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is tenancy agreement correct

Posted: Thu Jul 25, 2013 8:50 am
by hackedoff
We have a 6 month shorthold tenancy agreement between us (landlords) and a trust. We have served tenant with notice to quit under section 21.
We have been told that according to the 1988 Housing Act this kind of agreement must be between a landlord and a private individual, so can't be set up with a company for example. But we can't find any info on trusts.

According to the trust deed, a copy of which was supplied in lieu of a reference, there is only a sole trustee, our tenant. There is the possibility, of course, that other trustees have since been added in another deed. If so, how would that affect things?

If this tenancy agreement isn't legal then that would make the notice to quit invalid. The lettings agency who set the agreement up on a tenant find only basis, assure us that it is quite correct.

Also, as he paid 6 months rent in advance, we have been told that he may now be on a 6 monthly periodic rental and not the usual monthly periodic.

Has anyone else encountered this problem?

Re: is tenancy agreement correct

Posted: Thu Jul 25, 2013 10:12 am
Have you contacted citizens advice for help? Also I think you could most likely find this information somewhere on google.

Re: is tenancy agreement correct

Posted: Thu Jul 25, 2013 12:27 pm
by arsie
I would check with a knowledgeable solicitor as regards trusts but I don't see why a trust cannot be treated in the standard way. I have let to individuals and also to companies big and small via ASTs. The big was Roche, the large multinational, the small was a one many band company. I used a very competent estates agency, Frosts of St Albans.

As to paying rent in advance, I don't see why this alters the fact that the tenant has to specifically be offered and sign up if there is to be a further 6-month assured tenancy period: which from what you say does not appear to be the case here. By default the tenancy reverts to monthly although you as landlord have to give two months notice if I recall correctly.

My 'small company' did just this and then the occupants (a family) left mid period. I successfully took the company to court for damage to my property and the balance of the rent due for the 6-month period the company had signed up for.

Re: is tenancy agreement correct

Posted: Thu Jul 25, 2013 4:16 pm
by hackedoff
Thanks both of you for replying.

We will go to see a solicitor as I think we will have problems with this tenant and need to be sure of where we stand.

The law seems to be so heavily in favour of tenants especially when they have children, which our tenant has. I can understand this to a point but in our case we have discovered he has had at least 4 tenancies before & we are no. 5. In every case his method is the same. Sign up for AST & pay 6 month up front. At the end of the period, list repairs that need doing and withhold rent. Repairs get done but still no rent, just lies & excuses. Notice served but ignored, apply to court for possession. Tenant ignores date. Have to apply to evict. Tenant moves out days before bailiffs come, wrecking house, owing substantial rent arrears plus legal costs.

He has been trying for some time (without success) to persuade us to get deposit back from registered account held by agents. We then found that he had got a previous landlord to take deposit back then successfully sued the landlord for the amount of the deposit plus 3 months rent. So he gains each time by living for many months rent free.

We are also concerned because he pays no utility bills or any others for that matter. Someone has told me that the gas/electric will force entry into the house and install a prepayment meter which will devalue the property.

Re: is tenancy agreement correct

Posted: Thu Jul 25, 2013 5:33 pm
by arsie
It is a pity your agent who found this tenant did not know this record. Should your agent have found out as you have now done? Just a thought. No doubt their small print excludes them from liability but there is the question of due diligence.

Given the man's past history and likelihood of a repeat all I would suggest you can do is to try to limit your loss. You are looking at six months lost rent plus the cost to repair actual damage to your property to the state where you can re-let. I don't suppose if you offered him double his deposit he would leave after notice? Always assuming he can 'trust' you :roll:

I must say I do not understand how he could successfully sue a landlord for 3 months rent - was there more to it?

Re: is tenancy agreement correct

Posted: Thu Jul 25, 2013 7:26 pm
by hackedoff
Hi Arsie,

Yes, I think you're right, we're best to limit our loss and accept the situation we're in. We're very new and inexperienced at this renting game as you can probably guess.

Apparently, if the deposit is not being protected by being held in an authorised account as required by the government since April 2007, the section 21 notice procedure will not be able to be used. The advice given to our tenant when he lived at previous property, by Community Legal Advice, was that 'if he had reason to believe that his deposit was not being held in authorised scheme he could make an application to county court. If the court is satisfied that the landlord failed to comply with the requirements, they can order that he either place the deposit with one of the schemes or pay it back to tenant. They can also order that landlord pay tenant up to three times the deposit amount!' This particular landlord had already taken it out of the authorised scheme and our tenant successfully sued him. This is why I think he's been relying on our ignorance and trying to get deposit released back to us. But ours remains in proper scheme.

We have a letter from agents advising that they'd found us a prospective tenant and were at present sourcing references and would advise once a tenancy commencement date had been arranged. Then, when tenancy had been set up, they sent us an invoice/advice note reading 'To: Administration charge for advertising and referencing a tenant for the above property on a Tenant Find Only Basis.... They are a well known and very reputable agency. But what do you think?

Re: is tenancy agreement correct

Posted: Thu Jul 25, 2013 8:17 pm
by arsie
I was only a landlord for several years once and not 'a professional' but you learn a lot about things quickly, not always good things. I escaped comparatively unscathed whereas you are up against a tricky situation :(

You have email :)

Re: is tenancy agreement correct

Posted: Thu Jul 25, 2013 8:51 pm
We have been landlords for fifteen months, since my father died. The agents manage the property and we are very satisfied. However you paid for the agents to check references and I do not see how they have done their job properly. Our agents had copies of the bank statement of each tenant, (there are two). I think in your position I would go to the agents and ask why they did not find out this information about the tenants. In our case the agents applied to the previous landlords for references. Surely there is an organisation which covers agents in this situation. Is it worth enquiring and contacting them? If solicitors are negligent there is the Law Society to contact, I think there must be a similar situation for agents.

Re: is tenancy agreement correct

Posted: Sun Jul 28, 2013 12:10 pm
by Conveyancer
The immediate question is not how you got where you are, but now that you have got there what your position is.

If the tenant named in the tenancy agreement is an individual and that individual is in occupation then the tenancy is an assured shorthold tenancy (assuming naturally that all the other necessary conditions apply). It makes no difference in what capacity he purported to take the tenancy. Accordingly, assuming the deposit was protected and the statutory conditions complied with, you can serve a section 21 notice.

If everything is in order, the court must order possession. The court has some discretion as to when the order expires and accordingly will take the tenant's circumstances into account and that includes whether there are children. The days when families could be thrown on the street with little or no notice are, thankfully, long gone.

If in doubt you should consult a solicitor, but make sure it is one who knows what he is doing. Do not rely on your local CAB, the man in the pub or anything you read online because the advice given is not always reliable.

Re: is tenancy agreement correct

Posted: Mon Jul 29, 2013 9:23 pm
by hackedoff
Thanks Conveyancer. We are taking legal advice now.