Rent Review: When is time of the essence?

Where a lease specifies a date for compliance with an obligation such as the date for service of a break notice or for triggering a rent review, it is important to understand what happens if the date is missed.

Where a lease expressly states that time is of the essence (or it can be implied) failure to exercise the right in time will mean that the right is lost.

For rent review clauses, there is a general presumption that time is not of the essence, unless there are sufficient contra-indications as a result of:

• any of the express words of the lease;
• the surrounding circumstances;
• the relationship between the rent review clause and the other clauses in the lease.

In practice, this will mean that where a date for triggering a rent review has been missed, it is not necessarily the case that the right to review has been lost. Analysis of the lease will be required to consider whether time was intended to be of the essence or not.

By contrast to rent reviews, time is always of the essence in relation to break notices, meaning that a failure to comply strictly with time limits set out in the break clause can (and often does) prove to be fatal.

Rent Review: Legal effect of a rent review memorandum

Leases often require that, once a rent review has been agreed, the new rent be recorded in a rent review memorandum. What legal effect, if any, the memorandum will have generally depends on how the rent review clause has been drafted.

For example, some leases may specify that the rent review will only be complete once a memorandum has been signed off, meaning that the memorandum is more than simply a record and instead amounts to the formal document by which the review is agreed. Some leases, though, will only require that a memorandum be completed once the rent has been agreed.

In this latter type of case, the existence of the memorandum will not be the defining factor as to whether the review has been agreed or not. While obviously being able to produce the rent review memorandum is helpful, the more pertinent question is whether the parties came to an agreement or not and that is a question which requires a forensic examination of what was said/written between the landlord and tenant or, more commonly, their respective rent review surveyors.

Break Notices: tenant refund where break date is between two rental periods?

Lease renewal (opposed and unopposed): What are the grounds for opposing renewal?

Most leases of business premises have security of tenure, meaning that the tenant does not necessarily have to leave at lease expiry, unless one of a number of grounds are made out.

The grounds are set out in section 30(1) of the Landlord and Tennact Act 1954 and, in brief terms, are as follows:

• The premises are in disrepair (Ground (a))
• There are arrears of rent (Ground (b))
• There are other breaches of covenant (Ground (c))
• There is suitable alternative accommodation (Ground (d))
• The tenancy was created by a sub-letting (Ground (e))
• The landlord has an intention to redevelop (Ground (f))
• The landlord has an intention to occupy (Ground (g))

A significant body of case law has evolved since 1954 governing how these grounds of opposition work in practice. Generally, grounds (f) and (g) tend to be the ones most commonly relied upon.

If a landlord wishes to rely on one of the grounds of opposition, it will need to prove its ground(s) of opposition at a court hearing, unless agreement can be reached between landlord and tenant as to the tenant’s exit terms.

Forfeiture: Relief from forfeiture after 14 month delay

In Pineport Ltd v Grangeglen Ltd [2016] EWHC 1318 (Ch), the court was prepared to grant relief from forfeiture despite a 14 month delay by the tenant in seeking relief.

The court had to consider whether it could be said that the application was made with “reasonable promptitude” taking a six-month period as a guide.

The company claimed that the delay arose from a combination of factors including a restraint order, lack of money and the absence of specialist advice, and the fact that the director was suffering from depression. That evidence, combined with the effects of the company director’s depression were weighty factors to be put in the balance. The court confirmed that the discretion to grant relief was broad, and reasonable promptitude was an elastic concept capable of taking into account human factors. Although 14 months was more than double the guide period, it was held that it would be wrong to bar the company from obtaining relief.

Professional negligence claims: What pre-actions steps are necessary?

When considering a claim against a professional, perhaps a firm of solicitors or surveyors, potential claimants are required to follow the Professional Negligence Pre-action Protocol before issuing their claim.

In practice, this means that as soon as it is known that there is a reasonable chance of a claim against the professional being pursued, a “preliminary notice” must be served, giving general details of the claim, including the grievance, the parties involved and the financial value. The professional should acknowledge receipt within 21 days but need do nothing else.

