Problems-Private Hsing Org Lease

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  • Problems-Private Hsing Org Lease

    Hi everyone. Am new here and would be really grateful for any assistance. Apologies for the length but Im including any detail that might help.

    We have had in place a three-year lease with a private landlords organisation who provides social housing to the Council. The Council have a lease with them, and they in turn have a lease with us, the landlord. They expressed their wish to renew at the end of the term and the lease expired June of 2006. The process of renewal according to them and confirmed by the council is that rental payments are, until new lease is in place, paid one month in arrears (as mesne profits) and a new lease is signed upon their receipt of all documentation required (valid certificates ie Corgi, NICEIC etc).
    Documentation has been sent to them but we are currently in the following position.

    1/ They will be five months in arrears, as of the end of this week.
    2/ They have still not sent us a copy of the new lease and will not tell us when they intend to do so.

    Their age -old excuse is that the council have not paid them but the council have v kindly confirmed to me that they have and up to date.

    In my attempt to try and resolve the matter myself, I am trying to find out the following.

    a/ What type of lease do we actually have with this organisation, and which tenancy laws, if any, govern such a lease? The lease itself has no title and is as a matter of course, provided by them to us, they accept no other lease/agreement. Below is their description, according to a 'frequently asked questions' leaflet which they gave us with the lease, the lease itself states nothing to this effect.

    "The lease we take from you and the sublease we give to the Council are not business tenancies under Part 2 of the Landlord & Tenant Act 1954. They are excluded from protection under that Act because neither we nor the council can occupy the property. Our leases expressly forbid us from doing so. This means that neither lease is protected by the Housing Act 1988 (as amended by the Housing Act 1996). This is because both are expressly excluded from being assured tenancies of any kind by the terms of that Act. This means that neither we nor the council can claim security of tenure under statute after the term of the lease expires if you do not want to grant us a new lease should we ask you for one."
    It also mentions that "The occupiers of the property occupy on a weekly only and temporary basis under the Non Secure Tenancy Agreements cntrolled b statute. They have no security of tenure as a result"

    b/ Where do we stand legally in view of the fact that the property is still being occupied by the one and only occupant since the beginning of the three-year term (although the organisation is technically our tenant as per the lease) and there is no new lease in existence and we are being owed 'mesne profits'? . . . Is this tenancy agreement/arrangement now, as is, recognised by law as a 'periodic tenancy'?
    The organisation have stated that although no lease is in place, their occupation is still covered legally by the existing yet expired lease. Is this the case? Surely a lease stating a fixed term is exactly that and only that?
    Under which, if any statute or law can I force them to pay up?

    Also, I have noticed by chance recently on their letter headed paper, that the organisations name has slightly changed, contact details the same. Could this be of any consequence in terms of any legal action I might want to take against them in the future?

    Many thanks for your thoughts.

  • #2
    Why are you awaiting document from them? Normally, it is L's solicitors (ie yours) who prepare and submit lease. If they have failed to provide it, and as they do not have business lease, they have - currently - no lease at all! After term expires, holding-over by T can create no more than a common-law tenancy at will.
    Change of name is not a problem, but change of status (or assignment of lease between linked parties) might be. Recommend that you take legal advice asap, seeing large rent arrears already clocking 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
    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).


    • #3
      Thanks for your response Jeffrey.

      The structure of this tenancy lease is based on a government scheme called Private Sector Leasing, organised by the government and run by local councils. As it's purpose is to provide social housing to families, it has to adhere to strict laws and regulations relating to issues such as safety, protection of the homeless etc.The contract that is then formed between the council and the private organisations who manage landlords & their properties and in turn theirs with the actual landlord have to reflect these legal requirements. The acceptance of the lease was based on the fact that the terms could therefore not be changed and was a case of 'take it or leave it'.
      My parents at the time thought it was a good deal as they were moving away for some time and would not have to deal with the day-to-day running of managing the property. They were given to understand that the organisation manage the property themselves and the landlord's only responsibility would be to carry out the property's maintenance as is required by law for most if not all tenancy agreements. The reality turned out to be quite different in fact in that effectively they only manage the occupants and the only positive aspect of the lease is that they (the organisation) would be committed to the property for the full term, whether empty or not (quite unlikely considering its purpose!) and even this part is flawed.
      The fact that my parents did not make an 'informed' decision at the time and that they have been a nightmare to deal with (serious communication issues, total disregard for the problems we have had when contractors have tried to gain access to the property to carry out the actual maintenance and more) is another issue.
      Something else that is a bit confusing . . .The council have told me that they have not YET renewed their lease with this organisation and yet they confirm that they are still paying them rent or mesne profits for the occupant in our property and as such, we have had a few payments made to us since the expiry but it's the balance since then and to date that we're chasing.

