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APC > Landlord & Tenant > Flashcards

Landlord & Tenant Flashcards

1
Q

What is a tenancy at will?

A

A tenancy at will allows a tenant to occupy a property indefinitely, with both landlord and tenant able to end the agreement by giving immediate notice

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2
Q

What is a lease?

A

A contract between landlord and tenant giving the tenant rights of occupation for a period of time.

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3
Q

What is a licence?

A

A licence gives the landowner consent to someone to occupy land or carry out some activity on their property. It does not give rights over the land or premises and it is a personal consent that cannot be passed on to anyone else by either the licensee of licensor.

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4
Q

What is the difference between a licence and lease?

A

A licence does not give exclusive possession whereas a lease does.

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5
Q

Why are Tenancy at Wills used?

A

Generally used while more formal agreement is in place. There should be no specified date otherwise this could be interpreted as a lease.

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6
Q

What is the leading case law for tenancy at will?

A

Street v Mountford 1985.

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7
Q

What does Street v Mountford 1985 state?

A

A lease must grant exclusive possession for a fixed or periodic term at a rent.

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8
Q

What factors are to be considered when determining whether a “licence” could be a lease?

A
  1. Does the agreement grant exclusive possession.
  2. Is the agreement a fixed term.
  3. Is rent payable?
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9
Q

What are the different types of rent reviews?

A

Fixed increases Upwards only Upwards/Downwards RPI Index

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10
Q

What are the various options for a hypothetical term within a review clause?

A
  1. The unexpired residue
  2. The whole lease term
  3. The length of period between reviews
  4. A stated term of years
  5. An appropriate term having regard to market conditions.
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11
Q

If the hypothetical wording is ambivalent, what would the courts assumes?

A

The unexpired term to be most appropriate.

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12
Q

What is the definition of tenant’s improvement emanating from Woolworth & Co v Lambert 1937?

A

“an alteration to a property which improves the property from a tenants point of view even if this actually reduced the values of the landlords own interest”

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13
Q

What is the statement for comparable evidence?

A

Comparable evidence in Real Estate Valuation RICS 1st Edition October 2019

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14
Q

What does the RICS comparable statement define the word comparable as?

A

An item of information used during the valuation process as evidence.

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15
Q

Good/reliable comparable evidence consists of what?

A

Comprehensive Similar to the SP Recent Arms-length Consistent with local market practice The result of underlying demand

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16
Q

What problems might you face in collating comparable evidence?

A

Limited number of transactions
Lack of up-to-date evidence
Special Purchasers
Lack of similar evidence
Lack of transparency of deals

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17
Q

What is compulsory purchase?

A

A legal mechanism by which certain bodies can acquire land without the consent of the landowner.

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18
Q

What are the sources of comparable evidence?

A

Market evidence
Indices
AVM’s

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19
Q

What are Indices?

A

Real estate market indices are derived from aggregate information about market values or transactions.

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20
Q

What is the most common indices?

A

The longest established is MSCI which produces indices covering capital and rental movements, yields and investment returns.

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21
Q

What are AVM’s

A

Automated Valuation Models.
software that combines Mathematical or statistical modelling with databases of existing properties and transactions to calculate yields.

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22
Q

What is the order of Hierarchy of evidence?

A

Open market transactions
Arm’s-length renewals or rent reviews
Expert Determinations
Arbitrators awards
Lease renewal determined in Court
Hearsay

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23
Q

What does Without Prejudice mean?

A

Cannot be relied on in court.

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24
Q

What is dispute resolution?

A

A procedure to resolve conflicts between parties.

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25
Q

What is ADR.

A

Alternative Dispute Resolution. A procedure to avoid litigation.

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26
Q

What is Litigation?

A

The process of taking legal action through the courts.

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27
Q

What are the benefits of ADR?

A
  1. Cheaper & quicker than litigation
  2. More flexible than Court
  3. Generally specialists who has property knowledge.
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28
Q

What is the correct RICS application for a rent review dispute?

A

DRS1 application.

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29
Q

What does S30 of LTA 1954 relate to?

A

Grounds of opposition

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30
Q

What does S24 of LTA 1954 relate to?

A

Continuation of a tenancy.

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31
Q

What section under LTA 1954 covers interim rent?

A

S24a - d

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32
Q

What is S25N?

A

A notice served by the landlord either hostile or non-hostile.

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33
Q

What is a S27 notice

A

A notice to quit.

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34
Q

How long does the the landlord have to respond to a S26N?

A

2 months.

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35
Q

What are the S30 grounds of opposition?

A

a) a breach of repairing covenant
b) persistent delay in rent
c) another substantial breach
d) LL can offer suitable accommodation
e) the tenancy was created via a sublet
f) LL wants to demolish/redevelop
g) own occupation for LL

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36
Q

When can an application be made for interim rent?

