Tenancy Agreement Break Clauses

What are break clauses in Tenancy Agreements?

A break clause is a clause in a tenancy agreement that provides both tenant and landlord the opportunity to terminate the tenancy agreement early during the fixed-term (e.g. a 12 month contract gets terminated after 6 months). Essentially, either party can “break” the tenancy before the fixed end date, as long as the correct procedures are followed.

However, it’s important to note, even if the tenancy does include a break clause, the Housing Act 1988 prevents the court from awarding possession to a landlord until six months into the tenancy has passed from the beginning of the agreement, unless the landlord is using one of the seventeen statutory grounds for possession, in which case the landlord has rights to evict the tenant and should serve a Section 8 Notice. So, break clauses typically stipulate that they can only be enforced 6 months into the fixed term of a tenancy, no earlier!

Here is an example of a break clause (please do NOT use it without seeking legal advice):

7.9 Tenancy Break Clause
7.9.1 In the event that the Tenant shall desire to terminate the tenancy hereby created at or at any time after the end of the first six months thereof he shall give the Landlord not less than one months previous notice in writing of such desire and shall up to the time of such determination pay the rent and observe and perform the agreements and obligations on the tenants part.

7.9.2 If the Landlord shall desire to terminate the tenancy hereby created at or at any time after the end of the first six months thereof he shall give the Tenant not less than two months previous notice in writing of such desire then immediately upon the expiration of such notice the tenancy hereby created shall cease and be void.

Serving notice to break the tenancy

The landlord is required to provide at least two months notice to the tenant if they wish to enforce the break clause by serving a Section 21 Notice. So for example, if the tenancy starts on 1st of January, the landlord should serve notice by 1st May (i.e. tenant should have received notice by then), which means the tenant should vacate on July 1st (6 months from when the tenancy began).

If the tenant wants to enforce the break clause, they must also give 2 months notice to the landlord by serving a written notice, known as a tenancy surrender notice. It’s also worth noting that if the tenancy wishes to end the tenancy on or after the fixed term, they only need to provide one months’ notice- that is their statutory right.

Why the break clause is used

Break clauses really are about flexibility for both tenant and landlord. They provide landlords/tenants the opportunity to break a tenancy if personal circumstances change. This could include scenarios such as relocating for work related purposes, changes financial circumstances, or even because the relationship between the tenant and landlord turned sour.

The reason I don’t use break clauses

I personally don’t use break clauses in my tenancy agreements, the reason being is that they don’t seem convincingly reliable (from what I’ve read and been told), which makes them kind of scary to me. Let me explain…

Assuming the landlord is relying on the break clause by serving their tenant with a notice- if the tenant refuses to vacate and remains in the property, the landlord will need to issue court proceedings so they can get a order possession from the Judge. The Judge will then look at the break clause to see if it is valid. If the Judge is not happy with the clause the landlord will not get possession.

Why wouldn’t the clause be valid? The break clause is one of those clauses that can be drafted and interpreted in many ways (apparently). If the clause is clearly drafted and equally fair to both parties, the landlord will have a better chance of getting possession. However, if the clause is poorly drafted and deemed unfair (e.g. if it is in the favour of the landlord), it is very unlikely that it will be enforceable.

To be fully enforceable in law, break clauses need careful drafting with a high degree of legal expertise – these agreements should be drafted by a solicitor or barrister, or obtained from a known reliable published source. But ultimately, every clause in a tenancy agreement needs to be deemed as “fair”

The preferred alternative to a break clause

Personally, I’d rather just issue my tenant with a 6 month tenancy agreement (that’s the minimum term allowed). That way, if the tenant or landlord wishes to end the tenancy, they can do without relying on a break clause. But also, and perhaps more crucially, if the tenant refuses to vacate after a valid possession notice (Section 21) is served by the landlord, the Judge should grant possession immediately, no questions ask, because the tenancy’s fixed term would have.

In the event that after the 6 months both parties are happy to continue the tenancy, then the tenancy can either roll onto a Periodic Tenancy or a new tenancy agreement can be issued.

Issuing a 6 month tenancy just seems much safer and reliable because there’s little margin for error in comparison.

Mutually terminating the tenancy early

If at any point during the fixed term both landlord and tenant agree to mutually terminate the tenancy (for whatever reason), whether there’s a break clause or not, the normal procedure is for the tenant to vacate all his/her possessions and hand back the keys.

