Help please? Extending non-AST agreement?

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    Help please? Extending non-AST agreement?

    Hi, I'm a landlord, new to this site. I wondered if anyone could advise me regarding a non-AST tenancy (annual rent is more than £25K) which is due to expire on the 7th July 2010. The original agreement started on 7th July 2008 and was extended by a formal agreement for a second year. Since then one of the 4 joint tenants left and a replacement took over from her by asignment. One of the other original tenants now wants to leave, but the others want to stay and find a new person to join them. Can anyone answer the following questions for me:

    1) Assuming the new tenant takes over by asignment, can I then extend the original tenancy with a further 'agreement to extend' or do I need to issue a new agreement (if only 2 of the original tenants are remaining?).

    2)In the latter case, would I have to return the deposit and take a new one?
    (I'm holding it myself because I believe it can't be in a protection scheme as it's not an AST - until October I gather when the law is changing).

    3) The tenants have suggested they'd prefer to have a periodic tenancy now with one month's notice either side, which I don't mind (they've been good tenants so far). How would I go about formalising that? Does a common law contractual tenancy like this automatically become periodic if the original agreement expires, like an AST? Or would we all have to sign an agreement to that effect?

    I'd be really grateful for your expert advice as I'm finding it hard to access information regarding non-AST agreements.

    Many thanks
    Pip

    #2
    Originally posted by pip View Post

    1) Assuming the new tenant takes over by asignment, can I then extend the original tenancy with a further 'agreement to extend' or do I need to issue a new agreement (if only 2 of the original tenants are remaining?).
    I don't know.

    2)In the latter case, would I have to return the deposit and take a new one?
    (I'm holding it myself because I believe it can't be in a protection scheme as it's not an AST - until October I gather when the law is changing).
    There have been a couple of threads lately where situations like this have caused a lot of confusion over the deposit (further complicated by deposit protection). Whatever you do, make sure that the departing T gets their share of the deposit back and the new T pays a new deposit, and that everything is clearly documented, with receipts given and taken, to avoid future confusion.

    It's possible the AST threshold rise may not go ahead if the new government decides to bin it; but there have been no announcements AFAIK.

    3) The tenants have suggested they'd prefer to have a periodic tenancy now with one month's notice either side, which I don't mind (they've been good tenants so far). How would I go about formalising that? Does a common law contractual tenancy like this automatically become periodic if the original agreement expires, like an AST? Or would we all have to sign an agreement to that effect?
    No, a statutory periodic tenancy will not arise with a bare contractual tenancy. You'd have to create a contractual tenancy by contract.

    From the sound of it, it would be easier to make a clean break, end the current tenancy and repay the deposit, then start afresh with a new deposit, new tenants and new contract.

    I also think it would be advisable to seek advice from a specialist landlord & tenant solicitor, rather than trying to DIY and crossing fingers you've got it right.

    Comment


      #3
      Greatly appreciated.

      Dear Westminster (are you the Duke of Westminster??),

      Thank you for this advice. I think starting afresh is the safest and best solution too.

      I suppose that there's no reason why a joint tenancy can't be 'assigned' to new tenants an indefinite number of times during its term. If each new tenant takes on all the obligations and rights of the departing tenant then in theory as landlord I can just return the deposit, less any deductable damages, to whoever's left at the end and it's up to them to sort out how to apportion it? But I wonder if, as Landlord, I have any responsibility in this situation?

      For instance, soon after moving in the original tenants broke the grill on the oven. They were reluctant to accept responsibility but it was working when they moved in (and noted as such on the inventory). I sent them a quote for the repair and they insisted they didn't want it done at that time. I informed them that it would have to be done anyway when they left and the cost would be deducted from their deposit. Whose responsibility is it to inform a 'replacement' tenant about this?
      If I don't - (I have) and the other tenants don't either - and she signs an assignment which indemnifies the departing tenant - then surely she's being treated unfairly? Who can be held to account for that?

      When you sell a house now you have a duty to declare any disputes with neighbours etc. Surely something similar should apply in rental situations?