If a claimant decides that there are formal grounds for a claim, a Letter of Claim should be sent. This should include:

• The identity of any other parties involved
• A clear chronological summary, including key dates and key documents
• Any reasonable requests which the claimant needs to make for documents
• The allegations against the professional
• An explanation of how the alleged error has caused the loss claimed
• An estimate of the financial loss
• Confirmation of whether or not an expert has been appointed
• A request that a copy of the Letter of Claim be forwarded immediately to the professional’s insurers, if any.

The professional should acknowledge receipt within 21 days and send a formal Response to the Letter of Claim (or a Letter of Settlement or both) within three months of the acknowledgment (or, where necessary, seek an extension of time).

As to the Response:

• If the claim is admitted, the professional should say so
• If only part of the claim is admitted the professional should make clear which parts are admitted and which are denied.
• If the claim is denied, the professional should provide his version of events.
• If the professional is unable to admit or deny the claim, the professional should explain why and identify and further information which is required.
• If the financial loss is disputed, it should set out the professional’s estimate.
• To the extent not already exchanged, key documents should be enclosed.

If the professional send a Letter of Settlement, it should:

• Set out the professional’s views on the claim identifying those issues which the professional believes are likely to remain in dispute and those which are not.
• Make a settlement proposal or identify any further information which is required before the professional can formulate its proposal.
• Where additional documents are replied upon, copies should be provided.

If the Letter of Response denies the claim in its entirety and there is no Letter of Settlement, it is open to the claimant to commence court proceedings. Otherwise, negotiations should commence with the aim of resolving the claim within 6 months of the date of the Letter of Acknowledgment.

There is scope for extending this time limit, but in the absence of agreement, it will then be open to the claimant to commence court proceedings.

Adverse possession and boundary/neighbour disputes: proving adverse possession

Adverse possession relates to the means by which a person, who is not, on paper, the legal owner of land, can nonetheless become the legal owner by virtue of possessing the land for a lengthy period of time.

Two key factors are involved in claiming adverse possession:

• uninterrupted factual possession of the land for the requisite period; and
• an intention to possess the land during that period of possession

The factual possession element means that the claimant must have had physical control of the land for the requisite period and, in general terms, acted as if they were the owner. Equally, there must be an intention to possess by the claimant to the exclusion of all others.

A significant body of case law has developed over the years as to what is meant by factual possession and the intention to possess.

Different rules apply to adverse possession depending on whether the land is registered or unregistered and the period of time over which adverse possession is claimed.

The Land Registration Act 2002 (LRA 2002) came into force on 13 October 2003 and introduced a new regime for dealing with adverse possession in relation to registered estates.

The previous regime, which is based on the Limitation Act 1980 (LA 1980), continues to apply but only in relation to:

• Unregistered land
• Registered land where the possession relied upon is for a period of at least 12 years ending before 13 October 2003

Under the new regime, a claimant will be entitled to apply to be registered as the owner of registered land if they can prove that they have been in adverse possession for ten years ending on the date of the application. However, in addition, a claimant must give notice to the paper owner of their wish to be registered and the paper owner may object based on a number of specific grounds.

Easements: The importance of signage to prevent prescriptive easements

An easement can arise by prescription (i.e. long use) if a trespasser shows 20 years’ use “as of right”: without force, without secrecy and without permission.

The Court of Appeal (following an earlier High Court decision) has considered the application of this in the case of Winterburn v Bennett [2016] EWCA Civ 482. It involved a local fish and chip shop’s customers and suppliers using the next door Conserative Club car park for parking, despite the existence of a clearly visible sign saying “Private car park. For the use of Club patrons only. By order of the Committee.” Following the obstruction of the parking area by the tenant of a new owner of the premises, the fish and chip shop owner claimed to have acquired a right to parking by prescription.

The question was whether the right was used “without force”, despite the presence of the signage: there was no doubt that the parking on the disputed land was open and known and that no permission for parking had been given.

The phrase “without force” means more than simply its literal meaning. The person asserting the right could not merely show that he had not used violence. Instead, they must show that their user was not contentious or allowed only under protest.