In the event that the tenant wants to surrender the tenancy without the landlords agreement, the tenant will be contractually obliged to pay rent for the entire length of the fixed term. Similarly, if the landlord wants the tenant to vacate early while the tenant has no interest, the landlord cannot reposes the property early without grounds for eviction.

Here’s a blog post which covers many of the legal methods of terminating a tenancy.

Do you use break clauses?

Do you use a break clause in your tenancy? If so, I’d be interested to see what it says. Would you mind copy/pasting it? Also, has anyone ever enforced the break clause?

120 Comments- Join The Conversation...

Showing 70 - 120 comments (out of 120)
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Simon Pambin 20th July, 2016 @ 12:47

If I were you I'd approach your landlord sooner rather than later. The fact that he granted a six-month break clause after the tenancy had already begun suggests that he's quite accommodating (if you'll pardon the pun). If you let him know your plans at an early stage, even if you don't make it formal yet, he can start to plan accordingly.

Legally, your landlord would be entitled to recompense for your ending the tenancy early. However, he must mitigate his loss, i.e. he couldn't just leave the property empty for the remainder of the term, make no attempt to find new tenants and just claim the whole rent from you. If you're prepared to make the process of finding new tenants a smooth as possible, e.g. by being flexible in allowing viewings, then you'll probably find that your landlord will be reasonable. There's no point assuming the worst before you've even spoken to him.

The point of a twelve month tenancy is that it provides security on both sides: the landlord knows that, all being well, he won't have to incur the costs of finding new tenants for at least a year and, by the same token, the tenants know that they won't be obliged to leave at a couple of months' notice.

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David 20th July, 2016 @ 20:51

@Gina

If anything people want longer tenancies because for them it is a permanent home not a working holiday home.

You know the personality of your landlord, how were they when you messed them about before by changing your mind?

If they were totally professional and did not get agressive then chances are they will do the same this time. However, this time you are leaving their property empty.

I would just go to them and say that your circumstances have changed as you have a baby on the way and ask what they would like you to do.

Most Landlords want to choose their tenants from whatever source they decide, they may have a recruitment process, e.g. calling up previous references before they do anything with the simple question, the only question you need to ask.

In my life I have given people too much notice only to find they got seriously pissed off, if 2 months is the notice a tenant is given under S21 it is fine for the Landlord.

Bear in mind the condition of the flat, fill all the holes you made, make it easy for them to show the property, I know in Oz you are obliged to do this but in the UK it has to be at a mutually agreed time that is convenient. So suggest two windows of time, say Sunday from 3pm to 5pm and Wednesday from 6pm to 8pm.

If you are going to be traveling light get rid of any junk you have acculated so the flat looks tidy. eBay, Gumtree or Freecycle get this done.

Look at your tenancy, does it require you to clean carpets, BTW not everything in the tenancy is legal, many landlords download tenancy agreements rather than pay the very decent rates this site charges.

Simon is right about mitigating their loss, essentially they can only charge you for actual losses they incur. Go download OFT365 PDF file to get a flavour for how things work here. It talks about wording and says what they prefer. A badly written contract can get all terms invalidated if it does not have terms protecting them.

From what you have said I suspect they will be fine.

Check your deposit is being held in an approved scheme, you should have been given statutory notice of where it is held as well as a certificate. Whoever has it should have emailed or texted you. I mention them because when you leave the Landlord can just authorise you to have the deposit or they can make a case for deductions. The deposit holder determines that and you get to have your say.

Landlords are just like you, they know Shhh IT Happens but they also have a mortgage to pay on your home.

Anything you can do to make the transition easy will be appreciated.

Good luck with it all.

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John 5th September, 2016 @ 20:18

Can someone please help me to clarify this break clause? I have just moved into a new flat on the 5th of August with a 1 year contract and want to know when I could actually leave if i was to use the break clause?

"Any time after eight months of the initial fixed term of this agreement either party may invoke this break

clause by providing a minimum of two months written notice to the other (such notice to expire on the

last day of a rental period of the tenancy). At the end of such notice the tenancy shall end and all

obligations and responsibilities shall cease; subject nevertheless to any claim by either party against the

other in respect of any breach of any of the terms and conditions of the agreement."

-- Does this mean on the sixth month I can write a notice to leave and be out on the 8th month or does it mean after eight months of the contract are done, then I can give a 2 months notice which in total 10 months of my 1 year contract will be done?

Sorry if I have over confused myself this is my first time renting and I just want to get out asap and move back home.

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jose 20th November, 2016 @ 10:56

Hello
Thank you in advance for your help!!

