Does the Landlord and Tenant Law Benefit Tenants - Essay Example

Evaluate how far the provisions of the Landlord and Tenants (Covenants) Act 1995 can be said to benefit tenants to the detriment of landlords? The property disputes are quite common now a days and lack of proper legal provisions may complicate these problems further (Rotherham, 2000). Landlord and tenant problem is one of the common property disputes witnessed by us through out the world (Canadian Legal Information Institute, 1973). The landlord tenant issue has become a serious problem in several occasions where transactions regarding the lease are involved. The issues of landlord and tenant were witnessed even during 1940s immediately after the Second World War period as in case of Central London Property Trust, Ltd v High Trees House Ltd (1945). In this case the landlord couldn’t insist his legal right to charge a full rent strictly due to the war situation and its negative effect on occupancy in his flats. In United Kingdom, several landlord and tenants acts have been enacted to provide right direction and legal instrument for solving the problems related to landlord and tenant matters1. The need for reforming landlord and tenant act was also felt in countries like Ireland and accordingly law reform commission was established in the year 1975 (The law reform commission, 2003). In July 2001, this law reform commission established landlord and tenant project aiming at reforming the landlord and tenant law. In United Kingdom also there were repeated efforts for reviving the law related to 1 Thompson, S & Holt, SL 1995, ‘Landlord and tenant (covenants) act 1995’. Sweet & Maxwell publication, ISBN: 042155410X. landlord and tenant acts. For example, landlord and tenant acts were introduced in 1709, 1730, 1851, 1927, 1954, 1985, 1987 and 1988. The objective of all these acts is to ensure the genuine interests of both the landlords and tenants according to the agreement made between them. However, the specific aim of these acts is to reduce the exploitation of tenants by landlords. Over a period of time, the necessity for reforming the laws related to landlord and tenants is felt and accordingly the Landlord and Tenant (Covenants) Act 1995 was enacted. The contribution of Landlord and Tenant (Covenants) Act 1995 is highly significant in reducing the problems faced by the tenants from the landlords (Office of Public Service Information, 1995). With the inclusion of several provisions under the Landlord and Tenant (Covenants) Act 1995, the government of United Kingdom ensured the interests and rights of the tenants and it legally protects their rights in sharing the lease of the property and landlords cannot force them to vacate whenever they wish to do so. The critical analysis of the provisions of the said act is essential so that the benefits accrued upon by the tenants can be assessed. Let us discuss one by one. The Landlord and Tenant (Covenants) Act 1995 came in to force in the year 19952. Section 3 to section 16 and section 21 of the Landlord and Tenant (Covenants) Act 1995 applies to new tenants only and section 17 to section 20 are applicable to both old and new tenants. Schedule 3 of the Landlord and Tenant (Covenants) Act 1995 declares about 2 Morris, JR, Morris, JR, Dobson, P, Gravells, N, Kenny, P & Kidner, R 1999, ‘Principles of landlord & tenant’. Routledge Cavendish publication, P:410. ISBN-10: 1859413846. the transmission of advantages and burden of covenants (Waterson, 1996). It states that the benefit and burden of all landlord and tenant covenants of a tenancy would be annexed and applicable to the whole premises or partial portion of the premises regulated by the tenancy and of the reversion in them. This clearly illustrates that the act is applicable to either full portion or partial portion of the premises defined under the agreement depending upon the context. Hence the Landlord and Tenant (Covenants) Act 1995 can be said to be beneficial to the tenants as it defines the operational areas of jurisdiction and landlords cannot cheat the tenants deviating from the rules of the agreement made. Similarly the schedule 3 also states that in cases of the formation of assignment on behalf of tenants under the tenancy, the assignee becomes bound by the tenant covenants of the tenancy. However, it has exceptions like (1) No binding on behalf of assignor was done immediately before the assignment and (2) The demised premises don’t constitute the portions or limits mentioned in the assignment and premises definition. In addition, the land owner wouldn’t be entitled to use the demised premises during the period of contract and the tenants interests can’t be violated by the landowners (Waterson and Lee, 2001). The schedule or section 5 of the Landlord and Tenant (Covenants) Act 1995 describes about the conditions for tenant release from covenants when tenancy is assigned. This section is applicable where a tenant assigns premises demised to him under a tenancy. Of course, the tenant gets released from the tenant covenants of the tenancy if he is assigned the whole of the premises demised to him, otherwise, the tenant ceases to be entitled to the benefit of the landlord covenants of the tenancy. This