Here, where a land owner had made its position on someone else’s use of the land obvious through clearly visible signs, the unauthorised use could not be said to be “as of right”. The signs were by themselves sufficient to make contentious the parking of cars and other vehicles by the shop and its suppliers and customers. Helpfully, the court recognsied that there was no requirement on the land owner to elevate his protest, by writing letters or issuing court proceedings, recognising the social and financial cost in doing so.

Ownership of land disputes: Replies to enquiries: consequence of providing false information

The case of Greenridge Luton One Ltd & Anor v Kempton Investments Ltd [2016] EWHC 91 (Ch) (22 January 2016) gives a stark example of the consequences of providing false information in replies to enquiries.

In relation to a sale of office buildings near Luton Airport, the seller (with the help of his solicitor) had indicated in replies to pre-contract enquiries that no disputes existed and that there were no service charge arrears.

In fact, by the time of sale, the solicitor had for some time been involved in extensive correspondence with one of the tenants, who disputed the level of service charges and had begun to withold payments of the quarterly servce charge demand as a result. The pre-contract enquiries had not been updated to reflect this.

The sale went ahead and the buyer only later found out about the service charge dispute.

The court held that:

• Untrue representations had been made
• The buyer had relied on those representations and that they were induced to enter into the contract as a result of the misrepresentations
• Because the untrue representation that there were no arrears of service charge resulted from fraud or recklessness, the buyer was entitled under the contract to have its deposit returned.
• The buyer was entitled to damages of £395,948 in respect of costs incurred in relation to its prospective purchase of the property, which had been wasted following the rescission of the contract.

Access to neighbouring land

We advise and can make court applications in relation to the Access to Neighbouring Land Act 1992.

Access to a neighbour’s property can usually be dealt with amicably. However, where neighbours have fallen out, it may be necessary to seek a court order if a party needs access to a neighbour’s land.

Plainly, access is not granted “as of right”. We advise on whether your proposal to access your neighbour’s land comes within the criteria set out by the legislation. Equally, we can act for a party opposing such an application.

Adverse possession and boundary disputes

Adverse possession and boundary disputes often sit hand in hand.

They arise most commonly in residential, but also sometimes in commercial, contexts.

Our role is to arm clients with a realistic assessment of the issues and likelihood of success as early as possible.

Key to understanding the merits of an adverse possession claim is not only the period of possession, but also whether the person claiming possession has control over the land in question and the subjectively demonstrate possession of the land to the outside world. The Land Registration Act 2002 brought in sweeping changes to the law. We guide clients through this minefield of legislation and case law.

Our work for a typical boundary dispute might involve: detailed interpretation of the conveyances and other relevant deeds and plans; application of pertinent legal presumptions depending on the circumstances; comparison of the written description of the boundary, its marking on any plans and its presumed location on the ground. Site visits are generally essential.
These disputes are rarely straightforward. We provide clients with as much clarity and certainty as possible, often with the assistance of expert surveyors.

We also assist, wherever possible, in resolving boundary disputes without litigation. Mediations are usually worthwhile, so long as both sides have the combined ‘will’ to resolve their differences.

Agricultural tenancies

We are one of the few practices with capability to advise on agricultural law.

Our expertise is commonly sought as to the means by which the landlord and tenant relationship between landowner and farmer is affected by agricultural legislation.

Two statutory regimes are of particular relevance, namely the law relating to agricultural holdings under the Agricultural Holdings Act 1986 and that relating to farm business tenancies under the Agricultural Tenancies Act 1995.

Both landowners and tenant farmers face common issues arising from these statutory regimes, such as the means by which an agricultural holding or farm business tenancy may be terminated and on what grounds (where grounds for termination are required), together with the rights of farmers to compensation in some circumstances.

Consideration of agricultural queries inevitably also brings into play common law principles relevant to landlord and tenant law, to the extent that this has not been changed by the statutory regimes.

Alterations

We are able to assist clients in relation to disputes involving alterations to their property. Usually, this will be in the context of a landlord and tenant relationship, where consent to alterations may be necessary or where alterations are allowed but only upon certain conditions being fulfilled.