A

Any time after the service of a S25 or S26 notice but no later than 6 months after the relevant tenancy has terminated.

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37
Q

What are the three ways a tenancy can be terminated?

A
  1. Forfeiture
  2. Surrender
  3. Notice to quit.
38
Q

When is the tenant entitled to statutory compensation?

A

When the LL opposes on ground (e), (f) or (g) only.

39
Q

How much statutory compensation does the tenant receive?

A

1x the Rateable Value of the property or 2x the Rateable Value if the tenant has been in occupation longer than 14 years.

40
Q

What are the O’May principles?

A
  1. The onus is on the party proposing a change to the terms of the existing lease to justify the reason, which must be based on essential fairness between the parties.
  2. There is no obligation to modernise the lease and it will not be sufficient to show that the proposed term is in line with current market practice.
  3. The court will compare the advantage afforded to the proposing party and consider whether the detriment suffered by the other party may be compensated in monetary terms.

4.The general purpose of the 1954 Act should be taken into account, which is to protect the comparatively weak negotiating position of the tenant.

5.The court must be satisfied that the proposed departure from the existing terms is fair and reasonable, taking the above considerations into account.

41
Q

What was the procedure before Landlord and Tenant (covenants) Act 1995?

A

The first tenant remained liable for the rent, etc throughout the term of the tenant regardless of assignment

42
Q

What is Privity of Contract?

A

In the context of business tenancy, means the first (original) tenant can assign his interest in the tenancy but not his relationship with the landlord

43
Q

What is PACT

A

Professional Arbitration on Court Terms.
- ADR for unopposed lease renewals
- parties agree which points are to be decided by the 3rd party
- requires consent from both parties
- legally binding

44
Q

What parts of the 1954 Act govern PACT?

A

Section 29 - order by Court for new tenancy
Section 32-35 - terms of new tenancy

45
Q

What is the general approach to a lease renewal?

A
  • am I competent?
  • conflict of interest?
  • terms of engagement
  • review the lease, licences, deeds
  • inside the Act?
  • inspection
    -market research
  • serve notices if applicable
  • negotiation
  • documents
46
Q

What does section 23 of the LTA 1954 relate to?

A

Application of the Act

47
Q

What does section 24 of the LTA 1954 relate to?

A

Continuation of tenancies (holding over)

48
Q

What does section 24a of the LTA 1954 relate to?

A

Interim rent

49
Q

What does section 25 of the LTA 1954 relate to?

A

Landlords notice to terminate (hostile or non hostile)

50
Q

What does section 26 of the LTA 1954 relate to?

A

Tenants request for a new tenancy

51
Q

What does section 27 of the LTA 1954 relate to?

A

Tenants notice to quit

52
Q

What does section 28 of the LTA 1954 relate to?

A

Renewal of tenancies by agreement

53
Q

What does section 29 of the LTA 1954 relate to?

A

Order by court for grant of new tenancy

54
Q

What does section 30 of the LTA 1954 relate to?

A

Grounds of opposition

55
Q

What does section 32-25 of the LTA 1954 relate to?

A

Terms of new lease

56
Q

What does section 34 of the LTA 1954 relate to?

A

Basis of valuation for the new rent

57
Q

What does section 37 of the LTA 1954 relate to?

A

Compensation for tenant

58
Q

What does section 38a of the LTA 1954 relate to?

A

Agreement to contract outside the Act

59
Q

What does section 40 of the LTA 1954 relate to?

A

Notice requesting information about either party

60
Q

What does section 44 of the LTA 1954 relate to?

A

Meaning of the landlord

61
Q

What is the general approach to a rent review?

A
  • am I competent
  • conflict of interest?
  • terms of engagement
  • leases, licences etc
  • is time of the essence?
  • inspection
  • market research
  • negotiations
  • rent review memo
62
Q

What dispute resolution is there for rent reviews?

A

Depends on the lease. This will generally state whether an arbitrator or independent expert should be appointed. Following this make a DRS1 application at a cost of £425 plus VAT

63
Q

Would you rather an independent expert or arbitrator acting for tenant/landlord in an upwards/downwards market?

A

In a falling market for tenant, an independent expert.

In a rising market for tenant an arbitrator.

64
Q

What is an Arbitrator?

A
  • appointed 3rd party
  • governed by Arbitration Act 1996
  • format includes at SOAF and timetable for submission
  • can only award a rent within the parties valuations
  • can appeal an award to high court on three grounds: challenge a tribunal decision, points of law and serious irregularity
65
Q

What is an Independent Expert?

A
  • appointed by RICS but not bound by judicial rules
  • can determine a rent outside the valuations
  • cannot appeal a determination
66
Q

Key difference between an Arbitrator and Independent Expert?