I have a question in relatioan with this...

I have a three month contract, that has begun last 24th of october, so it is running until 24th of january. I have to pay monthly from 20th to 20th (it is also written in the contract, so my 'month' starts on day 20 each month until next 20th).

I have a month break clause agreement written in the contract.

I have a clause that says I have to give one clear month written notice (can a 'clear month' be from 20th nocember until 20th of december? Or it is just from 1st to 1st?)

I have just paid from 24th october until 20th november and from 20 nov until 20th of december which I want it to be my last day.

Is it possible to leave 20 december if I advice just on 20 november? (I have paid for this period) or I have to give notice from 1 december just for 1 of january be my last day?

Thanks!

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David 20th November, 2016 @ 13:03

@Jose

For anybody to comment they would need to see the whole contract.

For example if the contract said notice had to be given on a rent due date or at the end of the month or on the 31st of a month.

Do you see what I mean? Based on what you say so far....

Note, a month runs from 20th to 19th not 20th to 20th.

You make no sense when you say...

"I have just paid from 24th october until 20th november and from 20 nov until 20th of december which I want it to be my last day.

How have you just paid from 24th October to 20th November when that has just passed, are you in arrears already?

Is it possible to leave 20 december if I advice just on 20 november? (I have paid for this period) "

If you just paid from 24th Oct to 19th Nov, how can you have "paid for these period" meaning to December 19th ?

Barring any clauses that contradict you can give notice at any time.

There may be a minimum term and if your break clause refers to it then the minimum term would have to be the earliest point you could leave.

Legally under common law the minimum AST contract period is 6 months, but this is to protect the tenant. If there is a break clause that does not put other conditions then you are free to give notice.

The Deregulation Act 2015 makes provisions and repayment of rent owed back to you, but if you did indeed just pay to the 19th you could give notice today (the 20th Nov) giving a clear months notice.

Again IF nothing in the tenancy says the notice has to be given on the 1st day of the month then you can give it at any time (based on what you have said so far).

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Jose 20th November, 2016 @ 13:21

Thank you very much DAvid for your answer, I will try to explain better because I did not do it properly...

My contract says exactly:

"The 'Term' being subject to "Three months beginning on 24th of october 2016", subject to a month break clause by both Parties after the term has begun. For the avoidance of doubt the Term begins on 24th of october 2016. Should the parties need to discuss an alternative Term outside the Term outlined in this Agreement due to sickness, redundancy, personal circumstances and events of a similar nature this will be discussed where necessary by the parties and where agreed the Owner will provide written consent. In any event, Termination of the Term will be subject to the conditions outlined below.

Termination of the agreement will be granted by giving to the other Party written notice of ONE clear calendar month.

The payment of 680 pounds per calendar month will be payable in advance on or by the twentieth of each month to the owner.

The deposit of 340 pounds will be retained by the owner and as set out in the Terms and Contions overleaf."

So just today, it is 20th and I need to know if I give today the notice that my last day is on 20th of december everything is ok! Or should I say that my last will be 19th?

Thanks for your kind help!!!
Jose.

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David 20th November, 2016 @ 14:31

I am guessing that this is NOT a rental for a flat or house but for a room where the Landlord lives in or a Holiday Let?

Otherwise the contract is illegal, AST min is 6 months for a self contained property.

If it is indeed an AST then the deposit needs to be protected in an approved scheme (DPS, TDS, Mydeposits) within 30 days (by Nov 24th) or you get penalty sanction.

I really need to see the whole contract if you scanned it redacted the details of the parties and address then pasted it to imgur that might help.

So your contract runs from 24th Oct to 24th January, rent is due to be paid a month in advance 4 days earlier. If this were an AST I would not give notice till the 24th just to see if it was protected. Also as your terms run 24th to 23rd I would give notice on 24th anyway.

This contract does NOT look like it was drafted by a Solicitor, it is too ambiguous and not using legal structure.

Landlord does seem open to a variation of term but you need it writing from him.

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Jose 20th November, 2016 @ 21:23

Hello David,

Thanks a LOT for your help...

Here I send you the links to my contract... I have just said today that I would like to finish my contract on 20th of december... I don't know if I did something wrong but my landlord became angry and told me to stay until 1 of january... I have just realized that in the contract it is said 'three month break clause'... so I really don't know if I did well...