      So, before I seek legal advice, (eventhough the lease forbids us from doing so, however, I assume this does not now apply as it has expired), are you able to tell me how the law would term the status of a tenancy such as it is at the moment? You mention it may be a common-law tenancy. Are we in a position to serve any notice based on this (perhaps for possession) if we decide to do so? . . and on what basis could we claim mesne profits? As the organisation is our actual tenant and not the occupant, how would the occupant be removed when the notice, if any, would be served at the company's offices?

      In the lease, it states : "Re-entry: If the Rent hereby reserved or any part thereof, other than such rents as the Tenant shall be permitted to deduct under Clause * (relates to deductions for non-repair) shall remain unpaid for 28 calendar days after becoming payable [whether formally demanded or not] then the landlord may thereafter re-enter the Premise or any part thereof in the name of the whole and theeupon this Lease shall be forfeited and determine but not otherwise save in the case that the Tenant being a company is wound up"

      Do the terms of a lease still apply when rent or mesne profits continue to be accepted by a landlord and without a lease? As stated before, the organisation's position is that the terms of the lease still apply (a new lease is just a formality they say) and if this is legally the case, then can we, based upon the above clause (re-entry) then enter the property and forfeit the lease (even if it has expired)?
      The organisation will try and convince me of whatever suits their purpose, but can I myself found out what the law says?

      Any feedback would be very much appreciated, thank you.


      • #4
        I recall a thread here quite a few months ago from someone who was similarly disappointed with the PSL scheme because the tenants refused to leave and he hadn't expected it to be the landlords responsibility to undertake the legal eviction process. The council tried to assist him by offering the tenants other accommodation. However, his contract was directly with the council rather than through another party.

        Have i interpreted correctly your statement which indicates that you believe the contract forbids you from taking legal advice during the term of the tenancy or have I misunderstood? What does the clause actually say with regards to this?

        When does the original fixed term contract expire? Has the private company indicated whether they have served, or intend to serve, notice on the tenants in the property or whether this is your responsibility? Or is this the problem - they are not letting you know how to do this?

        Perhaps other posters will confirm how you can gain possession of the property and whether the arrears due could be addressed through civil means with the private organisation that you have the contract with in Court. For example, by taking them through the small claims process, if appropriate and it meets the criteria for this.

        However, if you are enquiring whether you can re-enter the property when the fixed term tenancy ends and the occupants are still in it, then I would caution against this as landlords may not enter a property without the permission and knowledge of tenants, even those with arrears who are staying beyond the tenancy agreement.


        • #5
          Hi Beeber.

          The clause dosn't state exactly that I'm forbidden to take legal advice, but forbiden to commence any legal proceedings (even worse) unless I go through mediation first. It's quite wordy so I won't bore you with all the details but in essence it states that:
          For issues relating to authorised deductions by the Tenant for dilapidations at the end of the term and non-compliance of the Landlord to carry out repairs during the term, both parties must agree on the appointment of a Chartered Surveyor. For oter disputes about the performance or breach of any obligations of the Landlord or Tenant under the lease, such disputes shall be referred to mediation appointed by the College of Mediators ad neither party shall be permitted to commence any legal proceedings relating to, arising out of or in any way connected with such a dispute whether directly or indirectly, until the appointed mediator has certified that mediation is unlikely to resolve the dispute between the parties.

