Old T gives notice, new T signs up, old T changes mind

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Old T gives notice, new T signs up, old T changes mind

    Got a mate who just called me asking for landlords advice. He signed a contract to rent a house from Aug 11. Existing T had given notice to quit Aug 1st.

    Now exisitng T wants to stay another year.

    My mate is pretty irate and I just wanted to check that my advice I have given him so far is correct.

    As I understand it he and the Landlord are not in a strong position. Landlord may have common remedy of charging double rent(can anyone verify the source of this?). He may be able to sue the Landlord for any losses if he has to pay more for an equivalent house, but he has told me has only signed contract and not paid a deposit, this means there is no consideration so he cannot sure unless it is a deed.

    He did not move in yet so there is no AST.

    I advised him that law favours the tenant and specifically an occupying tenant as opposed to a prospective tenant as only the court bailiffs can evict which could take months.

    Hence would I be correct in saying he is screwed?

    #2
    Originally posted by ah84 View Post
    My mate is pretty irate and I just wanted to check that my advice I have given him so far is correct.

    As I understand it he and the Landlord are not in a strong position. Landlord may have common remedy of charging double rent(can anyone verify the source of this?).
    Yes, there is a very, very old provision contained in an Act (whose title escapes me) from the 17th or 18th Century that has never been repealed which provides that when T has served NTQ and does not give the LL vacant possession, then the LL is entitled to twice the rent for the period of occupation after the expiry of the NTQ. Other than that, I don't know a lot about the doctrine.

    Originally posted by ah84 View Post
    He may be able to sue the Landlord for any losses if he has to pay more for an equivalent house, but he has told me has only signed contract and not paid a deposit, this means there is no consideration so he cannot sue unless it is a deed.
    There is consideration as there was (in the contract) a mutual exchange of valuable promises - LL, "I will grant you an AST on 11th Aug" and, Your mate, "I will pay you rent and a deposit."

    The paperwork amounts to a contract to create an AST and, but for the continuing occupation of the exisiting tenant, it would have been specifically enforceable.* However, as the exisiting tenant is remaining in possession, the Court would not order specific performance, and only damages would be payable by the LL to the prospective T.

    It is possible, and I do emphasise that I am only thinking off the top of my head, that, as performance of the contract has become impossible due to the act of a 3rd party, the Court may rule that the contract is "frustrated" and no damages will be payable.


    Originally posted by ah84 View Post
    I advised him that law favours the tenant and specifically an occupying tenant as opposed to a prospective tenant as only the court bailiffs can evict which could take months.

    Hence would I be correct in saying he is screwed?
    I'd say that is a pretty accurate analysis of his situation.


    * Specific Performance is an order of the court in which a party to a contract is ordered to perform their side of the bargain. This may sound obvious, but the usual remedy awarded by the Court is damages (ie: a money payment in compensation). However, in some contracts, usually concerning land or unique goods, the court will order "specific performance". The most well-known example of this is when contracts have been exchanged in a house purchase and the vendor then pulls out - in such a case, the Court can force the vendor to sell the house to the purchaser.
    Health Warning


    I try my best to be accurate, but please bear in mind that some posts are written in a matter of seconds and often cannot be edited later on.

    All information contained in my posts is given without any assumption of responsibility on my part. This means that if you rely on my advice but it turns out to be wrong and you suffer losses (of any kind) as a result, then you cannot sue me.

    Comment


      #3
      Originally posted by agent46 View Post
      Yes, there is a very, very old provision contained in an Act (whose title escapes me) from the 17th or 18th Century that has never been repealed which provides that when T have served NTQ and does not give the LL vacant possession, then the LL is entitled to twice the rent for the period of occupation after the expiry of the NTQ. Other than that, I don't know a lot about the doctrine.
      I thought the OP was joking! This is pretty interesting - has there ever been a successful judgement entered against a T where they gave notice but then failed to move?

      Originally posted by agent46 View Post
      There is consideration as there was (in the contract) a mutual exchange of valuable promises - LL, "I will grant you an AST on 11th Aug" and, Your mate, "I will pay you rent and a deposit."
      I didn't realise that this was consideration - are you saying then that if two people promise to each other that something is going ahead then there is a contract created just by this?

      I believed from Jeffrey's post which I have copied below that there has to a deed, performance or money (put rather simply).