provision is highly beneficial for the tenants when they wish to get released form the covenants and hence they get legal protection from the clutches of the landlords. Similarly, section 6 of the act suggests that landlord may be released from covenants on assignment of reversion in cases of assigning the reversion in premises of which he is the landlord under a tenancy. It also clarifies that the in case the landlord assigns the reversion in the whole of the premises of which he is the landlord he can put an application for getting released from the landlord covenants of the tenancy. Moreover, in circumstances in which landlord is released from all of those covenants in the manner mentioned above, he certainly ceases to be entitled to the benefit of the tenant covenants of the tenancy as defined in the assignment. This also benefits the tenants as it clearly defines the circumstances in which the landlord can exercise his release options from the covenants and hence the tenants would be prepared for the same. Section 8 of the Landlord and Tenant (Covenants) Act 1995 also benefits the interests of the tenants as it defines the procedure for requesting for release from a covenant under section 6 and section 7 of the act mentioned above. It clearly states that the notice has to be served on tenant with in four weeks beginning with the date of the assignment in question and the tenant has to be informed about the proposed assignment or contract along with the request for the release of the covenant. The Landlord and Tenant (Covenants) Act 1995 certainly protects the genuine interests of the tenants because its section 8 ensures that the application for the release of the covenant is considered to be accurate only if the tenant expresses consent for the notice and only if tenant doesn’t object to the assignment with in four weeks after the date of serving notice to him. In cases where the tenant serves the notice to landlord objecting the conditions of assignment with in four weeks after the date of issue of assignment and in cases where the court also accepts the conditions for the objection of the tenant, the release of covenant wouldn’t be considered. Hence, this provision is significant in ensuring the genuine interests of the tenants and avoids the exploitation of the tenants by the landlords. However, in cases where the landlord commits a personal promise or obligation to the tenant, he cannot apply for release from the landlord covenants of the tenancy by serving a notice on the tenant under section 8 of the Landlord and Tenant (Covenants) Act 1995. This because of the fact that a personal obligation of the original landlord would not be considered as a landlord covenant as stated in case of BHP Great Britain Petroleum Ltd v Chesterfield Properties Ltd (2001)3. Section 9 of the Landlord and Tenant (Covenants) Act 1995 provides immunity to tenants by declaring the apportionment of liability under covenants binding both assignor and assignee of tenancy or reversion. This is very important because several times a situation may arise in which the tenant and landlord may develop differences due to the specific demarcation of the premises under contract. The section 9 of the Landlord and Tenant (Covenants) Act 1995 is applicable if a tenant assigns partial portion of the premises demised to him by a tenancy and in cases where after the declaration of the assignment both the tenant and his assignee are committed to a non-attributable tenant covenant of the tenancy. Section 11 of the Landlord and Tenant (Covenants) Act 1995 states regarding the operation of law in cases where assignments involve the breach of covenants. Whatever the procedures or preconditions 3 BHP Great Britain Petroleum Ltd v Chesterfield Properties Ltd (2001) EWCA CIV 179 defined in the earlier sections of the act, if they are not satisfied, the law would be enforced under this section and hence it protects the interests of the tenants successfully in cases where landlords don’t meet the terms of the assignment. Similarly, the section 13 of the act declares the conditions for the covenants binding where two or more persons are involved. It states that in cases where the two or more persons are bound by the same covenant, they are considered to be bound both jointly and severally. The Landlord and Tenant (Covenants) Act 1995 also protects the interests of the tenants in the form of provisions stated under section 15 of the act which declares the preconditions for the enforcement of the covenants. This is very crucial section as it relates to the terms and conditions of the enforcement of the covenants. It states that the any tenant covenant of a tenancy is enforceable by the reversioner with respect of any premises demised by the tenancy. It is also enforceable other persons who for the specific period of the time is entitled to the rents and profits under the tenancy in respect of those premises. It is also enforceable in cases of any mortgagee in possession of the reversion in those premises. The same conditions apply for the landlords also as this section states any landlord covenant of a tenancy is enforceable by the reversioner in respect of any premises demised by the tenancy, or by the tenant in