Break notices

When leases are to be terminated by notice, we are often asked to assist: landlords wish to retain their tenants at all cost and tenants are desperate to leave loss making premises. We guide tenants in exercising break rights successfully and landlords in challenging a tenant’s wish to leave.

Tenants are sometimes unaware of the strict legal hurdles to be complied with, both when serving the break notice itself, and in complying with the often stringent conditions for successful exercise of the break at the termination date.

Some conditions (particularly relating to leaving the premises reinstated and in repair) require detailed consideration. Even relatively minor breaches of the lease can cause an attempted break to fail.

We draft break notices and guide tenants through the break clause minefield. The implications of getting it wrong are stark for tenants: they may be saddled with unexpected rental obligations for the remainder of the term.

For landlords, our role is reversed: we advise on whether tenant’s efforts to break have been successful. Where there is uncertainty, our role will also extend to negotiating settlements as to the terms on which a lease will end.

For both landlords and tenants, we are also experienced in seeking court declarations as to whether a break has successfully been implemented.

Commercial rent arrears recovery (CRAR)

The remedy of distress for arrears of rent was replaced by the Commercial Rent Arrears Recovery (“CRAR”) regime in April 2014. It is a self-help remedy for landlords to pursue arrears against tenants based upon the procedure and rules set out in the legislation. We can advise landlords who are contemplating taking such action or tenants who are the subject of a CRAR procedure against them.

Contract disputes

We advise a range of clients on all manner of contractual disputes, whether the contract is set out in a written document or (as is often the case) agreed verbally and informally.

Consent to assign or sublet or alter

When a tenant wishes to extricate itself from its lease obligations, but has no right to terminate altogether, it may consider assigning or subletting to a third party, in order to limit liability so far as possible.

Usually, when a third party is found, a landlord’s consent to the proposed arrangement will be required. Landlords are often able to impose conditions on any consent. Landlords need to consider the ability of the proposed party to meet rental and other obligations under the lease.

Often landlords need to act reasonably and swiftly in considering the tenant’s application, failing which it may face an accusation that consent has been unreasonably withheld or delayed.

Landlord’s duties imposed under the Landlord and Tenant Act 1988 are key. We help clients (both landlords and tenants) in analysing their respective rights and duties arising from the alienation clauses and under statute.

Occasionally, a tenant argues that a landlord has unreasonably refused or failed to respond to applications in time. This may lead to a claim for a declaration and damages. We are able to guide our clients in bringing and defending these actions.

Similar considerations apply to consent by tenants for alterations.

Construction disputes

We have capacity to deal with construction disputes on behalf of our clients, whether relating to commercial or residential property.

Damages claims

We are able to advise our clients in relation to damages claims. Claims may arise in many different circumstances but inevitably it will be necessary to assess the methodology by which damages should be calculated and whether, when acting for a claimant, the amount claimed can realistically be recovered or, when acting for a defendant, whether the claimed damages can be reduced or extinguished altogether. In property related cases, we may well engage experts: we regularly work with property valuers, surveyors and other professionals who assist in providing expert evidence on behalf of our clients.

Debt claims

We pursue or defend debt claims for our clients. Part of our remit will usually be to assess the best and most cost effective means of recovering the debt, taking account of speed and likelihood of recovery. This may sometimes involve the service of a statutory demand or winding up petition.

Defective Premises Act

Under section 4 of the Defective Premises Act 1972, a duty is owed where a landlord either has an express obligation to repair or maintain the premises or has no such direct obligation, but has an express or implied right to enter the premises to carry out any description of maintenance or repair.

Where the duty applies, the landlord owes a duty to all persons who might reasonably be expected to be affected by defects in the state of the premises to take reasonable care to ensure that they are safe from personal injury, or damage to their property caused by a ‘relevant defect’.

We are able to assist landlords and tenants in resolving disputes relating to this legislation.

Derogation from grant

The principle of derogation from grant usually relates to a situation where a landlord grants a certain right to a tenant, but then substantially interferes with the ability to exercise that right to be exercised. Often disputes of this nature will overlap with arguments relating to the obligation to give quiet enjoyment. We help both landlords and tenants in disputes of this nature.

