Three-year AST; no break clause; use Deed of Surrender?

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    Three-year AST; no break clause; use Deed of Surrender?

    Hi,

    This is a terrific website, been great reading. Want to become an active member and share my experiences.

    I am a tenant with a rather serious and headscratching issue that has even confused potential legal reps! Long story but I'll give the main points clearly to save on preamble.
    • Signed a 1yr Fixed Term contract in mid-2005. Deposit paid in full.
    • Contract was Assured Shorthold Tenancy, direct to Landlord. His solicitor prepared the contract.
    • No issues after one year, Fixed Term lapsed into a Periodic Tenancy
    • Three and a half years after moving in, contacted Landlord by email stating that we are enjoying living there, but minor upgrades required (such as bathroom tiling) in order for us to continue tenancy.
    • Landlord visited December 2008. Verbally stated and agreed that we are likely to stay for another 18 months, we had plans to marry and have kids. Larger place required.
    • Landlord agreed to upgrade agreed areas, with agreement to a moderate rental increase. We agreed. He stated a new AST needs to be prepared so he can declare the rent.
    • Jan 2009 - new AST arrives, states new rent. Trust Landlord, we've only ever gone direct and not AST experts. We signed and return.
    • As discussed Dec 2008, I issue Notice to leave Jan 2010 as relocating to a different part of the country in Mar 2010. Two months notice.
      • Three weeks later, Landlord after advice from solicitor informs me we signed a 3 year (!) Fixed Term AST. No Break Clause. Not what we discussed, abused our trust, although we were niaive to trust, even after 3.5 years of quiet enjoyment.
      • I informed Landlord he has abused our trust, this was not verbally agreed, upgrades to premises had not taken place (although they were not agreed in writing), and that he should do the right thing and let us go. New job, no choice.
      • Landlord puts flat up for sale. Month goes by with no good result, flat not in best presentation as boxes etc packed prepared for move. Landlord says he will surrender lease upon sale of property. He will not tell me his acceptance price.
      • Moved out March 2010, relocated elsewhere in UK. Landlord provided reference. Signed us out of property, took signed responsibility of Utilities, c/tax etc. I handed keys over. I am still liable for the rent until a Contract of Sale is agreed.


    At the end of the day, he could still hold out until Dec 2011, if he isn't happy with sale price.

    He will not return deposit. I am now aware he did not secure my deposit in an authorised deposit protection scheme. Given the deposit was paid in 2005, but a renewal Fixed Term AST was signed in Jan 2009, by law he must declare it.

    Now, I am in tricky situation. Landlord unaware of the deposit scheme situation. I plan to get married in August, this has cost me a fortune already paying for two places for two months. Next months rent due. Flat not sold despite Landlord's assurances the flat has been redecorated and presented for sale.

    Do I demand return of deposit? Withold rent? Threaten court proceeedings iro deposit protection scheme? To me, any threat prejudices his right to demand any asking price he sees fit for the flat.

    I feel so powerless. The rent is just shy of £1,000. I cannot afford to take on legal advice to take this on properly!

    Complex one, just would like eyes and ears - any support appreciated.

    Many thanks

    #2
    Originally posted by SwS View Post
    • Landlord puts flat up for sale. Month goes by with no good result, flat not in best presentation as boxes etc packed prepared for move. Landlord says he will surrender lease upon sale of property. He will not tell me his acceptance price.
    • Moved out March 2010, relocated elsewhere in UK. Landlord provided reference. Signed us out of property, took signed responsibility of Utilities, c/tax etc. I handed keys over. I am still liable for the rent until a Contract of Sale is agreed.


    At the end of the day, he could still hold out until Dec 2011, if he isn't happy with sale price.

    He will not return deposit. I am now aware he did not secure my deposit in an authorised deposit protection scheme. Given the deposit was paid in 2005, but a renewal Fixed Term AST was signed in Jan 2009, by law he must declare it.....Flat not sold despite Landlord's assurances the flat has been redecorated and presented for sale.
    I'm afraid you cannot blame the LL for the fact that you signed a 3 year fixed term contract. You should have read it before signing.

    However, I think it's possible that the landlord's actions comprise a surrender by operation of law (google it).

    But also see
    http://nearlylegal.co.uk/blog/2009/0...eet-surrender/

    Handing back the keys isn't, in itself, sufficient, but the fact that the LL took over responsibility for the council tax and redecorated the flat is wholly inconsistent with a continuation of the tenancy.

    Do I demand return of deposit? Withold rent? Threaten court proceeedings iro deposit protection scheme? To me, any threat prejudices his right to demand any asking price he sees fit for the flat.