      From Jeffrey:
      For a contract to be valid under the law of England/Wales, there must be:
      a. an offer (whether to sell or to buy) from offeror; and
      b. an acceptance by offeree of that offer; and
      c. an intention to create contractual relationship.

      This intention is shown by:
      i. consideration (= money or something else of value passing in exchange for the subject matter); or
      ii. part-performance (usually unreliable as a basis for contract); or
      iii. embodying contract terms in form of a Deed. This third formality is treated as evidence that parties definitely intended to create legal relationship.

      I welcome your thoughts on this.

      Kind regards,

      John

      Comment


        #4
        Originally posted by MaverickPropertyManagemen View Post
        I thought the OP was joking! This is pretty interesting - has there ever been a successful judgement entered against a T where they gave notice but then failed to move?
        I remember having to look into this issue (as a peripheral matter) a while ago, but I can't remember whether there was any case law arising out of the Act. I would be very surprised if a provision that old and potentially contentious had not been litigated quite extensively though!

        Originally posted by MaverickPropertyManagemen View Post
        I didn't realise that this was consideration - are you saying then that if two people promise to each other that something is going ahead then there is a contract created just by this?

        I believed from Jeffrey's post which I have copied below that there has to a deed, performance or money (put rather simply).

        From Jeffrey:
        For a contract to be valid under the law of England/Wales, there must be:
        a. an offer (whether to sell or to buy) from offeror; and
        b. an acceptance by offeree of that offer; and
        c. an intention to create contractual relationship.

        This intention is shown by:
        i. consideration (= money or something else of value passing in exchange for the subject matter); or
        OP's case is an "executory contract" ie: a contract where performance takes place in the future. The exchange of valuable promises is the consideration.
        Health Warning


        I try my best to be accurate, but please bear in mind that some posts are written in a matter of seconds and often cannot be edited later on.

        All information contained in my posts is given without any assumption of responsibility on my part. This means that if you rely on my advice but it turns out to be wrong and you suffer losses (of any kind) as a result, then you cannot sue me.

        Comment


          #5
          Originally posted by agent46 View Post
          Yes, there is a very, very old provision contained in an Act (whose title escapes me) from the 17th or 18th Century that has never been repealed which provides that when T has served NTQ and does not give the LL vacant possession, then the LL is entitled to twice the rent for the period of occupation after the expiry of the NTQ.
          Yes. It's s.1 of the Landlord and Tenant Act 1730 (really; not a wind-up!)
          JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
          1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
          2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
          3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
          4. *- Contact info: click on my name (blue-highlight link).

          Comment


            #6
            Originally posted by agent46 View Post
            Yes, there is a very, very old provision contained in an Act (whose title escapes me) from the 17th or 18th Century that has never been repealed which provides that when T has served NTQ and does not give the LL vacant possession, then the LL is entitled to twice the rent for the period of occupation after the expiry of the NTQ. Other than that, I don't know a lot about the doctrine.
            Distress for Rent Act 1737

            18 Tenants holding after the time they notify for quitting, to pay double rent

            And whereas great inconveniences have happened and may happen to landlords whose tenants have power to determine their leases, by giving notice to quit the premisses by them holden, and yet refusing to deliver up the possession when the landlord hath agreed with another tenant for the same: from and after the said twenty fourth day of June one thousand seven hundred and thirty eight, in case any tenant or tenants shall give notice of his, her, or their intention to quit the premisses by him, her, or them holden, at a time mentioned in such notice, and shall not accordingly deliver up the possession thereof at the time in such notice contained, that then the said tenant or tenants, his, her, or their executors or administrators, shall from thenceforward pay to the landlord or landlords, lessor or lessors, double the rent or sum which he, she, or they should otherwise have paid, to be levied, sued for, and recovered at the same times and in the same manner as the single rent or sum, before the giving such notice, could be levied, sued for, or recovered; and such double rent or sum shall continue to be paid during all the time such tenant or tenants shall continue in possession as aforesaid.
            On some things I am very knowledgeable, on other things I am stupid. Trouble is, sometimes I discover that the former is the latter or vice versa, and I don't know this until later - maybe even much later. Because of the number of posts I have done, I am now a Senior Member. However, read anything I write with the above in mind.

            Comment


              #7
              heh

              That's great!
              ****************************************

              If you are unsure about what to do seek professional Legal advice.