Development agreement disputes

Development agreements can quite often become contentious between owner and developer. Generally, such agreements are dependent on obtaining satisfactory planning permission, which can often become contentious. Equally, overage arising from development agreements can sometimes become an issue. We are in a position to advise both owners and developers alike in resolving or litigating disputes of this nature.

Dilapidations

We have extensive experience in dealing with dilapidations claims acting for both landlords and tenants alike. We work closely with building surveyors and valuers, who are an essential part of the team in pursuing or defending the dilapidations claim. As a matter of course, an early assessment is made as to whether section 18(1) of the Landlord and Tenant Act 1927 will have any significant impact on the claim. This legislation tends to be relevant where a landlord with a dilapidations claim intends to carry out development or demolition works, which may lead to a reduction in the level of damages that may be recovered.

Easements

Easements refer to the rights attached to land which allow the owner either to use another piece of land (or restrict its use) in a particular way.

Common examples include rights of way, the right to light and rights of support.

Disputes involving the nature and extent of particular rights may arise. For example, whether the right of way in a particular deed was intended for use on foot only or extends to vehicular or some other wider use.

Where residential extensions or commercial developments affect the level of light into a neighbouring property, we are equipped to advise either side on their respective rights.

We guide clients on all areas of the law relating to easements. We pursue (or defend) damages claims or injunctions, where necessary.

Enfranchisement and lease extensions

We are able to assist clients in relation to both collective and individual enfranchisement matters, including lease extensions. The relevant legislation is contained within the Leasehold Reform Act 1967 and Leasehold Reform, Housing and Urban Development Act 1993.

Estoppel

Proprietary estoppel is a means by which property rights can be affected or created, so as to make the assertion of strict property rights unconscionable. The estoppel gives rise to an equity in favour of the person who is entitled to assert the estoppel. In brief, the claimant must have acted in the belief either that it already owned, or would obtain, a sufficient interest in the defendant’s property to justify the detriment which the claimant has incurred. The assurance or promise must be one which the claimant believed the defendant was obliged to honour.

First tier tribunal claims

Our practice extends to residential leasehold disputes heard before the First-tier Tribunal (Property Chamber – Residential Property) which has jurisdiction in relation to:

• service or administration charges
• the cost of building insurance
• appointment of a manager
• Right to Manage
• breach of a lease
• varying a lease
• recognising a tenants’ association
• buying the freehold
• extending the lease

Applications before the tribunal have different rules compared to mainstream county/high court proceedings, particularly in relation to costs recovery and so specialist advice in this area is paramount.

Forfeiture

Forfeiture can be a powerful weapon for landlords to adopt against a defaulting tenant. It involves bringing a lease to an end early, whether for rent arrears or other breaches of the tenant’s covenants.

However, any landlord contemplating forfeiture should tread carefully: getting the procedure wrong or seeking to forfeit when the right does not exist, or has been waived, may lead to a damages claim by the tenant.

We advise both sides on procedures and tactics relevant to forfeiture. We draft relevant notices when required as a precursor to forfeiture. We assist (and will attend on the day) if a landlord considers changing the locks.

In appropriate cases, we also give guidance on the the applicability of the Leasehold Property (Repairs) Act 1938 to the forfeiture process.

Finally, tenants may seek relief from forfeiture. We advise landlords and tenants upon the merits of relief from forfeiture applications.

Frustration

The concept of frustration relates to the inability of a contract to be performed further as a result of some changed circumstance, such as destruction of the property or, perhaps, a change in legislation rendering further performance of the contract illegal. Frustration issues sometimes arise in relation to leases of property, particularly where a property has suffered significant damage or been completely destroyed.

Inherent defects

Inherent defect arguments tend to arise in a landlord and tenant context. Depending on the scenario, either a landlord or tenant may argue that a particular item suffers from an inherent defect and so does not, strictly speaking, form part of their repairing obligation.