    I feel so powerless. The rent is just shy of £1,000. I cannot afford to take on legal advice to take this on properly!
    I wouldn't advise you to pursue deposit non-compliance claim. They are not dealt with in the small claims track and can be easily defeated.

    I would, however, withhold the rent and call LL's bluff and if he pursues you for rent claim surrender by operation of law (gather evidence of LL's actions which show he's 'taken over'). You have nothing to lose insofar as if you lose, you just have to pay the rent you'd otherwise have had to pay (note that if you pay off a CCJ within 30 days and obtain a certificate of satisfaction, the CCJ won't be recorded on your credit history).

    You can get free advice at Shelter, CAB, or a community law centre.

    Comment


      #3
      Originally posted by SwS View Post
      Hi,

      This is a terrific website, been great reading. Want to become an active member and share my experiences.

      I am a tenant with a rather serious and headscratching issue that has even confused potential legal reps! Long story but I'll give the main points clearly to save on preamble.
      • Signed a 1yr Fixed Term contract in mid-2005. Deposit paid in full.
      • Contract was Assured Shorthold Tenancy, direct to Landlord. His solicitor prepared the contract.
      • No issues after one year, Fixed Term lapsed into a Periodic Tenancy
      • Three and a half years after moving in, contacted Landlord by email stating that we are enjoying living there, but minor upgrades required (such as bathroom tiling) in order for us to continue tenancy.
      • Landlord visited December 2008. Verbally stated and agreed that we are likely to stay for another 18 months, we had plans to marry and have kids. Larger place required.
      • Landlord agreed to upgrade agreed areas, with agreement to a moderate rental increase. We agreed. He stated a new AST needs to be prepared so he can declare the rent.
      • Jan 2009 - new AST arrives, states new rent. Trust Landlord, we've only ever gone direct and not AST experts. We signed and return.
      • As discussed Dec 2008, I issue Notice to leave Jan 2010 as relocating to a different part of the country in Mar 2010. Two months notice.
        • Three weeks later, Landlord after advice from solicitor informs me we signed a 3 year (!) Fixed Term AST. No Break Clause. Not what we discussed, abused our trust, although we were niaive to trust, even after 3.5 years of quiet enjoyment.
        • I informed Landlord he has abused our trust, this was not verbally agreed, upgrades to premises had not taken place (although they were not agreed in writing), and that he should do the right thing and let us go. New job, no choice.
        • Landlord puts flat up for sale. Month goes by with no good result, flat not in best presentation as boxes etc packed prepared for move. Landlord says he will surrender lease upon sale of property. He will not tell me his acceptance price.
        • Moved out March 2010, relocated elsewhere in UK. Landlord provided reference. Signed us out of property, took signed responsibility of Utilities, c/tax etc. I handed keys over. I am still liable for the rent until a Contract of Sale is agreed.


      At the end of the day, he could still hold out until Dec 2011, if he isn't happy with sale price.

      He will not return deposit. I am now aware he did not secure my deposit in an authorised deposit protection scheme. Given the deposit was paid in 2005, but a renewal Fixed Term AST was signed in Jan 2009, by law he must declare it.

      Now, I am in tricky situation. Landlord unaware of the deposit scheme situation. I plan to get married in August, this has cost me a fortune already paying for two places for two months. Next months rent due. Flat not sold despite Landlord's assurances the flat has been redecorated and presented for sale.

      Do I demand return of deposit? Withold rent? Threaten court proceeedings iro deposit protection scheme? To me, any threat prejudices his right to demand any asking price he sees fit for the flat.

      I feel so powerless. The rent is just shy of £1,000. I cannot afford to take on legal advice to take this on properly!

      Complex one, just would like eyes and ears - any support appreciated.

      Many thanks
      Firstly you must have been barking mad not to read the contract, the term will be present on the first or second page and so you should have seen it, but I guess you know this

      I would ask the question to the expert on the forum though, I recall a contract over three year has to done by deed, but does that mean three year and over? or a contract up to three years does not need to be registered?

      Comment


        #4
        Here's s.54 of LPA 1925; a lease for up to and inc. three years can be oral*. Only a lease for over seven years needs to be registered.
        *- 'by parol' means 'by words only', = oral.

        54. Creation of interests in land by parol.

        (1) All interests in land created by parol and not put in writing and signed by the persons so creating the same, or by their agents thereunto lawfully authorised in writing, have, notwithstanding any consideration having been given for the same, the force and effect of interests at will only.