      By the way thanks for clarifying that a contractual tenancy doesn't automatically become a statutory periodic tenancy. It's helpful to know that.

      Also I didn't realise that it was up to me to make sure that the departing tenant got their portion of the deposit back. I don't know how much each tenant contributed to the deposit to begin with. I presumed it would be sorted out between the departing and the replacement tenant - that's what the Deed of Assignment implies. But you're saying it's my responsibility?

      Best wishes
      Pip

      Comment


        #4
        Originally posted by pip View Post
        which is due to expire on the 7th July 2010. The original agreement started on 7th July 2008 and was extended by a formal agreement for a second year.
        No. If it began on 7 July and runs for a year, its last day is 6 July.
        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 westminster View Post
          No, a statutory periodic tenancy will not arise with a bare contractual tenancy. You'd have to create a contractual tenancy by contract.
          I agree. SPT arises only because of s.5 of the 1988 Act; and, here, none of that Act applies at all.
          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 pip View Post
            Dear Westminster (are you the Duke of Westminster??),
            I wish.

            ...For instance, soon after moving in the original tenants broke the grill on the oven. They were reluctant to accept responsibility but it was working when they moved in (and noted as such on the inventory). I sent them a quote for the repair and they insisted they didn't want it done at that time. I informed them that it would have to be done anyway when they left and the cost would be deducted from their deposit. Whose responsibility is it to inform a 'replacement' tenant about this?
            Another good reason to draw a line between tenancies. Sort it out as though it's a completely new tenant changeover. Get a check-out/check-in inventory carried out and charge the old Ts for any (interim) damage. Even if two Ts are the same on the new tenancy contract, legally it's an entirely separate entity.

            Also I didn't realise that it was up to me to make sure that the departing tenant got their portion of the deposit back. I don't know how much each tenant contributed to the deposit to begin with. I presumed it would be sorted out between the departing and the replacement tenant - that's what the Deed of Assignment implies. But you're saying it's my responsibility?
            No, you're not liable for returning the correct portion to individuals named as the tenant - 'the Tenant' may be four people but it's legally one entity. My previous comment was based on if you came to an arrangement whereby you didn't return 100% deposit to 100% tenant and start afresh (because things aren't always that straightforward - it may be that one of the joint tenants agrees for LL to keep their 'share' of the deposit to carry through to the new tenancy, etc).

            Comment


              #7
              HI Jeffrey,
              You must be so fed up because people are always making this obvious mistake about the length of a year (or month)! Sorry to be one of them. No excuses, specially as I have read lots of your previous posts pointing this common error out. It's odd because most people know a week begins on Monday and ends on Sunday or a day begins in the morning and ends at night...
              Pip

              Comment


                #8
                It's logic.
                A week is seven days. It ends at the last (imaginary) point of the day before the corresponding start day. Otherwise it would be more than seven days!
                So this applies to months and years too. To avoid 'end' problems, it's better to show only the term's start date ("On xxx") and length- not the end date.
                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


                  #9
                  Dear MRWestminster,

                  Well who wants all the responsibility of being the biggest landowner in the United Kingdom anyway? (Or does he come third after the Royal family and the Church of England?). You'd have no time to do fun things like giving people your valuable advice about thorny letting issues.

                  Thanks again.
                  Pip

                  Comment


                    #10
                    Originally posted by jeffrey View Post
                    It's logic.
                    A week is seven days. It ends at the last (imaginary) point of the day before the corresponding start day. Otherwise it would be more than seven days!
                    So this applies to months and years too. To avoid 'end' problems, it's better to show only the term's start date ("On xxx") and length- not the end date.
                    Ah - if only logic ruled the world! But then we wouldn't need lawyers . . .

                    Comment


                      #11
                      But we would still need laws and that its users bothered to read the relevant bits.
                      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


                        #12
                        Originally posted by pip View Post
                        Dear MRWestminster,
                        It's actually Miss Westminster

                        Comment


                          #13
                          Originally posted by westminster View Post
                          It's actually Miss Westminster
                          Not Baroness? No tiara, only a sash? You are Landlordzone Nobility anyway.

                          Comment

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