Landlord & Tenant

Question 1

Talk me through the Egale 1&2 entrance door example

Answer 1

• Tenant contacted me advising the entrance door to their unit was not opening and closing properly.
• I reviewed the lease which confirmed the door was within their demise and they were therefore responsible for the repairs

Question 2

Where did you look in the lease to determine the responsibility of the door at Egale 1 &2?

Answer 2

The unit demise definition – stated all doors and widows exclusive to their unit are tenants responsibility to maintain and repair.

Question 3

What happened when you told the tenant it is their responsibility to maintain and repair the door at Egale 1&2?

Answer 3

As I referenced the relevant lease clause, they confirmed they would arrange a repair. We provided the contact details of our contracted maintenance team who invoiced and liaised with the tenant directly to complete the works.

Question 4

What type of lease does the tenant have at Egale 1&2 that the door is their responsibility?

Answer 4

Effective FRI – responsible for the insurance and interior maintenance only. However costs to the structure can be recovered through the SC.

Question 5

How would you have acted differently if the door was not their responsibility?

Answer 5

I would have instructed the door to be repaired as an urgent job due to safety issues if it was not closing correctly.

Question 6

How long did it take for the tenant to repair the door at Egale 1&2?

Answer 6

It was repaired that same week.

Question 7

What options would have been available if they did not repair the door at Egale 1&2?

Answer 7

Best option would be to carry out works and recharge tenant under Jervis v Harris clause
Potential for S.146 notice although that is an aggressive approach.

Question 8

How did you communicate in the Egale 1&2 entrance door issue?

Answer 8

Through emails and phone calls

Question 9

Did you inspect to check the repair had completed at Egale 1&2?

Answer 9

Not immediately, but I spoke with the contractor who carried out the work and they confirmed it was fixed. I attended site the following month and inspected myself.

Question 10

Talk me through the Glasshouse Yard break notice example

Answer 10

• Tenant served notice to determine. I reviewed the notice and confirmed its validity.
• I advised my Client and recommended hat solicitors also review. They too confirmed its validity.
• I suggested to my Client that we instruct building surveyors to prepare a schedule of dilaps.
• I inspected on the break date to ensure all conditions had been satisfied, namely vacant possession.

Question 11

How did you confirm the validity of the break notice at Glasshouse Yard?

Answer 11

Reviewed the conditions within the lease and inspected on the break date.

Question 12

Are you competent to confirm the break notice at Glasshouse Yard was valid?

Answer 12

Yes however I would always recommend that solicitors review to protect the clients position and ensure validity

Question 13

What were the conditions in the Glasshouse Yard break notice?

Answer 13

Notice served on 6 months written notice to the Landlords address
All sums due under the lease paid on the break date
Vacant possession on the break date

Question 14

How did you ensure the conditions in the Glasshouse Yard break notice were satisfied?

Answer 14

Reviewed their account, the break clause in the lease and inspected on the break date

Question 15

If the conditions were not satisfied, what would you have recommended to the Client?

Answer 15

I would have advised the Client that the break was invalid

Question 16

Can you give me some case law examples on break notices ?

Answer 16

• Osborne Assets vs Britannia Life – tenant covenanted to paint internally with 3 coats of paint every 5 years – invoices showed only 2 coats and the break was ineffective
• NYK Logistics v Ibred Estates – tenant had not competed SoD work prior to expiry and workmen remained in the unit for an additional week – no vacant possession provided and break ineffective

Question 17

Talk me through the lease renewal at Unit 29 Bourne Industrial

Answer 17

• I advised my Client that the contracted in lease was due to expire in 6 months. They confirmed their intentions.
• I measured and inspected the unit to ascertain market rent and discussed with my Client their rental and lease expectations.
• I recommended that solicitors be instructed to serve a friendly S.25 notice as the unit was under-rented.
• New 5 year lease was agreed following negotiations and comprehensive HOTs filled out to make legal drafting easier

Question 18

Why did you only advise the Client 6 months before the lease end date at Unit 29 Bourne industrial? What are the dates available?