Page 1: https://drive.google.com/open?id=0B4GxK72nJxyrMmlEMGJzLUQza0k
Page 2: https://drive.google.com/open?id=0B4GxK72nJxyrX0NrWmM2X0NOd2c
Page 3: https://drive.google.com/open?id=0B4GxK72nJxyrXzE5ck9XcXJxOHc

Yes, as you said, it is a room in his property, he also lives in.

-Can he ask me to stay for the whole duration (3 months until 24th of january?) or can I leave 20th (or 19th I guess) of december if have send today the expected noticed?
-Can he make a contract like this? I mean.. MINIMUM three month contract with a three month break clause...? He also said that in any case, as the contract is for three months, the half of this period is 1,5 months so this would be my 'break clause'

Thank you very much! it is the first time in years I have a problem with a landlord and it is being really a bad experience, specially living in the same place!

Thanks for your advice!

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David 20th November, 2016 @ 22:57

@Jose

Sorry to hear of your experience, it happened to a friend of mine although his was female, went into his room when he was at work and left notes all over the place. Basically she fancied him but he thought she was in need of mental health support!

As a lodger you have far fewer rights, deposit does not need to be protected, locks can be changed once term is over or notice is over.

Your contract seems to differ from what you said above in that it says there is a 3 month break clause. In fact is says
"six (3)" bit the six is crossed out.

So there is no break if the break clause is 3 months and it is a 3 month contract, you just wait for the contract to end.

I would use one of the suggested excuses he offers to end the term early, say a family member is ill and you have to leave the Country. Ask nicely for the deposit back saying you need it as airfare.

"Should the parties need to discuss an alternative Term outside the Term outlined in this Agreement due to sickness, redundancy, personal circumstances and events of a similar nature this will be discussed where necessary by the parties and where agreed the Owner will provide written consent. "

It says here that if he agrees the owner will provide written consent to terminate outside the three months.

So my advice would be to keep him sweet, be nice because clause 3.1 says deposit will be paid at the end of the term (however it ends).

Also says Owner can deduct reasonable costs incurred by any breaches of lodger's obligation.

So he could charge you for him time to put an ad on Gumtree but not a lot.

If you came via an agent then he may be able to charge you whatever his fee is.

I am not sure what he is doing but if you feel threatened you could always call the police, just so that there is a record.

He may be doing this to people to get them to leave within a month and pocketing the 2 months.

So if you tell him you have a family member ill, if he is not reasonable then you might decide to stay for the full term, the deposit will be due back what will then be as soon as he has had time to make sure you have not damaged property. I would suggest you do a joint inventory inspection.

Hope this helps!

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jose 21st November, 2016 @ 00:08

Hello David,
Thank you very much for your help.
Everything is more clear now. I really appreciate.
Thanks!
Jose.

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jimmy 25th November, 2016 @ 19:19

I have a one year AST which began on 2 Feb 2016. The break clause says I have to give one months notice to leave which can't expire after 1Aug 2016. My landlord must give 2 months notice which cannot expire after 1 Oct 2016. Is this fair? When I signed the contract I was told I could leave anytime after 6 months as long as I gave one months notice but the contract says otherwise. Can I do anything about this?

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David 26th November, 2016 @ 00:23

Hi @jimmy

Can you please clarify what you find unfair?

August has passed so you are free to give one month's, the Landlord is giving you more security by having to give you 2 months' notice (which in most circumstances is the law).

As I read it

You started on 02/02/2016

Plus 6 months is 02/08/2016

So you had your 6 months and are now free to give a month's notice.

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John 8th January, 2017 @ 19:22

Can someone please help me to clarify this break clause? I have just moved into a new flat on the 5th of August with a 1 year contract and want to know when I could actually leave if i was to use the break clause?

"Any time after eight months of the initial fixed term of this agreement either party may invoke this break
clause by providing a minimum of two months written notice to the other (such notice to expire on the
last day of a rental period of the tenancy). At the end of such notice the tenancy shall end and all
obligations and responsibilities shall cease; subject nevertheless to any claim by either party against the
other in respect of any breach of any of the terms and conditions of the agreement."

- Does this mean on the sixth month I can write a notice to leave and be out on the 8th month or does it mean after eight months of the contract is done, then I can give a 2 months notice which in total 10 months of my 1 year contract will be done?

Can some one answer this question please? This is a repost..

