Security of Tenure (LTA 1954 Part II) Flashcards
when does security of tenure apply? (4)
- tenancies = fixed or periodic tenancies - not licenses or tenancy at will or excluded tenancies
- tenant occupies premises = T must be in control of premises, not underlet and not left vacant
- tenancy is for purpose of business = defined widely as occupation for the purposes of trade, profession, or employment
- AND the tenancy is not contracted out
what tenancies are excluded from security of tenure? (3)
- agricultural or mining tenancies
- service tenancies = lease granted as part of T’s employment
- fixed term tenancies of 6 months or less
NOTE = this can become protected if:
- T has been in occupation for 12 months or more via successive tenancies, or
- tenancy is renewable beyond 6 months
which leases can security of tenure be contracted out of?
ONLY FIXED TERM LEASES
periodic tenancy that qualifies for SoT cannot be contracted out of
procedure for contracting out of security of tenure (3)
- L serves a warning notice on T BEFORE parties complete the lease
- T must provide a declaration before completion =
- if lease completion is at least 14 days away from date of warning notice = T CAN provide a SIMPLE DECLARATION
- if lease completion is less than 14 days away = T MUST provide a STATUTORY DECLARATION
- lease must contain reference to L’s warning notice + T’s declaration + the LTA 1954 Act
what is the effect of lease having security of tenure vs not having it?
at the end of the contractual term:
- non-protected tenancy =
- T has no right to occupy beyond the contractual term. If L notified T that it requires possession at the end of contractual term and T continues to occupy, L may treat T as a trespasser and recover possession - protected tenancy =
- T has the right to stay in occupation beyond the contractual term (‘HOLDING OVER’) on the same terms as the original lease
- L cannot evict T
- T’s occupation can only be brought to an end by methods allowed under LTA 1954
- T and L can apply to court for the grant of a new tenancy
how to end a protected tenancy = L (2) vs T (5)
L wants to end protected tenancy =
- Forfeit lease if T breached tenants covenants and the lease allows this
- serve section 25 notice that can indicate (1) intention to recover premises (hostile), or (2) offer a renewal lease (friendly)
T’s options re protected tenancy =
- vacate premises at end of contractual term
- surrender lease with L’s agreement
- periodic tenancy = serve a notice to quit
- serve a section 26 notice to request a new tenancy
- serve a section 27 notice to leave the premises
what are the contents and options for a section 25 notice by landlord? (2)
- L states a proposed date for the current tenancy to end (date of termination)
- friendly section 25 notice = L is willing to renew lease to start the day after the date of termination; L will propose terms of new tenancy in the notice
- hostile section 25 notice = L intends to oppose renewal of the lease, L must state the statutory grounds it intends to rely on to recover possession; L can apply to court under the grounds to oppose renewal at any time after the notice is served
why would a landlord serve a friendly s25 notice to renew the lease if the tenant can still hold over? (2)
- peace of mind to have the tenant locked in for a further fixed term to have their income guaranteed
- to increase the rent if market rent increased because the tenant would hold over under the terms of the old lease so would be paying lower than market rent
when must landlord serve section 25 notice on tenant? In other words, when can the landlord propose to end the tenancy? when does it expire?
L states suggested date of termination of the current tenancy
proposed date of termination must be:
- on or after the contractual term expiry date (not before), and
- 6 months or more after the date of serving the notice, and
- 12 months or less after the date of serving the notice
so, the notice must be served:
- no less than 6 months from the proposed date of termination, and
- no more than 12 months from the proposed date of termination
- but can be served before the contractual expiry date
the notice will expire at the proposed date of termination stated
what are the grounds for landlord to submit hostile section 25 notice?
are they discretionary or mandatory?
are they compensatory or non-compensatory?
what must be proven for each and what evidence may be needed? (6)
- persistent and serious breaches of repairing obligation by T (discretionary and non-compensatory)
- persistent delay in paying rent = evidence includes length of delay and number of times T failed to pay (discretionary and non-compensatory)
- serious and persistent breaches of other covenants by T (discretionary and non-compensatory)
- Landlord offers T a suitable alternative accommodation = evidence of such offer considering T’s business and goodwill (mandatory and non-compensatory)
- Landlord intends to demolish or reconstruct premises or carry out substantial construction work = evidence of firm and settled intention to do this like planning permission / construction contracts (mandatory and non-compensatory)
- Landlord intends to occupy the premises itself ONLY if L owned the reversion for 5 years before the proposed date of termination = evidence of a firm and settled intention for L to occupy and evidence of L owning the reversion for 5 years (mandatory and non-compensatory)
can L serve a section 25 notice after T served a section 26 notice?
NO - mutually exclusive
if a notice (25,26,27) has been served, this precludes anyone else from serving another notice afterwards
why would T want to serve a section 26 notice to renew the protected tenancy despite their right to hold over? (3)
- T may want certainty of a fixed term, particularly if it is planning to carry out improvements to the premises or to assign the lease as a part of a business sale
- In a falling market, T may be stuck on a higher than market rent while holding over (particularly if there was a penultimate day rent review) and will want a renewal lease at a market rent
- Prevent a landlord from serving a hostile section 25 notice to recover possession of the premises
what are the requirements for T to be able to serve a section 26 notice to renew a protected tenancy? (4)
- lease must have an original contractual term of MORE THAN 1 YEAR (a tenancy for 1 year or less but more than 6 months = T cannot serve s26 but L can serve s25)
- term must be fixed not periodic
- T can serve the notice before or after the contractual expiry date, BUT the earliest T can serve is 12 months before the contractual expiry date with a proposed commencement date of the date of contractual expiry
- T must propose a commencement date of the new lease to be:
- cannot be before the contractual expiry date of the current lease
- not less than 6 months after serving the section 26 notice
- not more than 12 months after serving the section 26 notice
what is the earliest date the tenant can serve a s26 notice?
12 months before the contractual expiry date with a proposed commencement date being the contractual expiry date
example: contractual expiry date is 15 July 2024 - the earliest date T can serve the notice is 15 July 2023 for a proposed commencement date of 15 July 2024
what can the landlord do after being served with a section 26 notice?
- landlord can serve a counter-notice but must do so within 2 months of service of the section 26 notice - in which it opposes renewal on a statutory ground (otherwise it must grant the tenancy)
- the landlord can apply to court after serving the counter-notice but must apply to court before the proposed commencement date - this is to oppose renewal on one of the statutory grounds