          Looking at this closer however, I'm not wanting to dipute any issues about their conduct DURING the lease (although I have much reason to) and seeing as it applies only to the performance of either party DURING the term, which has now expired, and any legal proceedings I may want to take relate to non-payment of rent AFTER expiring of the term, this clause does't apply. Am I right? The issue here is, does the previous lease in fact still stand or not!

          The fixed term was for three years and ended last June of 2006. So the property has been occupied since then and still is, with only half the mesne profits paid to date and no new lease. This is the problem.

          The private company IS my tenant. It is with THEM that I have a lease and they provide the occupant. They would not want to serve any notice on their tenant (whom the council is responsible to house) as they would effectively be in breach of contract with the council. It is us who want to serve notice on our tenant (private company) for non-payment of rent and absence of lease.

          And what happens in terms of each of our responsibilities according to the lease (now expired)? Does the landlord still have to keep to his obligations but the tenant does not? Where do we stand in terms of the law?
          Basically, what are our rights when a previous lease has expired, no new lease exists, no more rent is being paid and the property is still occupied?
          We would be happy to take the issue to the small claims court but on what basis (type of tenancy) would I do this? Would it be on common-law tenancy grounds as Jeffrey mentioned could be the case?

          We have no intention of just throwing the occupant out as it's not their fault the private company are not paying their rent. I assume the responsibility is theirs to remove their own occupant. I am just looking for confirmation of this and some assistance in finding out what notice to serve on the private company.

          It is looking rather inevitable that we will have to consult a legal advisor anyway as it appears the law does not provide as clearcut a route or legal proceedings for a situation such as this as it does for Assured shorthold tenancies and similar agreements.

          Any further comments or light shed is welcome and many thanks indeed to all for input.


          • #6
            Having read your post i can find no landlord tenant relationship in existence, hence your confused thinking in the matter, indeed the contract you had with this organization seems to write them out. Therefore it would be pointless to look to these laws for assistants in this matter, if you have an action it would be in contract and or tort.

            From reading your post this organization seems to be employed as “principle agent” for the LA with no power to grant a tenancy, therefore the occupant is holding under a license with no interest in land. I would, if you can, get a statement from the occupant that they have been in continuous occupation from the end of the contract. Then find a lawyer who specializes in this area of the law.


            • #7
              Update . .. .

              The Council, with whom I am in regular contact of late, have today confirmed, in writing, that they will not now be renewing (with the private company/organisation) the lease for our property (hence neither will the private company with us) and are making arrangements to move the occupant from the property in the near future. They have also detailed again in writing all the payments that they have made to the company (the arrears still due to us from the organisation that they themselves stated they have not yet received from the council!) and confirm that they will continue to pay the organisation up until the date the occupant vacates. The Council have also expressed their interest in a new lease on the property once the current occupant moves out.

              This is a relief, I suppose, as we will no longer have to work with this particular organistion and all that remains now is to chase them for the arrears and manage the occupant's departure. I'm thinking that as they are aware of all the detailed information that has been coming from the Council (they have been copied into most emails) they may now actually cough up. I will write them one more letter and if I don't get a response in the next few days, I'll just go straight to a solicitor and sever contact with them completely.

              So, if anyone out there is ever interested in taking up a tenancy lease on their private property relating to a Private Sector Leasing scheme, please be aware of the following: Make sure the lease clarifies procedures and timescales relating to the renewal process and details of what your right's are if the process is delayed (as far as a lease will permit). Ours didn't . . . and definately ask a solictor to review the lease BEFORE you sign it so you understand exactly what you're in for. My parents didn't.

              Would I recommend it? . . . Yes, if you can have a lease that potects you more than this one did, in the event something goes wrong WITHIN the term. We had no problem with the occupant as such, they were good and clean tenants/occupants, at least to date! It was more with the organistion (middle man between us and the council) and nothing to fall back on in terms of the renewal process. As it was, the lease was very pro tenant and unfair towards the landlord. The purpose of the scheme itself works well. However, I would NOT recommend it if the terms of the lease cannot be altered at all.

              Thank you Bill for your post, I've taken all you've said on board. Thanks to everyone else too.


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