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David 8th January, 2017 @ 20:59

You give notice on April 5th and it will end June 5th

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Diane Bull 20th January, 2017 @ 04:04

Hi I'm a landlord and stupidly I had a break clause in my tenancy agreement which I didn't understand (until now). I have had tenants since 15th July 2016 on a one year AST. They have just sent me an email stating they are giving me 2 months notice as per my break clause. Should the two months be effective on the 14th (therefore their notice expires on 15th April) or does it expire 2 months from today.
The reason for leaving is that they want a house, not because of any problems between us. Apparently, I'm the best landlord they have ever had!!
I'm a little miffed due to the fact that I have them lots of concessions and although Im sure the place will not be damaged in anyway, it will still cost to rerent. I will need to redecorate etc. (They had brand new decoration, kitchen. curtains and carpets when they moved in.
The deposit is with an insured scheme. Will I be able to keep some of that to offset my costs in re renting etc.
Many thanks

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David 20th January, 2017 @ 09:04

@Diane Bull

So let me get this straight, you have a legally binding contract with a break clause.

The tenant has fully complied with their legal obligations and you expect no issues in any way regarding the condition of the property.

BUT you feel the need to grab some of their deposit?

NO Diane, the deposit is held for the performance of the contract, i.e. damages to the property or non-payment of rent being typical examples.

Maybe next time you could add a "miffed because you made concessions clause", although it would not be legally binding under OFT356 and unfair contract terms!

Diane (and any other Landlord reading this) it is NOT for a tenant to underwrite your business, redecoration is a part of property maintenance. Some people add clauses to require tenants to professionally clean carpets once a year and some add decoration clauses, but they can be challenged and they are not a profit centre if not done.

The same applies to the costs of getting a new tenant, these should be factored into your rent charge.

I would add that, “landlords doing a deposit grab” is exactly why the legislation to protect the deposit protection was created.

The break clause works for both of you; imagine if your circumstances changed and you needed to sell quickly, you would be grateful for that clause.

Now I suggest that you look at the online agents article on this site, particularly about Open Rent so you have as smaller void as possible.

As you have such reasonable and fine tenants you might ask them nicely if they will allow you to carry out viewings in two slots a week (Wednesday evening between 7pm and 8.30pm plus Sunday between 3pm and 4.30pm. Remember, they are under no obligation to let you do viewings unless it is at a mutually acceptable time and date. People do not like strangers traipsing around their HOME, some of who are professional thieves just using the landlord/agent to get access so they can steal an ipad or passport.

If your rent is too low to be profitable you have a few choices,

1. Check the LHA rate for the type of property in your area, the LHA rate is the maximum that benefits will pay and the lowest 30th percentile of rents in the area. This rate may be an indicator that you are not charging enough.

2. Do not just redecorate, invest in property as a "lux pad" and charge a very very high rent to someone of a different class.

3. Change your market, turn the place into a B&B and put it on AirBNB, there will be a lot of voids but you can charge £2k for a week if the property is furnished well enough. Of course be careful of thieves.

Personally I would look at this as an opportunity to refresh the property and increase the rent a bit without being referred for a rent review!

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The Landlord Avatar
The Landlord 20th January, 2017 @ 10:10

@Diane Bull
Respectfully, I'm miffed at what you're actually trying to claim for, other than the inconvenience of your tenant's leaving earlier than you had planned (which doesn't entitle you to financial compensation).

So in short... no, you can't deduct a deposit to cover the cost of finding new tenants in your particular case (or at least, based on what you've said). You said it yourself, you didn't realise there was a break clause, so it seems like you're trying to compensate for your own ignorance (no offence).

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David 20th January, 2017 @ 10:45

@Landlord

I try to think the best of people so I suspect that it is just bad financial planning due to inexperience.

There is a lot on this site that could help her, starting with your investment advice for the type of mortgage, then use of online agents etc plus the hilarious bits in every post.

A lot of people are Landlords by default, they have the flat, get married and decide to rent it out. They do not think of it as a business and sadly neither does the Chancellor with these tax changes.

Like any business where the numbers do not add up you have 3 choices

1. Reduce your costs
2. Increase your prices
3. Get out of the kitchen and cut your losses

Buy to let cars offers 11% !!

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Diane Bull 21st January, 2017 @ 03:47

Wow.I feel properly told off. I was asking for advice not a slating.
Yes, it was ignorance on my part regarding the break clause but Im a fair landlord and I expect my tenants to be fair too.
Ive had other tenants ask to leave before their tenancy expired and not had an issue with it.
It was just because there are a lot of details which I have not posted regarding these tenants, which has left me with rather a bad taste in my mouth and feeling quite frankly, used.

They also had the benefit of brand new, which I feel is quite a selling point. I now have to renew!

