Here is a question to the blog clinic from Cliff (not his real name) who is a landlord
I am a private landlord living abroad and I am renting my property through one of the well-known Estate Agencies.
I have recently signed a contract with a tenant for a term of 2 years, with a break up clause after 9 months. However, due to a scaffolding being erected for a period of 3-6 months, the tenant has informed me through the estate agent that she will move out tomorrow and wants to be paid back the deposit and the rent she has paid in advance.
Her reason is that had she known about the scaffolding, she wouldn’t have been interested in the property.On my side, probably I should have been more informed about the scaffolding being erected at the time of the signature of the agreement (I wasn’t unfortunately), but my question is: can she really walk out so freely breaking the agreement recently signed? Is it that simple?
I have proposed that she can move out when I have found a new tenant but she has refused. Alternatively, I was thinking of reducing the rent (amount to be discussed) for the period of the works, but I am not sure she will accept.
Can she really take legal action or maybe I should take legal action against her, due to the early and unexpected break up of the agreement?
Answer
The short answer is no, your tenant cannot walk out on the tenancy like that. She has signed a legally binding agreement and is liable to you for the rent, on a month by month basis, until the end of the fixed term.
Whether or not she lives there.
There is an old rule often known by its Latin wording ‘caveat emptor’ which means ‘let the buyer beware’. It means that if you are buying or contracting for something you need to make sure before you commit yourself that you want to go ahead.
Now in many consumer type contracts there are laws, such as the Sale of Goods Act which give consumers rights to end the contract in certain circumstances. However, there are no such rules for rented property.
Misrepresentation
The only law I can think of which may give her that right is under the Misrepresentation Act. However, this is dependent upon there being a ‘representation’ which was wrong.
So if the tenant said to the agents ‘Are there going to be any building works which will affect my use of this property’ (or something similar) and they said ‘no’ then (even if they genuinely believed that they were correct) she will have the right to end the contract.
However, if nothing was said about it, then there has been no ‘misrepresentation’ and she has no rights under the act.
Before going any further therefore, you need to speak to your agents and see what was said by them as you will be bound by what they said to the tenant.
However if they can assure you that nothing was said to the tenant about this, not even something which could be misleading (however innocently) such as what a lovely view there is from the windows, then I think you are in the clear.
In which case you should say to her that the scaffolding is nothing to do with you, that you were unaware that it was going to be erected, and that she is bound by the agreement. Then send her a separate ‘without prejudice’ letter setting out your proposals, ie that you will try to find a new tenant for her but that she is responsible for the rent in the meantime.
Under the strict law, note that (assuming there was no element of misrepresentation) you are not responsible for finding a new tenant if she decides to leave early, and you can hold her liable for the rent for the whole of the fixed term, on a month by month basis.
Just because it wasn’t mentioned…
Although they probably wouldn’t apply in these circumstances, the 2014 amendments to the Consumer Protection from Unfair Trading Regulations 2008 do allow tenancies to be brought to an end early in some circumstances.
Tenants now have the ‘right to unwind’ the contract within the first 90 days if they entered into it as the result of a prohibited commercial practice (usually either an aggressive commercial practice, or misrepresentation). Depending on the circumstances, they can either bring it to an end, seek a refund, or claim damages. (The CMA confirms this applies to residential tenancies.(
BUT it does still depend usually on their being some sort of active misrepresentation – under the regs there has to be a misleading action, and a misleading omission is not enough. So not mentioning the scaffolding probably wouldn’t give the tenant the right to unwind.
Still might be worth watching out for though…
Not sure I agree with the analysis Bryan.
You are referring to the madly named “Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013”
These apply specifically to contracts signed at a distance (for instance email) or where the contract was concluded in the person’s home. So if for instance the tenancy agreement was signed in the office of the letting agent it wouldnt apply
If the person signing is given a formal cancellation notice on sign up then they have 14 days in which to cancel. If no cancellation notice is given they have 12 months.
However, outside of these regulations sits the Law of Property Act 1925 and sundry other pieces of housing legislation that I dont think the 2013 regulations were ever meant to apply to.
