Signing AST in advance; is signature needed at all?

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    #16
    A legal estate can only be created by deed. If a tenancy is granted by deed it takes effect from the date specified in the deed, unless the start date precedes the date of the lease, when the start date is the date of the lease.

    A tenancy agreement for a term of three years or less is a binding contract to grant/take a tenancy. It is binding on both parties whether made by deed or not and can indeed be made orally. It is, in legal terms, an executory contract. When such a tenancy agrement is entered into, the tenancy does not start until the tenant goes into possession.

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      #17
      Please sir, I understood it better with all the nots in it
      'Pause you who read this, and think for a moment of the long chain of iron or gold, of thorns or flowers, that would never have bound you, but for the formation fo the first link on one memorable day'. Charles Dickens, Great Expectations

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        #18
        Originally posted by Lawcruncher View Post
        A legal estate can only be created by deed. If a tenancy is granted by deed it takes effect from the date specified in the deed, unless the start date precedes the date of the lease, when the start date is the date of the lease.

        A tenancy agreement for a term of three years or less is a binding contract to grant/take a tenancy. It is binding on both parties whether made by deed or not and can indeed be made orally. It is, in legal terms, an executory contract. When such a tenancy agrement is entered into, the tenancy does not start until the tenant goes into possession.
        Yes, so, if the agreement is not by deed and (for example) the prospective tenant fails to take up possession then the landlord must seek a court order compelling the other party to comply. Not a prospect which most landlords would relish, I imagine.

        So, if either party wishes to avoid this possibility, still best to be done by deed isn't it?

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          #19
          Thank you Legal Eagles. I believe that you have now offered a comprehensive and relatively tangle free answer to the question originally posed. It has improved us lay-people's understanding of this facet of the law.
          (Naturally my reply contains disclamers!)

          P.P.
          Any information given in this post is based on my personal experience as a landlord, what I have learned from this and other boards and elsewhere. It is not to be relied on. Definitive advice is only available from a Solicitor or other appropriately qualified person.

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            #20
            Originally posted by Preston View Post
            Yes, so, if the agreement is not by deed and (for example) the prospective tenant fails to take up possession then the landlord must seek a court order compelling the other party to comply. Not a prospect which most landlords would relish, I imagine.

            So, if either party wishes to avoid this possibility, still best to be done by deed isn't it?
            There are two different things here:

            1. A contract to create a tenancy

            2. When the tenancy starts

            You are not going to get a court order requiring the tenant to take up occupation. If you have a contract the rent is still payable even if the tenant does not take up occupation. You can sue for breach of contract. The contract does not need to be by deed.

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              #21
              Originally posted by Lawcruncher View Post
              There are two different things here:

              1. A contract to create a tenancy

              2. When the tenancy starts

              You are not going to get a court order requiring the tenant to take up occupation. If you have a contract the rent is still payable even if the tenant does not take up occupation.
              Maybe not, although of course its possession that's required to create a tenancy rather than occupation.

              Originally posted by Lawcruncher View Post
              You can sue for breach of contract. The contract does not need to be by deed
              Again, that may well be the case, depending upon how the contract has been put together, but surely what the landlord is after is a tenancy and the rights and responsibilities which go with it, rather than simply a potential obligation to pay some form of compensation under a contract (presumably the compensation cannot be rent if there is no landlord and tenant relationship?)

              I attended a training course a while ago and I know this is an issue that has troubled the Law Commission sufficiently for it to recommend that oral and other agreements which fail to comply with the statutory requirements should come into effect when the agreement is made, even if entry into possession is delayed.

              I don't have access to the full judgement as I am not in the office this week, but from memory the judgement in Long v Tower Hamlets London Borough Council [1996] called into question the generally held view that tenancy agreements could be signed in advance of the tenancy without using a deed.

              My real point is a simple one. I don't doubt any of your legal reasoning, but the OP asked whether an AST should be witnessed and given the potential to introduce doubt and confusion by not doing so, it would seem sensible to create an AST by deed if the parties intend to sign the documents before the tenant enters into possession.

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                #22
                Originally posted by Preston View Post
                its possession that's required to create a tenancy rather than occupation.
                The difference between possession and occupation is rather technical, and, even to those experienced in property law, often rather elusive and hard to grasp.

                Huseyin Akici -v- LR Butlin Ltd

                Technically you are right. It is possible to have possession without occupation and being in occupation does not amount to possession if you do not have an interest in the property or have effective control over it. However, in the case of ASTs it is difficult to see how occupation is not going to amount to possession in almost every case.

                Originally posted by Preston View Post
                presumably the compensation cannot be rent if there is no landlord and tenant relationship?
                This happens to me sometimes. I think about making a point and decide not to to keep a post short. Then someone pops up and makes the point...Again, technically you are probably right. However, what the landlord is entitled to is a sum equivalent to the rent and so for practical purposes it is the same thing.

                Originally posted by Preston View Post
                I attended a training course a while ago and I know this is an issue that has troubled the Law Commission sufficiently for it to recommend that oral and other agreements which fail to comply with the statutory requirements should come into effect when the agreement is made, even if entry into possession is delayed.
                Lots of things trouble the Law Commission. Sometimes the things that trouble the Law Commission do not trouble anyone else. Regrettably, they are often responsible for new laws that change the law when no change was needed and end up sowing confusion.

                Originally posted by Preston View Post
                I don't have access to the full judgement as I am not in the office this week, but from memory the judgement in Long v Tower Hamlets London Borough Council [1996] called into question the generally held view that tenancy agreements could be signed in advance of the tenancy without using a deed.
                I have found a summary of the case here:

                http://www.lawteacher.net/cases/land8.htm/file-70.php

                I do not think that it is necessarily "the generally held view that tenancy agreements could be signed in advance of the tenancy without using a deed", but rather that a written tenancy agreement (by which we presumably mean for a term of three years or less and not made by deed) does not create a tenancy. It is simply an agreement for a tenancy (hence its name). This does not mean that there is never a tenancy. The tenancy arises when the tenant goes into possession.

                Originally posted by Preston View Post
                My real point is a simple one. I don't doubt any of your legal reasoning, but the OP asked whether an AST should be witnessed and given the potential to introduce doubt and confusion by not doing so, it would seem sensible to create an AST by deed if the parties intend to sign the documents before the tenant enters into possession.
                If you are right that a contract in writing to create a tenancy (rather than a lease in writing that actually creates a tenancy) for three years or less must be by deed then:

                1. You would have the oddity that a lease for three years or less can be created orally, but not agreed in writing unless by deed; and,

                2. Contracts for leases for more than three years would have to be by deed, which would surprise many lawyers, if not all of them.

                If two parties sign an agreement which says: The landlord will let and the tenant will take 23 Acacia Avenue Newtown for a term of one year from 1st May 2009 at a rent of £500 per month that is a contract that binds both. It does not create a legal estate, but one will arise as soon as the tenant goes into possession.

                If two parties sign an agreement which says: The landlord will grant to the tenant and the tenant will accept a lease of 23 Acacia Avenue Newtown for a term of ninety nine years from 1st May 2009 at a rent of £5 per year that is also a contract that binds both. The difference is that no legal estate will arise if the tenant goes into possession if the contract is not completed by the execution of a deed granting the 99 year term. However, provided the tenant goes into possession, his position will not be hopeless as he can rely on the doctrine in Walsh v Lonsdale; he will have an equitable lease which will only bind a purchaser of the landlord's interest if he has notice of it.

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