        (2) Nothing in the foregoing provisions of this Part of this Act shall affect the creation by parol of leases taking effect in possession for a term not exceeding three years (whether or not the lessee is given power to extend the term) at the best rent which can be reasonably obtained without taking a fine.
        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


          #5
          Originally posted by jeffrey View Post
          Here's s.54 of LPA 1925; a lease for up to and inc. three years can be oral*. Only a lease for over seven years needs to be registered.
          *- 'by parol' means 'by words only', = oral.

          54. Creation of interests in land by parol.

          (1) All interests in land created by parol and not put in writing and signed by the persons so creating the same, or by their agents thereunto lawfully authorised in writing, have, notwithstanding any consideration having been given for the same, the force and effect of interests at will only.

          (2) Nothing in the foregoing provisions of this Part of this Act shall affect the creation by parol of leases taking effect in possession for a term not exceeding three years (whether or not the lessee is given power to extend the term) at the best rent which can be reasonably obtained without taking a fine.
          OP a bit stuck then as T is looking to sell which is an unknown event at some point in the distant future rather than re-let which would be usual route to surrender. My guess OP need to negociate a price to terminate and call off the wedding to pay for it... painful lesson

          Comment


            #6
            Thanks for your responses. As I said, LL hit me with a contract that was completely against our discussions after 3.5 years tenancy. Ludicrous that I'd want to be handcuffed for another 3 years without option to leave. He stressed new contract was merely to reflect rental increase.

            I am in a profession where I deal with contract and responsible for them. He abused our trust entirely. But, I am adult enough to know that ignorance of the law is not an excuse. I read the contract, but I did not seek legal advice as I presumed uncessary. I did not know that an AST had to state a break clause - and that we would be unable to serve notice without one.

            Lesson learnt, but I am living with my mistake with my pocket.

            LL now playing the victim, hitting me with threats of legal action should I default. I take offense. I know my duty, I pay in full and on time as I have done for 5 years, and continue to do so. Talking £1k a month, not mere change.

            I cannot afford to take him to court and accuse him and his co-owner of lying and leading us into unfair contract.

            I have accept ignorance is not an excuse. How is it fair then that given the LL has not protected my deposit 15 months after he should have done, get away with it clean if I threaten legal action? ie - he can turn up in and give me a cheque 5 mins before the court hearing.

            The law stinks and yet again in favour of immoral LL. I have attempted to negotiate fairly but he's ruthless, behind his crack team of solicitors, emphasising I am at fault. But there he stands flauting the law - on the deposit, and complete lack of annual gas safety checks for 5 years may I add, and yet he demands that I adhere to it strictly.

            I have prove on all matters also, not merely allegations.

            Comment


              #7
              Originally posted by SwS View Post
              LL now playing the victim, hitting me with threats of legal action should I default....
              I cannot afford to take him to court and accuse him and his co-owner of lying and leading us into unfair contract.
              Your defence is not the 'unfair' contract - you may have been tricked into signing it but that doesn't make it unfair. It was your responsibility to read it or show it to a solicitor if you didn't understand it, before signing it.

              Your defence is that there has been a surrender by operation of law - did you READ the case report I linked to above?

              Either the tenancy is continuing or it isn't. There is no in between. If the tenancy is continuing, then why is the landlord paying the 'tenant's' bills, and entering and redecorating mid tenancy? These acts are inconsistent with a continuation of the tenancy.

              If you win the case, the landlord will have to pay your legal fees. Ask around and find a solicitor who is prepared to act for you on a conditional fee arrangement (no win, no fee).

              Comment


                #8
                Thanks, Westminster.

                Advice much appreciated. I did read!it, and have read similar cases also.

                What is key that the LL drew up an endorsement to the AST stating that all bills now fall under responsibility of the LL, including council tax, but that I continue to be responsible for the rent until he agrees a Contract of Sale. I signed this endorsement. It is the lesser of two evils as otherwise being liable for everything would have truly been unnaffordable. Apologies for not making this clear, as I said from the outset, not the easiest of cases.

                The endorsement however isn't well drafted, make no mention of property involved, tenants involved, what contract it refers to etc. Nowhere does it state that even though I have handed over keys and responsibility, that my rights under the original contract are null and void. Still, as I said, lesser of two evils for me.

                Eg - In the rush to move, a lot of stuff, regardless of importance, was left in the loft. We had to leave it behind. Is the LL merely allowed to dispose of this without informing me first?

                Seems a conflict of interest here, weighed heavily in the favour of the LL.

                Worth noting that any CCJ brought against me, even if sucessfully removed, will result in a immediate termination of employment. LL knows that thanks to his solicitor informing him - he smarmily told me such. He is correct, but he's enjoying rubbing my face in the fact.
                A lot here, I really do again appreciate thoughts - open to advice and critisism also, trust me, lessons being learnt!