I wouldnt advise one of my tenant clients that the regulations apply to a situation like Cliff’s above
Unfortunately, I think you are caught by the CPR’s (Consumer Protection from Unfair Trading Regulations) mentioned above which do require to be mentioned anything that you are aware of which might affect the consumers ‘transactional’ decision making process. If you knew that you were planning works which would require this scaffolding and which would therefore interfere with her enjoyment of the property but it wasn’t mentioned -AND the tenant would not have taken the property had she been informed, I fear the tenant may well have cause to seek redress even if she is not strictly entitled to give up the tenancy. I think I might let her go……………
sorry ! I didn’t read the previous post properly and agree with Ben about the distance selling regs which in itself has been superceded by CPR’s which sales AND letting agents ignore at our peril!
Hi Ben,
I’m not referring to the 2013 regulations actually. What I’m referring to are the 2014 regulations: the slightly more tediously named “Consumer Protection (Amendment) Regulations 2014” SI 2014/870
Unlike the 2013 regs, the 2014 amendments don’t just apply to contracts signed at a distance. They insert a new Reg27E-F into the Consumer Protection from Unfair Trading Regulations 2008 that Robert mentions, that covers the right to unwind.
They’ve not been used that much as far as I know, apart from a few county court proceedings, and they don’t seem to be that widely known. But, they do exist and info from the CMA and the government’s response to consultation seems to show they were intended to apply to residential tenancies
@Bryan. I stand corrected and a very interesting twist in the tale.
I’d like to read up more about the government response your refer to which would have a significant impact on tenants rights. Do you have a link?
Last year I advised a friend on exactly Cliff’s conundrum with scaffolding and noisy builders. I think he is still locked in litigation
@Ben
There’s a guidance document on gov.uk
https://www.gov.uk/government/publications/misleading-and-aggressive-selling-new-rights-for-consumers
Says the following on applicability of tenancies:
“20. The new Regulations do not generally cover contracts in respect of immovable property, such as selling houses or land. Social housing provided by local authorities, housing associations or private landlords is not covered.
21. There are however two types of tenancy which are covered:
(1) assured tenancies within the meaning of Part 1 of the Housing Act 1988; and
(2) leases under which accommodation is let as holiday accommodation.”
The response to the consultations on the draft I mentioned is here;
https://www.gov.uk/government/consultations/protecting-consumers-from-misleading-and-aggressive-selling
Thanks Bryan, thats really useful
Yeah cheers Bryan. now THATS a cat among the pigeons announcement. I’ll be looking closely at it
The 2008 CPRs initially meant the end of ‘caveat emptor’. They were quite clear that omission of material information was prohibited.
However, the newly inserted section 4a in the 2013 version now specifically excludes the omission of material information from the definition of a ‘prohibited practice’ under which a consumer is entitled to redress.
As I understand it, the part about omission of material information being prohibited is still in there, but you specifically cannot seek redress on this issue!
What about the right of the tenant to “quiet enjoyment” of the property? Obviously the scaffolding is interfering with this right.
I also find it hard to believe that the landlord or the agent would not have been informed of any proposed works requiring a minimum 3 months of scaffolding.
“Quiet enjoyment” simply means that no one will interfere with his tenant’s right to possession, lawful use, and enjoyment of the premises. “Enjoyment” in this context means to have the use and benefit of a right, not to get pleasure from something.
The scaffolding would not interfere with any of these rights (unless it blocked access in some way).
QE would not be applicable otherwise a landlord would never be able to carry out works on the property even if required to do so or it was a matter of health and safety.
It could possibly kick in if a landlord arranged to have scaffolding put up either for a legitimate purpose or not and then failed or declined to have it taken down, such that it expressly or impliedly was for the purpose of interfering with QE.
Whilst it might be unusual for a freeholder not to inform leaseholders of intended work it is not impossible. The standards of management of leasehold property is a regular cause of dispute and often about the freeholder’s failure to repair. The original poster did not say she or the agent did not know, only that it was not an issue that was discussed.