Landlord and Tenant Lvl3 Flashcards
What is a Lease?
A lease is a legally binding contract which grants the lessee with an estate in the land or property. The lease sets out the terms and conditions and right and obligations of the tenancy.
What is a Licence?
A licence is an agreement which grants permission for the licensor to use the land or property.
What is the difference between a Lease and a Licence?
- A lease grant the occupier with an estate in the land / property. A licence does not
- A lease can be assigned. A licence can not
- A lease is difficult to terminate. I licence can be revoked easily
- A lease can give right to renewal. I licence does not
- Street V. Mountford 1985
What are some landlord covenants?
- Repair and maintain
- Insure premises
- Rebuild in the case where the building has been damaged / destroyed
- Give peaceful enjoyment
What are some tenant covenants?
- Repair and maintain
- Pay all liabilities
- To not create a nuisance
- Vacant possession on the cessation of the lease
What are some clauses?
- User clause
- Exclusivity clause
- Keep open clause
What does “contracted out” mean?
Renounced rights under L&T 1980/94
What is tenancy at will?
Occupied at the will of the landlord. Short term. Still allows exclusive possession
What is assignment of the lease?
Assignment of the lease is a legal process where the entirety of the lease is transferred from one party to another. The assignee assumes all responsibility for the performance of the lease post assignment whilst the assignor is absolved of performance.
What is subletting?
Subletting is where a tenant enters into their own sub-agreement of part or whole of the demise. Tenant is still liable for the performance of the lease
Can I landlord refuse assignment or subletting
No a landlord cannot unreasonably withhold a request for either
When can a landlord refuse an assignment/ sublet?
- Doesn’t align with landlord’s commercial goals
- Assignee is not of appropriate covenant
- Disruption to existing tenancy mix
- Inappropriate user
- Effect insurance
What is the process for requesting an assignment /Sublet?
Initial Steps
- Review lease
- Seek landlord permission
- Prepare information
Formal Application
- Assignment / Sublet Agreement - Outlines the transfer
- Application to landlord - Formal application to L/L containing assignment agreement/ assignee info and other relevant documentation
- Negotiation - Landlord will negotiate specific clause
What is the process of terminating a lease as a tenant?
- Surrender - Tenant hands back leasehold interest in the property prematurely
What are the four requirements for a lease?
- Exclusive Occupation
- Payment of rent
- Duration for a specified term
- Terms in writing, signed and registered as a deed
Can a wayleave be transferred to another company?
No, it is personal to the company
What is a wayleave?
- Temporary right to access
- Receives annual payment
- Electricity company to install / service equipment
What does a wayleave look like on an ordinance survey map?
Wayleaves are often shown as lines on the map. The line thickness and style might vary, but they are usually distinct from property boundaries.
Labels are crucial for identification. An wayleave might be labeled with its purpose (e.g., “Right of Way”, “Drainage Easement”), beneficiary (e.g., “ESB Wayleave”), or reference number.
What is an easement?
- Permanent right of way
- Over the land of another party
- Capital compensation
Can an easement be registered at the land registry?
Yes
What can be claimed as a result of continued and uninterrupted use over 20 years?
Prescriptive right of way
What impact does “Without Prejudice” have during a period of negotiations?
- Discussion from that point onwards cannot be used as evidence
- Allows parties to negotiate free from compulsion
- Cannot be shown to arbitrator / independent expert if express in review
What is subject to contract?
- Offer is subject to other terms and conditions being met
What needs to be agreed at the start of an instruction?
Terms of Engagement
What should you understand in terms of your clients?
- Commercial objective
- Strategy
What documents should be obtained for a rent review?
- Copy lease
- Plans attached to lease or Deeds of Variation
- Copies of any licences e.g. alterations, improvements, sub-letting or assignment
- Copies of rent review memorandums
How would you arrange an inspection?
Obtain contact details of tenant or agent
What should be agreed in terms of serving notices?
Confirm who is responsible for serving
What should you check before issuing terms of engagement?
- Competent
- No personal interest of conflict
What is the rent review process?
- TOE
- Clients objectives
- Review lease, contract out, RR clause
- Time of the essence?
- Check notice requirements and time limits for implementing RR
- Inspect and measure
- Compile comps and analyise comps
- Value in accordance with the lease
- Report to client and agree strategy
- Negotiate
- Settle/ Refer to 3rd party - Review ADR clause
- Document and instruct solicitors
- Invoice
- Note next lease event
What is contained in a rent review notice?