Answer 18

As I had recently taken on management. I’m aware notice should be served 6-12 months before lease expiry or suggested new lease start date.

Question 19

How did you ascertain whether the tenant at Unit 29 Bourne was contracted in?

Answer 19

I reviewed the lease

Question 20

How did negotiations go at Unit 29 Bourne Industrial? Did you have to concede anything?

Answer 20

Very successful. Reduced rent by £2,000 compared to the market rent of £35,000 ascertained

Question 21

What was the market rent you ascertained at Unit 29 Bourne Industrial?

Answer 21

£35,000

Question 22

If Unit 29 Bourne Industrial was over-rented, how would your advice have changed?

Answer 22

It wouldn’t have changed. Could have suggested to not serve notice and tenancy would continue under S.24 however, in a falling market, it was best to serve notice as soon as possible to lock in at the current market rate.

Question 23

What were the other lease terms agreed at Unit 29 Bourne Industrial?

Answer 23

5-year term and other lease details same as previous lease.

Question 24

How did you ascertain the market rent at Unit 29 Bourne Industrial?

Answer 24

Comparable method

Question 25

Talk me through the rent review at Compass House

Answer 25

• Client instructed me to act on the upcoming rent review. I reviewed the lease and familiarized myself with the RR clause. This clarified the assumptions and disregards and RR mechanism.
• Time was not of the essence and it was an open market review. I inspected and measured the unit, gathered comparable evidence and confirmed with local letting agent.
• I determined a suitable market rent and discussed expectations with my Client.
• I contacted the tenant to begin the RR negotiations and once the rental level was agreed, I instructed solicitors to draft the RR memo.

Question 26

How did you initiate the rent review at Compass house

Answer 26

Simply by contacting the tenant which acted as a trigger notice

Question 27

What were the assumptions at Compass house RR

Answer 27

Assumptions:
A letting on a new lease on the same terms as this lease
Hypothetical 5 year term
Property is vacant and available for immediate occupation
No work has been carried out to diminish value of premises
All requirements complied with

Question 28

What were the disregards at Compass house RR

Answer 28

Disregards:
Goodwill
Lawful improvements
Occupation

Question 29

What was the rent review mechanism at Compass House

Answer 29

Open market

Question 30

What was the ADR available at the compass house rent review?

Answer 30

Independent expert – at least 10 years qualified and experienced
Can awards costs in this instance

Question 31

Whats the advantages and disadvantages of independent expert vs Arbitrator in a RR?

Answer 31

Arbitrator can award costs and IE cannot. Therefore if IE, no point in serving Calderbank

Question 32

What was the market rent at Compass House?

Answer 32

£750,000

Question 33

How did negotiations go in the Compass House rent review?

Answer 33

Client minimum rental level was £750,000 which was achieved. Started negotiations at £775,000 and discounted £25,000 due to condition of premises and to avoid ADR.

Question 34

How did you determine whether time was of the essence in Compass House Rent review

Answer 34

It was not expressly stated in the lease – United Scientific Holdings vs Burnley Borough Council

Question 35

Time of the essence case law?

Answer 35

United Scientific Holdings Vs Burnley Borough Council 1977
Cheapside Land and Development vs Messels Services 1977
Bello vs Ideal View 2008 (RR not initiated for 13 years but allowed to go ahead as time not of the essence)

Question 36

If you could not agree on a rental level, what would the outcome have been?

Answer 36

Independent expert – appointed by president of RICS if cannot agree on a rent review surveyor

Question 37

Why is it beneficial to agree on a rental level and is it worth conceding in some areas of the negotiation?

Answer 37

To avoid ADR – in this case, independent surveyor is able to award costs as stated in the lease. Maintains good landlord and tenant relationship and avoids additional costs to landlord.