A covenant to repair does not carry with it an obligation to remedy poor design, faulty installation or any other defect that has not caused damage to the property. Where there is no disrepair, remedying such a defect would be an improvement rather than a repair.

The relevance of an inherent defect argument will therefore depend very much on the wording of the lease.

Interim rent

Interim rent is an issue that may arise in business lease renewal proceedings. In broad terms, it relates to the rent payable between the coming to an end of the old lease and the start of the new lease.

Often, the interim rent will be the same as the rent payable at the commencement of the new tenancy but this is not always the case and is sometimes the subject of dispute between landlord and tenant.

Jervis v Harris clauses

Most leases will contain what is known as a Jervis v Harris clause. It allows a landlord, during the term of a lease, to enter the premises to carry out repairs and recover the cost of doing so from the tenant as a debt, in circumstances where the tenant has failed to comply with a notice to repair served by the landlord.

Pursuing a debt (as opposed to a damages claim) can be a useful weapon for a landlord, as damages claims for disrepair during the term are generally difficult to pursue.

Equally, it can be a risky approach, with potential arguments as to whether the works carried out by the landlord were actually necessary or properly fell within the repairing covenant.

Landlord and tenant disputes

Our practice regularly deals with all manner of landlord and tenant disputes, whether for business or residential clients.

We act for both landlords and tenants on either side of the argument.

Lease renewal (contentious)

Lease renewals of business leases can often be resolved amicably but this is not always the case.

Firstly, where a landlord accepts that the tenant is entitled to a new lease, there may be disagreement as to the lease terms, particularly as to duration and rent.

Secondly, a landlord may dispute a tenant’s entitlement to a new lease altogether, based on one of the statutory grounds, such as redevelopment.

We work with both landlords and tenants in relation to unopposed and opposed lease renewal proceedings, litigating where necessary but also assisting in speedy resolution without a trial, if at all possible.

Licences and tenancies at will

It is not uncommon for informal arrangements to be agreed whereby a party is permitted to occupy premises, whether for their business or home.

Informal arrangements can later become problematic, particularly where the owner wishes to regain possession. One of the first questions to arise in these cases is the legal basis for occupation. Does the occupier have any rights as a tenant or is the position more akin to a licence or tenancy at will?

The answer to such questions can be critically important in deciding whether an occupier must vacate or has some statutory rights, perhaps as a business tenant, to remain in occupation and possession.

Misrepresentation

Misrepresentation claims tend to arise in relation to sales of property, where allegations are made to the effect that a false statement was given prior to exchange which induced the buyer to entering into the contract.

The courts recognise different types of misrepresentation (fraudulent, negligent and innocent) with different consequences and remedies, depending upon which one applies.

Neighbour disputes

Neighbours can fall out for a variety of reasons, whether it relates to disagreement over who owns disputed land or as to the actions that one party has taken that in some way affect their neighbour. Generally, the courts strongly encourage alternative dispute resolution, rather than litigation, in such circumstances.

We are able to advise on the best way of reaching a quick and speedy resolution with your neighbour, whatever the scenario.

Nuisance

Private nuisance claims can arise in a variety of ways, whether as a result of noise or smells travelling from a neighbour’s property or, perhaps, dust and fumes caused by building works. Not all infringements of this nature will form the basis of a nuisance claim. However we can guide you in assessing whether such a claim has merit or in defending a claim brought against you.

Occupier’s liability

Under the Occupiers’ Liability Act 1957, occupiers owe a duty of care to take such care as is reasonable in all the circumstances of the case to all their visitors in respect of dangers due to the state of the premises or to things done or omitted to be done on them. Case law has set out that the harm which occurred must be a reasonably foreseeable result of the defendant’s conduct; a sufficient relationship of proximity or neighbourhood must exist between the alleged wrongdoer and the person who has suffered damage; and it must be fair, just and reasonable to impose liability.

If you have a potential occupiers’ liability issue, we can assist in its resolution.

Party walls

The Party Wall Act 1996 sets out a process whereby a building owner intending to carry out party wall works is required to serve a notice on any adjoining land owner specifying the works intended to be carried out as well as the proposed start date of such works.

