Landlord & Tenant Flashcards
What does LTA 1927 cover?
Covers improvements by tenants and compensation.
What does LTA 1954 govern?
Governs security of tenure and lease renewal rights.
What does LTA 1988 regulate?
Regulates landlord’s response to tenant applications for assignment.
What did the L&T (Covenants) Act 1995 abolish?
Abolished privity of contract, affecting lease assignments.
What is an Alienation Clause?
Governs a tenant’s right to assign, sublet, or share occupation.
What is alienation?
The transfer of a leasehold interest to another party (assignment, subletting).
What is the RICS Code for Leasing Business Premises?
Promotes fairness, transparency, and flexibility in lease negotiations.
What terms should you look for when summarising a lease?
Term, rent, break clauses, repair obligations, service charge, alienation rights, rent review provisions.
What is the Regulatory Reform (Business Tenancies) (England & Wales) Order 2003?
Simplified procedures for contracting out of security of tenure under LTA 1954.
What is the role of an expert witness?
Provides independent, unbiased expert opinion in legal proceedings.
How does the role of an expert witness change from negotiations?
In negotiations: Advocate for client’s interests. As expert witness: Impartial and duty-bound to the court/tribunal.
How does an advocate differ from an expert witness?
Advocate argues a position; expert witness provides independent opinion.
What is an arbitrator?
Acts in a quasi-judicial role, following arbitration law.
What is an expert?
Makes a binding determination based on experience.
How do an arbitrator and expert’s roles differ?
Arbitrator follows legal procedures; expert relies on professional judgment.
How would you establish the relevant third-party procedure for a rent review?
Check lease terms for dispute resolution clauses (arbitration/expert determination).
How much does it cost to submit an RICS DRS application?
Circa £425 + VAT (subject to review by RICS Dispute Resolution Service).
What is the difference between the hypothetical lease at a rent review and lease renewal?
Rent Review: Assumes a hypothetical lease based on lease terms. Lease Renewal: New lease agreed under LTA 1954 Part II.
What is PACT?
Professional Arbitration on Court Terms (PACT) allows parties to agree lease renewal terms via arbitration/expert determination instead of court.
How do in and out of Court PACT differ?
In Court: Tribunal supervises proceedings. Out of Court: Parties appoint an arbitrator/expert.
What is a Calderbank offer?
Without prejudice settlement offer to encourage negotiation and reduce legal costs.
What is a break clause?
Allows early termination of a lease by landlord or tenant, subject to conditions.
What is a S25 Notice under the LTA 1954?
Landlord notice to terminate or renew lease.
What is a S26 Notice under the LTA 1954?
Tenant request for lease renewal.
What is interim rent?
Rent payable between lease expiry and renewal resolution, determined by court/negotiation.
What is the Court procedure at lease renewal?
Claim issued, evidence exchanged, negotiation encouraged before hearing.
What are the Civil Procedure Rules?
Court rules governing litigation, including lease renewal disputes.
What are the Jackson Reforms?
2013 cost-control measures for litigation, including fixed costs and case management.
What is a Part 36 offer?
A formal settlement offer with cost implications if refused.
Can you serve a Calderbank offer at a lease renewal?
Yes, commonly used to encourage settlement before court hearings.
What does Section 34 relate to in a lease renewal?
Determines new rent based on market value and lease terms.
What is compensation for disturbance?
Payment to a tenant vacating under S30 grounds, except where default applies.
What does Section 18 mean in relation to the LTA 1927?
Caps a landlord’s claim for dilapidations to actual loss in property value.
Why would you contract out a lease?
Avoids tenant security of tenure under LTA 1954.
How would you contract out a lease?
Formal warning notice and tenant declaration before lease completion.
What are the Section 30 grounds under the LTA 1954?
Grounds (a)–(g), including tenant default, redevelopment, own occupation.
What tenancies are covered by the LTA 1954?
Business tenancies, excluding licences and short-term agreements (<6 months).
What is the difference between a lease and a licence?
Lease grants exclusive possession; licence is a personal right to occupy.
What does subject to contract/without prejudice/without prejudice save as to costs mean?
Subject to contract – Not legally binding. Without prejudice – Cannot be used in court. Without prejudice save as to costs – Used in court for cost decisions.
What is a turnover rent?
Rent based on tenant revenue.
What is a geared rent?
Rent linked to underlying asset value.
What is a fitted assumption?
Assumption that premises are fully fitted at rent review.
What is a fitting out rent-free period?
Rent-free period for tenant’s fit-out works.
What is the presumption of reality?
At rent review, actual market conditions should be reflected.
What is one example of rent review/break option/lease renewal case law?
United Scientific Holdings Ltd v Burnley Borough Council (1978) – Rent review time limits are not always ‘time of the essence’.
What is a diminution valuation?