- Refer to lease
- Party details
- Property address
- Note specific clause allowing review and state review date
- Proposed new rent (confirm)
- Timeline for response if one is applicable.
What are some standard RR assumptions?
- Hypothetical term
- Open market
- Willing parties
- Fit for immediate occupation
- User stated in lease
- Vacant possession
What are some standard disregards?
- Goodwill
- Improvement
- Occupancy
- Inducements
How do you activate 3rd party Arbitration / Independent Expert
- Consult lease
- “Demand for arbitration”
- “Notice of dispute”
What has the Arbitration Act 2010 brought in?
- Modernised and improved arbitration in Ireland
- Adoption of the UNCITRAL Model Law (International Best Practice)
- Recognition and enforcement of international arbitration awards
- Streamlined procedures
- Clarity on arbitrator immunity
- Improved confidentiality
- Repeal of previous legislation (54/98)
What is difference between Arbitrator and Independent Expert?
- Role - Arbitrator resolves dispute with a legally binding decision / Independent Expert provides and expert opinion on an issue
- Process - Arbitrator bound by arbitration act and common law. They base there decision on the cases presented by both parties / Conducts their own independent investigation, may involve consultation with both parties
- Authority - Arbitrator issues a final and binding award / Independent Expert issues their determination, not legally binding
- Appointment - Both are normally appointed by the involved parties of President of the SCSI
- Expertise - Arbitrator may not posses expert skills in the particular field / Independent Expert possesses expert skills in the particular field
- Other - Arbitrator can request discovery and award costs / Independent Expert cannot.
What are the grounds for challenging an award?
- Serious irregularity - Biased/ Denial of fair hearing
- Award being in conflict with public policy - Contradicts fundamental legal policy
- Error of law on the face of the award - Clear mistake in applying the law
- Award procured by fraud or corruption
Extremely hard to challenge due to the finality of the award.
What are the primary L&T Acts, and what are their significance
L&T 1860 (Deasys Act)
- Lease is a contract
- Longer than 1 year needs to be in writing
L&T (Ground Rents) 1978
- Section 9/ 10 sets out right yo obtain the fee simple
L&T 1980
- Right to renew
- Defined business and tenement
- Section 66 outline L/L cannot unreasonably withold request to assign / sub or improve
- Comp for Distirbance / Improvement
L&T 1984
- Increased right for sporting tenants / leases
L&T 1994
- Business equity increased form 3 - 5 years
- 4 Yr 9 month leases
- DOR for Office
- Changed the length of the term requested to 5 - 20 yrs
Civil Law Mischelanious Provisions Act 2008
- Section 47 allowed for all to sign DOR
- Tenant must receive legal advice prior to signing
Land and conveyancing law reform act 2009
- Ban on upward only rent reviews from 28th Feb 2010
Arbitration Act 10
- Flexibility
- Confidentiality
- Speed
- Expertise
- Enforcability
Residential Tenancies Act 2019
- Notice period increased from 90 - 180 days
- Annual Registrations
- RTB determinations are published on website
- Greater powers to RTB to investigate breaches in regulation
- Penalties for improperly increasing rent
What are tenants’ rights to renew?
Business Equity (5 Yr/ 5-20 yr)
Long Term Equity (Fixed at 35 yr)
Improvement Equity (Value great than half rental value)
Restrictions to new tennancy
Repudiatory breach
Planning to redevelop
Good Estate Management
What is compensation for disutrbance
When a tenant has a right to claim a new lease but it is ultimately rejected.
How would you value compensation for disturbance
Compensation for any financial loss incurred with relocation
Payable 1 month from date of agreement
1/3 tenant liabilities + removal & disconnection costs + disruption to business
Where is right for compensation for disturbance obtained
Section 4 L&T 1980
When can a tenant claim compensation for improvement
Entitled to payment for improvement made on the tenement
Improvement must add to letting value and is suitable character
Notice to improve must have been served
Not entitled is lease is terminated due to surrendered or unpaid rent
Entitled if lease is terminated for any other breaches of covenant
How would you value the contirbution
Value asset with and without.
Difference is the value attributed to the improvement
What is a DOR
Tenant is renouncing rights to a new lease under L&T 1980 / 1994.