The process then allows for the adjoining land owner either to serve a positive acknowledgement of the notice, a negative acknowledgement (objecting to the proposed works), or to do nothing. In the latter two scenarios, the next stage of the process is for the dispute resolution mechanism to kick in, whereby surveyors are appointed to survey the proposed works, consider any objections, and to make a PWA 1996 award.

Possession claims

There are numerous circumstances in which a landlord may seek possession of premises from a tenant, in both a residential and commercial scenario.

In the residential context, it will always be necessary to assess the basis upon which a tenant is occupying, as tenants’ rights can differ substantially, depending on the legislation that is applicable.

We can advise both landlords and tenants in relation to possession claims.

Professional negligence

One of the occupational hazards of professional life is that, however unintentional, mistakes are sometimes made which have serious financial repercussions.

This commonly might involve negligent advice from solicitors in a property transaction or surveyors involved in, say, valuations or at rent review. Our role is to review what has gone wrong, assess the extent to which blame can be attributed to the professional and the damages to which a client may be entitled, often with the assistance of expert witnesses.

We are also available, with sensitivity, to assist professionals and their insurers in responding to and, if appropriate, defending them against property-related complaints from their clients.

Claims must first follow the pre-action protocol relating to professional negligence. If settlement discussions fail, we then pursue or defend professional negligence claims on behalf of our clients.

Quiet enjoyment

A covenant for quiet enjoyment will either be expressly referred to in a lease or will, in any event, be implied.

Rectification

Rectification is an equitable remedy involving the amendment of a document to accord with the intention of the parties.

Parties to a contract may have had a common intention or understanding when they drew up their contract as to what it meant but that meaning has not been reflected in the drafting.

There are detailed rules whereby contracts may be rectified based on common or unilateral mistake on which we regularly advise our clients.

Rent arrears

We have in depth experience in advising landlords and tenants alike in disputed rent arrears cases, taking cases to trial and/or negotiating settlements.

For landlords, the mandate is usually clear: seek recovery of the outstanding debt as quickly and cost effectively as the facts permit. Depending on the circumstances, a number of options might arise: service of a statutory demand (the precursor to bankruptcy/winding up) or, possibly, a straightforward court claim where the arrears are disputed. Other landlord and tenant specific options may also be available.

For tenants, the priority is to establish whether or not the arrears are properly due and then, where appropriate, the potential successfully to defend a landlord’s claim.

Where appropriate, we investigate the possibility of pursing third parties for the debt (such as guarantors or sub-tenants. Equally, we are sometimes asked to advise third parties as to their liability.

Rent review

Rent review provisions in leases are of fundamental importance: a landlord’s ability to increase rent and a tenant’s ability to challenge the level of increase go to the heart of the contract.

Our expertise includes advising on the rent review mechanics: particularly how and when to implement a review and the consequences of failing to adhere to the lease’s requirements.

Notwithstanding general principles of contract interpretation, specific rules of interpretation often apply to rent review clauses.

If the review is not agreed, we guide clients when seeking a written award by, or hearing before, an arbitrator or independent expert in conjunction with expert witnesses.

Where necessary, we assist clients in seeking to rectify defective rent review terms or in applying to have certain terms implied as part of a claim for declaratory relief.

Our remit also includes professional negligence claim against solicitors or surveyors: where failings in drafting of the rent review clause or in valuation advice leads clients to suffer loss.

Restrictive covenants

The law relating to restrictive covenants, so far as freehold land is concerned, is complex. It relates to restrictions placed on the use of land for the benefit of someone else’s land. Examples might include restrictions on the height of a building or on activities which can be carried out there.

Our clients seek guidance as to their ability to challenge restrictive covenants, whether they are a party who is subject to the restriction or who have the benefit of it.

We analyse, amongst other things, whether the covenant really is restrictive: some covenants, such as requirements to carry out repairs, may be positive rather than negative.

Equally, the full meaning of the covenant is always relevant, together with the question of who precisely has the benefit and burden of the covenant.

The question of enforcement of the restrictive covenant, particularly by (or against) successors in title, is regularly encountered.