              Comment


                #8
                Originally posted by agent46 View Post
                It is possible, and I do emphasise that I am only thinking off the top of my head, that, as performance of the contract has become impossible due to the act of a 3rd party, the Court may rule that the contract is "frustrated" and no damages will be payable.
                I feel sure that mature reflection will lead you to the conclusion that it cannot possibly be a case of frustration.

                This case serves as a warning to landlords never to sign up a new tenant until the old one as gone.

                Comment


                  #9
                  Originally posted by Lawcruncher View Post
                  I feel sure that mature reflection will lead you to the conclusion that it cannot possibly be a case of frustration.
                  Stop being a tease. Why can it not be frustration (I haven't got time to think about it properly)?

                  I suppose it might fall into the category of "impossibility of performance caused by a party to the contract", in that the LL may have been reckless in taking the T's NTQ at face value.
                  Health Warning


                  I try my best to be accurate, but please bear in mind that some posts are written in a matter of seconds and often cannot be edited later on.

                  All information contained in my posts is given without any assumption of responsibility on my part. This means that if you rely on my advice but it turns out to be wrong and you suffer losses (of any kind) as a result, then you cannot sue me.

                  Comment


                    #10
                    Originally posted by Lawcruncher View Post
                    I feel sure that mature reflection will lead you to the conclusion that it cannot possibly be a case of frustration.

                    This case serves as a warning to landlords never to sign up a new tenant until the old one has gone.
                    Yes. Even if L alleges frustration of contract, this is self-induced (because L contracted too soon with new prospective T).
                    JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                    1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                    2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                    3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                    4. *- Contact info: click on my name (blue-highlight link).

                    Comment


                      #11
                      Originally posted by jeffrey View Post
                      Yes. Even if L alleges frustration of contract, this is self-induced (because L contracted too soon with new prospective T).
                      Whilst this may be the most practical from a legal point of view, it is not really very practical in the world of lettings.

                      In the world of student lettings a student may easily sign up six months in advance, and whilst a S21 will be served there is no guarantee that the T's will actually leave. If everyone waited until the properties were vacant it would be absolute chaos.

                      In the same way a professional will give a months notice to terminate their contract, and even if a S21 is served on the same day they give notice, it will still be at least two months before that notice is effective.

                      Void periods would go sky high - I imagine most LL's are willing to take the risk of this happening rarely rather than to loose masses of rental income per annum.

                      Kind regards,

                      John

                      Comment


                        #12
                        I agree, but the world of lettings is susceptible to tenant indecision. L cannot be sure of the transaction before T actually moves in, if at all. Even embodying it in a Deed (avoids lack-of-consideration or future-consideration problems) never guarantees satisfactory commencement.
                        JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                        1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                        2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                        3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                        4. *- Contact info: click on my name (blue-highlight link).

                        Comment


                          #13
                          Originally posted by jeffrey View Post
                          I agree, but the world of lettings is susceptible to tenant indecision. L cannot be sure of the transaction before T actually moves in, if at all. Even embodying it in a Deed (avoids lack-of-consideration or future-consideration problems) never guarantees satisfactory commencement.
                          This hypothetical situation may be a little too vague to answer, but let's say that consideration can be proven along with a signed AST, is there any common reason why a court would not hold the T (who let's say hadn't moved into the property) responsible for honouring the contract.

                          I understand if there was no consideration or deed etc then the T would not be obligationt to fufil their contract but apart from that?

                          Or do you just mean practically you never know how things are going to go until they have actually happened?

                          Kind regards,

                          John

                          Comment


                            #14
                            Basically the law is over protective of tenants in occupation to the detriment of prospective tenants.

                            It is not practical for many landlords to wait till a property is empty and many tenants do not want to move in straight away because they have to give notice on their existing property.

                            Presumably it is rare for a tenant to change their mind otherwise the law would need to be changed. i would suggest that a tenant giving notice should make a stat dec so that the landlord could not invent the notice. Then it should be a criminal offence not to move by the time the notice runs out and a landlord could just go and change locks.

                            Comment


                              #15
                              It perhaps not the fault of the law but rather the length of time it takes to enforce it in these sorts of cases.
                              ****************************************

                              If you are unsure about what to do seek professional Legal advice.

                              Comment

                              Latest Activity

                              Collapse

                              Working...
                              X