Established in 1994 and Civil Law Mischelanious Provisions Act 2008
What is a side letter
Letter of comfort
Used to clarify terms and grant concessions
Cannot be assigned
What are ground rents
Rents paid by the tenant for the land, only where the tenant has built the building they occupy themselves and the landlord owns the land.
Who is able to purchase the Fee Simple and what is the purpose
Tenant who holds land by way of a proprietary lease
Need to serve and S4 Notice outlining intention to purchase
Section 9/ 10 of L&T 1978 set out requirement
What are the requirements to acquire the fee simple
Permanent building on land
Building cannot be an improvement
Cannot be constructed in contravention of the lease
Must comply with Section 10 of the act: building must have been erected by the tenant
What is a tenement
A tenement consists of a land covered wholly or partially by building. If partially covered, the land is considered subsidiary and ancillary to the building. Tenement must be held by the occupier by lease or contract
What is a lease regear
Renogiating the lease during the term.
Often extension of tenants’ commitment either by removal of break clause or extension of term.
In exchange for rebasing the rent or other market incentives.
What is yielding up
Sets outnconditions on which the property is to be handed back.
What are main contents of a lease
Date
Parties
Demise
Guarantor
Tern
Rent
Landlord and tenant covenants
Rent review clause
Break clause
User clause
Alienation clause
Maps
Outgoings
Repair clause
Definitions
Schedules
What are the three types of leases in relation to the repair of the property
Full reparing and insuring (FRI)
Internal repair and insuring (IRI)
Internal repairing (IR)
What is a break clause
A mechanism within a lease that allows for either party to prematurely terminate the lease prior to the contractual expiry
What is a user clause
A clause detailing out the permitted use of the demise.
What is alienation clause
Clause which details out right to assign/ sublet
Why do landlords not like sublets below passing rent
Can set market precedent
If head lease is forfeited, rent is stuck at lower amount
What is Promissory Estoppel
Legal doctrine that prevents someone from going back on a promise
Requires promise / reliance and detriment
If your client needs a tenant out of the building during the lease, what would you advise?
Read lease
Are they in breach of any covenants
If so, you may have ground for forfeiture.
If not, you will have to consider a lease surrender and premium
If the same tenants lease expired, how would your advice change
Review lease
Is there a DOR in place
If so, serve notice to quit and take back possession.
If not, serve notice to quit and see of the tenant claims relief.
Can refuse on various grounds
You have a retail tenant on high Street at the end of a long lease, you are acting for the landlord, what do you advise?
Review lease
DOR?
Lease performance
Suggest that if tenant want to stay, they serve and notice of intention to claim a new lease
How do you remove a tenant for breach for terms
breach of covenant (Exc. Rent)
- Section 14 Notice
- Outline Breach
- The remedy
- Compensation
For non payment of rent
- Letter would suffice demanding possession
- Can re-enter peacefully
- If you cannot re-enter peacefully then the landlord mus issue and ejectment civil bill on titles executed by the local sheriff/ Country registrar
What is a CPO
- Allows for local authorities purchase land for Public Infrastructure Projects that are considered for the greater or common good.
- Landholders should be compensated and should not be in a worse off position as a result
What is the process of CPO
- L&T 1919 & 63
- Affected parties served notice along with newspaper notice
- Objections on planning or legal grounds
- Public enquiry
- Minister confirms
- Acquiring authority then serves notice to treat (within 18 months(
- Discussions re compensation
What is a notice to treat?
- Fixes valuation date for comp
- Defines extent of the property subject to CPO
- Issues time limits
What would an affected party be entitled to? (CPO)
Severance - Damage caused by taking strip of land
Injurious Affection - Additional damages caused by the new use of CPO lands
Pointe Gourde Principle - Compensation not tied to new scheme as a result of the CPO
Edward Principle - If scheme does not directly use your land then you are unable to reject injurious affection
What factors are considered when determining value for CPO
- Value of land
- Diminution of the retained land
- Costs associated and fees
- Disturbance
- Loss of goodwill and profits
- Relocation costs
If CPO cannot be agreed, how is it dealt
- Referred to Land Values Reference Committee
- Similar to rent review hearing
- Governed by arbitrations act
- Two state appointed arbs
What are all third party roles for valuers
- Valuer
- Negotiator
- Expert Witness
- Advocate
What is the valuer
- After securing instructions, the valuer provides the client with their opinion of market rent in accordance with the lease terms
Negotiator
- Negotiates without prejudice basis with the valuer acting on the behalf of the counter party in an attempt to secure the best possible deal
Expert Witness
- If matter proceeds to third party, the valuer adopts the role of expert witness. Duty of care to the court
Advocate
Represent client, may disclose only what they wish as their duty of care is to client
What is a tenancy at will
- No longer a tenancy under Land and conveyancing law reform act 2009.
