Monday, 17 September 2012

PROPERTY ARTICLE: Breaking a tenancy agreement. Copyright SvD.

Breaking a tenancy agreement

I was recently asked by a tenant to help them with a sticky dilemma. He had signed a tenancy agreement for 12 months but midway through the lease decided to move out and head back to the US. When the tenant had signed the lease he had been assured that the agreement contained a break clause at 6 months. Unfortunately the tenant did not check what they were signing and there was no such clause in the agreement. The tenant’s question was the following: if there was no break clause, are they liable for the rent for the entire 12 months?

The answer is YES.

Some landlords can be very accommodating and will do anything to keep a good tenant happy. Other landlords when faced with losing vital income will stick to the rule of the law. From a legal perspective the tenant is liable for the rent for the full term of the lease. i.e. 12 months if there is no break clause. Break clauses usually run at 2 at 4 meaning after four months the tenant can serve notice, that notice being two months. The landlord therefore is guaranteed 6 months rent in such an instance.

In the case of the tenant who approached me I recommended that he discuss the issue with his landlord and see whether he would agree for the tenant to find a replacement to take on the balance of the lease. The tenant asked around his circle of friends and colleagues and was able to find someone who needed a place to live albeit at a cheaper rent. After much wrangling the prospective replacement tenant agreed to pay what had originally been agreed in the lease and the landlord was happy with the arrangement. The outgoing tenant paid for all the reference and credit checks so was still out of pocket but in the end, it was a smaller price to pay that the full six months’ rent remaining on the lease.

I should close by saying that tenants should bear in mind that a tenancy agreement is a legal document. And once signed they remain liable for the rent and must comply with the terms and conditions set out therein. Tenants are advised to fully explain their requirements to the agent when making an offer on a property and should also ensure that they understand what they are agreeing to and signing. If in doubt, pay a solicitor to check the tenancy agreement on your behalf in order to be absolutely sure that the tenancy agreement has included all of your requirements and that you fully understand what you are agreeing to. Lettings agents tend to use standard agreements and do not have the legal nous to amend or change clauses. Tenants should request that any specific requests are listed on an A4 sheet and attached to the agreement as an Addendum of Terms. The Addendum of Terms then forms part of the tenancy agreement as long as it is signed and dated by both parties.

No comments:

Post a Comment