                Comment


                  #9
                  OMG - I can't believe that you signed an endorsement confirming that you would continue to pay the rent!!

                  Surely it is worth getting some professional legal advice to see if there is anyway you can get out of this. You say you can't afford it, but if you don't get proper advice you could possibly face a £20,000 rental bill between now and the end of the contract. The advice you get may get you out of this obligation (or substantially reduce it) and therefore must be money well spent?

                  Comment


                    #10
                    Q: might the 'endorsement' fail to be valid, if unsupported by contractual consideration?
                    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 SwS View Post
                      Eg - In the rush to move, a lot of stuff, regardless of importance, was left in the loft. We had to leave it behind. Is the LL merely allowed to dispose of this without informing me first?
                      No, he is not.

                      Worth noting that any CCJ brought against me, even if sucessfully removed, will result in a immediate termination of employment.
                      Okay, but it seems somewhat strange that your employment prevents you from seeking justice in a civil court.

                      Here's an alternative idea. Though I don't think that endorsement you signed is necessarily enforceable, proceed on the premise that the tenancy is continuing as landlord claims, and ask for your keys back in writing. (Keep a copy and get proof of posting).

                      If they refuse to return the keys, that's a clear indication that the tenancy has ended OR you could use it as evidence of illegal eviction. Report Landlord to the local authority (it is they who prosecute for illegal eviction) - show them the letter asking for the keys, and the tenancy agreement, and tell them the LL is refusing to give you access.

                      If they do return the keys, then immediately get the locks changed (you are within your rights to do this, so long as you keep the original lock and reinstate at the end of the tenancy).

                      Then, refuse LL access for viewings (again, you are within your rights to do this, as you have exclusive possession of the property, and the right to quiet enjoyment). Remember, you have the endorsement saying LL will pay the bills, so if he has the electricity cut off, say, then report to the local authority for illegal harassment.

                      Basically, the idea is to encourage the LL into committing either illegal eviction/harassment, because then it is not you who would be risking a CCJ, but the LL risking a criminal prosecution by the local authority.

                      Alternatively, the lack of access for viewings will put you in a stronger position to negotiate a formal surrender of the tenancy.

                      Comment


                        #12
                        Originally posted by jeffrey View Post
                        Q: might the 'endorsement' fail to be valid, if unsupported by contractual consideration?
                        The current situation appears to be that LL claims the 'tenant' is still liable for rent, but the 'tenant' has handed back all his rights. He's paying rent for nothing in exchange - as you say, no contractual consideration.

                        In OP's position I would immediately stop paying rent, and be confident of winning any claim the LL made. Indeed, I would counterclaim for rent already paid after the tenancy was, arguably, surrendered by operation of law.

                        But, apparently, OP's work disenfranchises him of the right to legal remedies available to everyone else.

                        Comment


                          #13
                          Thanks, Westminster. Stressful situation and your thoughts are much appreciated. Great points, I will have a serious think about the options suggested and seek immediate legal advice before proceeding. I will update you throughout to keep you informed. It will be an interesting case if nothing else!

                          It goes without saying, huge lesson learnt. Never trust, even after 3.5 of almost "friend" terms with LL - but, at the end of the day, business is business.

                          I work in a regulated financial position where my contract of employment states any CCJ, insolvency results in immediate dismissal. I could inform and explain situation to employers, but a supportive response isn't something I can assume.

                          As I said, many thanks again. Legal advice being sought and I will report back throughout with updates.

                          Comment


                            #14
                            It is unfortunate that you continued to pay rent after leaving as that may prejudice your case. Apart from that, what you have told us (and there may of course be some important detail you have not mentioned) suggests a surrender by operation of law.

                            I think you should stop paying rent and immediately demand repayment of all rent you have paid since leaving on the basis that it was paid under a mistake. You should also check if the landlord is advertising the property for sale with vacant possession or has relet. If he is/has, that should be conclusive that there has been a surrender.

                            Comment


                              #15
                              Quick update:
                              • Rent will not be paid going forward, standing order cancelled. I can explain previous payment as the due date was same as sign-out date, so too late to cancel standing order.
                              • I requested copies (by email) of signed endorsements, twice in the last week. LL has refused in writing to provide until property sold. Can I use this non-compliance to my advantage? Or do I simply write to him, with proof of sending, stating he must provide within 7 days?


                              Early legal advice has reinforced your comments. There is no contractual consideration with the endorsements and deemed unenforceable by law, with respect to the actions of the landlord taking full responsibility and occupation of the premises.

                              Comment

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