- Holding land for an indefinite period of time under the will of the landlord
- Normally no rental payments
- Terminated at ease
What is Tenancy of sufferance
- No longer a tenancy under Land and conveyancing law reform act 2009
- Lowest form of tenant
- Tenant remain in situ
- No Assent or Dissent from landlord
- No statutory rights
What is an express tenancy
Express tenancy may arise when
- Lease expressly states that the tenant can remain in situ after the expiry of lease, provided rent is paid.
- Fixed term now a periodic tenancy
- Normally dependent on payment of rent
What is an implied tenant
- Tenant remains in situ post expiration
- Not apart of original agreement
- Will depend on implied agreement
- If rent is paid then accepted, then tenancy may be implied
What are some cost items for compensation for disturbance
- Loss of profit / Goodwill
- Pro Fees
- Cost to seek new premises (agent)
- Cost in securing new premises (Stamp Duty)
- Moving costs
- Staff costs
- Force sale of stock
What is precis of evidence
- Intro
- Submission / Declaration of truth
- Location
- Demise
- Lease details
- Factors effecting value
- Comps
- Basis of valuation
- Opinion of value
- Statement of agreed facts
What are effected parties entitled to in CPO
Severance
Injurious Affection
Pointe Gourde Principle
Edward Principle
Principle of equivalence
What factors are considered in determining the level of compensation for CPO
Value of land
Diminution of retained lands
Cost associated and fees
Disturbance
Loss of goodwill and profits
Relocation costs
If failure to agree CPO, what happens
- Application to Land Values Referene Committee
- 14 days after notice to treat
- 2 state appointed arbitrators
- Similar to Arbitration
What is fixed price contract
The contract is fixed at a price. If costs go over, the contractor must cover.
What is collateral warranty
Third party can sue a contractor, architect, or engineer in the event they have purchased a building that proves to have a defect. Required by developers and lending institutions.
What is the process for taking back possession at the end of the lease?
- Serve notice to quit
- Tenant has 3 months to serve intention to claim relief
- Apply to the circuit court 1 month after receipt
What Acts govern residential in Ireland
Residential Tenancies Act 2004 - Landlord / Tenant Obligations / Rent Regulation / Security of Tenure (Part 4)
Planning and development (housing) and residential Tenancies act
What is the process for a breach in residential
- Identify breach
- Communication and Notice
Informal: Speak to tenant, outline breach and request rectification in timeframe
Formal notice: If breach persists, issues formal written notice specifying breach and consequences
Review RTB website as they have templates
Dispute resolution
Courts
What legislation covers ground rents
L&T 1967 - Introduced basic rights
L&T 1978 - Right to purchase expanded
L&T 1984 - Method of calculation
What is the requirements to purchase
Section 9
- Permanent building / Land ancillary
- Cannot be an improvement
- Cannot be constructed in contravention to lease
- One alternative from Section 10
Section 10
- Building must have been erected by entitled person under lease
- Term no longer than 50 yrs
- Lease was granted by a lessor to the nominee of a the builder
What if you cant find the superior landlord
- Apply to county registrar
- Certificate issued
- Purchase price paid to the court
What are commercial rates
Property tax on commercial property, in exchange for the use of public services
What legislation covers commercial rates
- Valuation Act 2001
- Valuation (Amendment) Act 2015
- Local government and reform act 2014
Tell me about the Valuation (Amendment) Act 2015
- Amended 2001 act for the provision of valuation lists
- Lists ensure calculations are correct and uniform
- NAV - Estimated annual rental income
How are commercial rates calculated
- Rateable valuation is set by the valuations office
- Local authorities set the multiplier and collect rates
- Dublin City .277
What are the three key rate assumptions
- Occupation is exclusive
- Occupation must be value of benefit to the occupier
- Occupation must not be temporary
