioned as far as im aware. do you mean have i mentioned unfair terms or the landlord? i'm not quite clear of what you are saying . could you elaborate further please. thanks

[lorenzo]

The language in that clause is fairly impenetrable legalese. IIRC this renders it potentially unfair.

Further thoughts....

It appears this was a unilateral break clause.

Did anyone mention unfair terms yet?

Yes me, but because of the plain English campaign.

But it seems there are now two points that make it potentially unfair.

[agent46]

no unfair terms mentioned as far as im aware. do you mean have i mentioned unfair terms or the landlord? i'm not quite clear of what you are saying . could you elaborate further please. thanks

Sorry - I was being rather obtuse.

By the Unfair Terms in Consumer Contracts Regulations 1999 any term which is not individually negotiated and which causes a significant imbalance in the rights and obligations of the parties may be a unfair term, and thus unenforceable.

In this case:

1) If you do not have a broadly similar right to end the tenancy early (ie: significant imbalance of rights)

and

2) If the break clause formed part of a standard form tenancy and was not bargained over separately (ie: not individually negotiated)

Then the break clause may be an unfair term.

In any case, I don't think the LL can rely on the s.21 notice as he has given less than 2 months notice as required under the HA 1988.

[jeffrey]

Yes me, but because of the plain English campaign.

But it seems there are now two points that make it potentially unfair.

Point 1 (that the wording is technical): I doubt that this argument will invalidate the clause.
Point 2 (that only L has a termination right): this may permit T some room to argue a lack of balance - and so that it's unfair- unless L and T individually negotiated the clause (or whole Agreement) which would mean that T has no further right to claim unfairness.

[blurbunny]

i have in effect the same clause on the contract as the landlord has - the tenant can terminate clause . sorry wasnt clear on that.

so they are completely within their rights then?

using the section 21??

[jeffrey]

i have in effect the same clause on the contract as the landlord has - the tenant can terminate clause . sorry wasnt clear on that.

so they are completely within their rights then?

Yes, in my opinion.

...using the section 21??

No. As I explained, s.21 is not a break-clause-related provision. L can serve a s.21 Notice, sure, but no Possession Order under it could operate during the fixed term. L really needs to serve only a Break Clause Notice- which, I think, has not yet been done validly- and the result so far is that your tenancy will continue unless and until L does just that. He has to give at least 60 days' notice to you- nothing to do with s.21's two-month requirement, despite the final bit of agent46's post #10!

[agent46]

He has to give at least 60 days' notice to you- nothing to do with s.21's two-month requirement, despite the final bit of agent46's post #10!

My view of this is that whilst at common law the LL has complied with the terms of the break clause, the only way in practice the LL can actually operate the break clause is to use a s.21 notice. And HA 1988 s.21 requires 2 months notice.

In summary, although the LL has complied with the strict terms of the break clause, he won't be able to rely on his s.21 notice to achieve possession.

[jeffrey]

My view of this is that whilst at common law the LL has complied with the terms of the break clause, the only way in practice the LL can actually operate the break clause is to use a s.21 notice. And HA 1988 s.21 requires 2 months notice.

In summary, although the LL has complied with the strict terms of the break clause, he won't be able to rely on his s.21 notice to achieve possession.

That cannot be true, because s.21 does not work during fixed term. On your logic, therefore, no break clause could ever work.