respect of any premises demised by the tenancy. Of course, just like in the case of tenants, the landlord is also enforceable by any mortgagee in possession of those premises. Some other important sections of the Landlord and Tenant (Covenants) Act 1995 affecting the interests of the tenants are section 16, 17, 18,19,20 and 25. Section 17 of the Landlord and Tenant (Covenants) Act 1995 states about the restriction on liability of former tenant or his guarantor for rent or service charge. In several cases in United kingdom including Scottish & Newcastle Plc. v Raguz4 , the judiciary takes the interpretation of this section. Hence the section 17 of the Landlord and Tenant (Covenants) Act 1995 is very crucial section that positively contributes for the welfare of the tenants. According to this section, the preconditions where the former tenants have to pay the rent and service charge are defined clearly. According to this, the former tenant shall not be liable under that agreement to pay any amount in respect of any fixed charge payable under the covenant if the landlord doesn’t serve him the notice within the period of six months starting with the due date. The landlord should also inform the tenant about the amount of rent due till date and the accrued interest calculated as per the specifications under the act. Hence this section provides tremendous immunity to the tenants in protecting themselves from the clutches of landlords in cases of any manipulation. The section 18 of the Landlord and Tenant (Covenants) Act 1995 mentions about the restriction of liability of former tenant or his guarantor where tenancy subsequently varied and the section 19 states about the right of former tenant or his guarantor to overriding lease and the section 20 specifies the supplementary provisions of the overriding leases. Most importantly, the section 25 of the Landlord and ----------------------------------------------------------------------------------------------------------- 4 Nabarro 2007, ‘Section 17 Landlord & Tenant (Covenants) Act 1995: Recovery of increased rent following rent review’. Dispute Resolution briefing dated 24 April 2007. http://www.nabarro.com/Hot_Topics/Section_17_Landlord_&_Tenant_(Covenants)_Act_1995.html. Tenant (Covenants) Act 1995 clarifies the conditions for declaring the agreement as void if any act on behalf of assignor or assignee restricts operation of the Act. If the assignor or assignee violates the provisions of the act, the tenancy would be considered as terminated and penalty may be imposed on the party which is guilty. In this way, the section 25 of the Landlord and Tenant (Covenants) Act 1995 serves as a regulator for protecting the genuine interests of the tenants. Some times, the landlords may not fulfill the minimum standards required for living condition of tenants and tenants may opt for surrender from the agreement showing the genuine reason of faulty repair and ill maintenance. If landlords deny surrender, they may be forced to accept the surrender as in cases like Art world Financial Corporation v Safaryan (2009), where the landlords tried to take advantage by not accepting the surrender by operation of law. The court stated that once the house was surrendered by the tenant and landlord used it by opening the premises, it would be considered as the surrender is accepted by the landlord. Overall, it can be concluded the Landlord and Tenant (Covenants) Act 1995 is instrumental in ensuring the genuine interest of the tenants and it provides tremendous extent of immunity to the tenants from the exploitation of landlords. Though several sections the Landlord and Tenant (Covenants) Act 1995 provide guidelines for the proper release of covenants and agreement between tenants and landlords, some sections like section 8 (by providing preconditions for formation of assignment and serving notice), section 11 (by operation of law under circumstances of deviation from legal provisions), section 15 (by providing preconditions for enforcement of covenants) and section 17 (by providing immunity to former tenants) can be considered as milestones in providing benefits to the tenants. References Art World Financial Corporation v Safaryan (2009) EWCA CIV 303. Central London Property Trust, Ltd v High Trees House Ltd (1945) KB 130. Canadian Legal Information Institute, 1973, ‘Landlord and tenant act’, R.S.N.B. 1973, C. L-1. Office of Public Sector Information, 1995, ‘The Landlord and tenants (Covenants) act 1995’, Chapter 30, Preamble, http://www.opsi.gov.uk/ACTS/acts1995/ukpga_19950030_en_4. Rotherham, C 2000, ‘Restitution and Property Rites: Reason and Ritual in the Law of Proprietary Remedies,’ Theoretical Inquiries in Law: Vol. 1 : No. 1, Article 7. The law reform commission, 2003, ‘Consultation paper on general law of landlord and tenant’. LRC-CP-28, Dubmlin, Ireland. Waterson, G 1996, ‘The landlord and tenant (covenants) act 1995’. Property Management, 14(2): 35-39. Waterson, G & Lee, R 2001, ‘Repairing obligations’. Property Management. 19(4): ISSN 0263-7472. Waterson, G & Lee, R 2000, ‘Restrictive Covenants’. Property Management, 18(2): ISSN 0263-7472. Waterson, G & Lee, R 2000, ‘Business tenancies’. Property Management, 18(5): ISSN 0263-7472. Read More