A

Evidence - Arbitrator bound by evidence submitted, expert not
Appeal - appeal arbitration to high court on three ground, cannot with expert
Disclose - arbitration has powers, expert doesn’t
Law - Arbitration Act 1996. Expert governed by lease
Outcome - Award and Determination
Costs - arbitrator has power on all costs, expert only their own costs

67
Q

What is a Calderbank offer?

A

A settlement offer which is marked ‘without prejudice save as to costs’ and is brought to the attention of the court after the judgement has been given, and when issue of costs is being considered.

It must detail a time limit (usually 3 weeks).

68
Q

What is a Part 36 offer?

A

A settlement offer that can be made at any stage in a dispute up to the beginning of the trial.

It must be:-
- in writing
- state that’s it’s intended to have the consequence of Section I of Part 36 (Civil Procedure Rules)
- state a period not less than 21 days. Defendant liable for claimants cost if accepted

69
Q

What is the difference between a Calderbank and Part 36 Offer?

A

Calderbank offers greater flexibility as it is not governed by strict court rules

Calderbank offer creates a binding contract if accepted

Part 36 offer is always open for acceptance up to the start of the trial

70
Q

Can you appeal an expert determination?

A

No but you can sue them for negligence

71
Q

Can you appeal a Arbitrators Award?

A

3 grounds:
- Tribunal Jurisdiction
- Points of law
- Serious irregularity

72
Q

What is the effect of a S40 notice and when can it be used?

A

Used for finding out information from opposing parties, can be used to check who the competent LL or T is. Can be served in the last 2 years and must respond within 1 month of the notice

73
Q

Excluding the rent review clause, What lease terms would you consider for a rent review?

A

Repairing obligations
Alterations
Security of tenure
Service charge cap
User clause

74
Q

What is the maximum term a court can insist upon when deciding a new term at lease renewal?

A

15 years

75
Q

Define time is of the essence

A

The need for timely completion

76
Q

What is a competent LL?

A

Covered by S44 LTA 1954. It defines it as the person/body whom a notice should be served in or whom should be serving notices. Must be the freeholder or the superior tenant who has an unexpired term of 14 months

77
Q

What terms can affect rent payable at review?

A

Lease length, security of tenure, break clause, RR Provisions, user clause, alienation, passing rent and alterations

78
Q

What does the 1954 Act not apply to?

A

Agricultural tenancies and licences

79
Q

What are the key points of acting as an expert witness?

A

Evidence must be impartial and objective
Duty is to the court
Evidence must be independent work of the surveyor

80
Q

What are the assumptions and disregards at lease renewal?

A

Assumptions
- Vacant possession
- willing L and T
- Any effect on rent of the operation of LTA 1954 must be considered

Disregards
- Tenants occupation
- Goodwill
- Tenants improvements (unless older than 21 years)

81
Q

What do you mean by onerous provisions? Please give me an example

A

Tenant cannot assign or sublet

Hypothetical term being 15 years when actual reality is 5 years

82
Q

What is a reversionary lease?

A

A lease that takes places at a future date (usually at the expiration of the existing lease)

83
Q

What is a day 1 rent review and what are the advantages?

A

Using B&M Burnley as an example, the tenant took assignment in August 2012 of a lease expiring July 2016. In conjunction, they agreed an 8 year reversionary lease to commence from the day of existing lease expiry.

They also agreed that a rent review on day 1 (I.e. July 2016). This was however linked to RPI and subject to a cap. This benefitted B&M as they knew the maximum rent that would be payable and could therefore forecast accordingly.

In other instances, an upwards/downwards mechanism is common at day 1 rent reviews as it ensures the tenant will not be paying above market rent when the future date comes.

84
Q

Why did you serve a Calderbank offer at B&M in Burnley?

A

This was a final offer of settlement, which if not accepted would be provided to the Independent Expert when deciding as to their own costs

85
Q

What details were within the rent review memo for B&M in Burnley?

A

The date
Current and original Landlord and
Property address
Tenant details
Lease date
Review date
The agreed rent
Both parties signature

86
Q

ScS Fenton - what is the problem with evidence pertaining to unrepresented occupiers?

A

This evidence is not too reliable as it is likely that the tenant does not have a exclusive knowledge of market evidence and therefore potential agree a rent that was above the evidence at that point.

87
Q

ScS Fenton - What DRS application did you submit?

A

DRS1 application

88
Q

ScS Fenton - What are replies?

A

Replies are made to comment on the opposing party’s report.

The document will acknowledge points referred to for clarification

89
Q

What is a Competent Landlord?

A

A landlord that has at least 14 months unexpired interest in the property so is in a position to grant or oppose renewal of occupational tenancy.

If they want to oppose renewal on ground G then they must have owned the property for at least 5 years.

90
Q

What are the 5 principles of property law?

A
  1. Right of possession
  2. Right of control
  3. Right of exclusion
  4. Right to derive income
  5. Right of disposition

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