Assesses reduction in property value due to disrepair (S18 LTA 1927).
What legislation relates to diminution valuations?
Section 18 LTA 1927, Dilapidations Protocol.
Why are turnover rents becoming increasingly popular?
Encourages tenant affordability and landlord-tenant alignment.
What is the precedent set in WH Smith Retail Holdings v Commerz RI mbH (2021) relating to pandemic rent suspension clauses?
Court upheld rent suspension due to Covid-related restrictions, affecting lease renewals.
What is the ‘Chartbrook’ principle on index-linked rent reviews?
Rent review clauses must be clear and unambiguous in drafting.
How do you collate, analyse, and adjust comparable evidence?
- Collate – Gather evidence from CoStar, EGI, Land Registry, local agents. 2. Analyse – Adjust for location, size, lease terms, incentives, and tenant covenant. 3. Adjust – Make qualitative and quantitative adjustments based on market trends.
What is the hierarchy of evidence?
- Open market lettings. 2. Lease renewals. 3. Rent reviews. 4. Third-party determinations (arbitration, expert reports). 5. Asking rents (least reliable).
What is the Landlord and Tenant Act 1954?
Governs security of tenure and lease renewal rights for business tenants.
What was included in your desktop analysis for 148 Conwy Road?
Market rent comparables, lease terms, tenant covenant strength, planning restrictions.
Why is it less desirable to be outside the act?
No security of tenure, tenant must negotiate new terms or vacate at lease expiry.
What terms did you agree for 15 Gloddaeth Street?
Agreed a five-year term with tenant break clause at year three to provide flexibility.
What did you need to consider regarding access rights for 110 Mostyn Street?
Checked rights of way, service access for deliveries, and shared areas.
What was included in the HoTs for 110 Mostyn Street?
Rent, lease term, repairing obligations, rent review provisions, service charge liability.
What advice did you give your client for 110 Mostyn Street?
Recommended contracting out of LTA 1954 for flexibility, ensuring tenant understood implications.
What is a Section 25 notice?
Landlord notice under LTA 1954 to terminate or propose renewal terms.
Why would you serve a Section 25 notice?
To initiate lease renewal negotiations or end the tenancy on valid grounds.
What terms did you negotiate for Unit 3 - Victoria Centre?
Agreed rent-free period in exchange for a longer lease, securing income stability for landlord.
Why was a licence more suitable than a lease at 110 ms?
A licence was suitable because it provided no security of tenure under the L&T Act 1954, allowed for quick termination if redevelopment progressed, and was appropriate for a temporary, non-exclusive use.
How was the licence fee negotiated for 110ms?
I benchmarked against local comparable short-term agreements, adjusting for the limited rights and flexibility offered.
Was a licensee found for the coffee shop?
Yes – a local independent operator was secured on a 12-month licence, with potential to extend if both parties were satisfied.
Why did you recommend reducing the rent for unit 3?
Market conditions and local evidence showed a drop in Zone A rates after negotiations. A reduced rent was necessary to retain the tenant and avoid a potential vacancy.
Why did you recommend a S25 notice for unit 3?
A Section 25 notice was required to formally propose renewal terms under the Landlord and Tenant Act 1954, protecting the landlord’s position and opening negotiations as the tenant was quiet regarding the renewal.
What action would you have taken if the tenant had not responded at unit 3?
I would have checked if a counter notice (S26) or court application was submitted, assumed the tenancy would end on the termination date in the S25, and prepared to either re-let or initiate possession proceedings.
What did the L&T Covenants Act 1995 introduce?
It introduced automatic release of outgoing tenants on assignment, the ability for landlords to require an Authorised Guarantee Agreement (AGA), and changes to privity of contract, removing historic ongoing liability.
What does ‘time of the essence’ mean in a rent review?
It means if either party misses a deadline, they may lose the right to trigger or respond to the rent review.
What is the difference between an arbitrator and an expert?
An arbitrator is appointed under the Arbitration Act 1996, must follow formal procedures, and their award is binding. An expert gives a decision based on their own knowledge and investigations, often with no formal hearings, and their decision is also binding unless they act outside their remit.
What are rent review assumptions and disregards?
Assumptions treat the property as if certain conditions exist (e.g., in good repair, let as fully fitted), while disregards ignore certain facts (e.g., tenant improvements or goodwill). These are used to ensure the rent reflects a market level, not distorted by specific circumstances.
What is a S26 notice?
A Section 26 notice is served by the tenant under the L&T Act 1954 to request a new lease. It sets a proposed commencement date and outline terms. The landlord must respond within 2 months if opposing renewal.
How can a lease be contracted out of the L&T Act 1954?
The tenant must sign a statutory declaration confirming they accept no security of tenure, the landlord must serve a formal warning notice (either 14 days before or with declaration), and the lease must state that Sections 24–28 are excluded.