In appropriate circumstances, it may then be necessary to apply to the Upper Tribunal (Lands Chamber) to seek the variation, modification or discharge of the covenant in question.

Damages claims may also arise as a result of breaches of restrictive covenants or an injunction may be a possibility.

Sale contract disputes

We advise both sellers and buyers in disputes relating to the sale of property. This may involve situations where a seller refuses to sell or a buyer refuses to complete a property transaction, even though a contract has been exchanged compelling them to do so.

Ordinarily, the first step may be the service of a notice to complete, making time of the essence of the contract. Common issues encountered include the possibility of repudiatory breach of contract by the seller or buyer; the possibility of an application for specific performance of the contract; and claims for damages arising from the breach.

Service charges

Commercial service charge disputes are based primarily on the terms of the lease itself.

Do the particular works carried out by the landlord fall within the defined list of services? If not, does the service charge fall within the “catch all” provision usually set out in the lease?

Has the tenant’s contribution to the proportion of the overall costs been calculated correctly?

To what extent does the landlord need to act reasonably when deciding whether to carry out a particular service and in passing on that cost?

Has the landlord fulfilled its own obligations to carry out services? If not, to what extent might the tenant be entitled to a refund or to damages?

Have the mechanics for recovery of service charges been followed strictly? For example, have service charge accounts (where necessary) been prepared and certified, properly, or at all?

We regularly guide landlords and tenants on these questions and other service charge related disputes.

Tenancy deposit schemes

Landlords are now in certain circumstances obliged to lodge deposits in an approved tenancy deposit scheme. This secures the deposit and, in general terms, provides a procedure for resolving disputes relating to how much, if any, of the deposit may be retained by the landlord at the end of the term for non-payment of rent or for failure to comply with the terms of the tenancy. We assist both landlords and tenants in relation to such cases.

Tenant insolvency

We regularly advise landlord clients on the implications of tenant insolvency.

The first step is always to establish the precise form of insolvency, whether the tenant is an Individual or corporate entity: this will determine the steps that can and, importantly, cannot be taken.

Inevitably, our advice will also extend to the ability to pursue other parties in place of the insolvent tenant: a former tenant, guarantor or, perhaps, a sub-tenant and whether or not a rent deposit is in place and may legitimately be drawn down upon.

A tenant’s insolvency will often severely inhibit the landlord’s potential remedies as the insolvency legislation recognises that other creditors, not simply the landlord, may be entitled to an appropriate share of what remains of the tenant’s assets.

We also act for insolvency practitioners, often in reviewing (and responding to) threatened litigation on behalf of landlords.

Torts (Interference with Goods) Act

The Torts (Interference with Goods) Act 1977 provides a procedure for landlords to deal with a former tenant’s goods that have been left at the landlord’s property without the landlord’s permission. We assist landlords in serving notice on the former tenant, effectively to give fair warning that the goods must be removed or are liable to be sold. Following the correct procedure is important to avoid claims from the tenant later on for wrongful interference.

Trusts of land (TOLATA)

The court has powers in relation to claims under the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA 1996). This legislation is relevant when relationships break down with the court determining co-habitants rights in relation to property.

Trespass

Squatters are an unwelcome problem for both commercial and residential owners, often having little regard for the property or possessions within.

Speed of action is usually paramount.

We are experienced in expediting court applications against trespassers, minimising, so far as possible, their period of occupation.

Obviously, if police assistance can be used to move on the squatters, without the need for a court application, so much the better.

Vacant possession

Leases will usually contain a covenant compelling a tenant to give vacant possession, which will include leaving the premises empty of both people and chattels. Disputes can arise when this has arguably not occurred. One such instance is in the context of break rights, where a tenant’s right to end a lease early is conditional upon giving vacant possession. Accordingly, the outcome of such arguments can be crucial.

Yielding up

Generally, the test for yielding up is whether the tenant has manifested a clear intention to terminate the lease, and the landlord could occupy the property without difficulty or objection. Arguments in relation to yielding up often occur together with issues relating to vacant possession.