So, back to my original question, (part of which you have so eloquently answered)

Do they have to give me notice on the rent day?

As i didnt know about the break clause (definitely my ignorance) I have been googling and it has confused me.

BTW. Googling was were I read that I could claim for my rerenting costs as they were leaving early.. but obviously you cant believe everything you read.

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David 21st January, 2017 @ 10:16

Hey @Diane

Do not take it personally, remember online when someone gets slapped down it is because one is slapping down all the people who have the wrong mindset.

When you explain that you saw it online it means that it is not you that is ruthless exploiter of tenants, just that you had your expectations raised.

Now IF a tenant left early and there was no break clause under OFT356 guidance you can claim your reasonable and actual costs. Some Landlord try it on with all sorts of stupid charges or expecting to pay till end of tenancies but even under common law you have to mitigate your losses.

They have to give notice in accordance with what your tenancy says, so if your tenancy agreement says, you need to post the terms mentioned in there or post a redacted version online with a link to it and I can have a look.

I still do not see how your tenant has been unfair, they exercised a legally binding clause.

Landlords promise long term 5 year rentals but then after a year they decide to sell up and buy something better. It does not matter what they promised, what matters is what is in the contract.

I know how you feel about feeling let down, I have helped homeless people only to have them steal from me, it made me feel foolish for trusting them. Mostly I was upset that they stopped me trusting others.

Getting brand new is just the luck of the draw, personally I would always paint a property on each new letting. As for appliances I would use stock from Freecycle unless I was aiming up market, in which case I might use Gumtree.

This is not your home, it is a business asset, now if you are aiming at the top end tenant and charging double the usual rent then fine, kit it out with a nice oven, fridge freezer and washing machine. Otherwise NO and I will tell you why.

We have seen tenants on here complaining about a toaster not being new, it creates expectation to do too much.

Consider this a learning experience.

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Diane Bull 22nd January, 2017 @ 02:06

Thank you David for your time in replying to me.
i have started to communicate with the tenants but as it was getting a little heated. I have now stopped and will not reply to them until Monday.
Stupidly, the clause in my tenancy agreement is ambiguous. It does not state that it has to be on rent day. But as every other notice does, I am standing by that.
I am also standing by, that they need to give me the notice in writing with both their signatures, an email does not suffice.
They are coming back with ... my cousin works in the industry etc.. and we dont need to do that...

I have let them pay their top up rent late, I changed their payment days to four weekly from calendar monthly due to them being on benefits, and a few other things besides that went against the tenancy agreement.
They are now using the tenancy agreement against me!!
I think that is why I am so "miffed" with them.

BTW. I hadnt seen this forum before, Ive sat here for hours reading the posts. Some landlords, have been taken for such rides. Some tenants too.
Very interesting.

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David 22nd January, 2017 @ 09:16

Hey @Diane

Yep this is a great site, organically grown with the humour of Flossy and the input of many real world Landlords and Tenants.

Now Diane you will know by now that I speak my mind and sometimes it seems I lack that filter because things need to be said. It is not personal, you see a site like this helps people learn from the mistakes of others and hopefully avoid them.

So Diane WTF is wrong with you!

Let it go!

I know you are disappointed that your tenant is leaving but let me break it to you; they are leaving no matter what you do. Punishing them, insisting on things in writing, arguing, it is just a waste of your time and energy.

You say that you have been reading the experiences of others on this site, well one thing you can learn is that if you piss off a tenant they can retaliate. They can increase your voids, not let you in to show new tenants, change the locks, report you to local authority for mistakes you may have made, hell they can cost you thousands if you did not comply fully with the law on deposit protection. These are just the nice things they can do, there are many things they can do that will damage your investment that will not show for now or may cost you money because you have to fix them, Anything from water leaks to a short on the boiler, some will even trash a place.

Now you might be thinking "Those bastards try that and I will sue their arses", well good luck with that.

So take a deep breath, hold it, little bit more and release.

Repeat the above 10 times

If you have been communicating via email forget that and forget trying to LORD it over tbem, let them go, make it easy for them even and be at peace with the world.

Ring them up and say "Sorry about the emails, I thought I would call you as we lose a lot of intonation in emails. Look I have reconsidered and decided I am not going to hold you to notice in writing etc. The fact is you were great tenants and I am sorry to lose you. So let's agree to just work out your departure in an amicable way as possible."

They are NOT using the tenancy agreement against you; they are using a perfectly valid clause that you put in there.

So learn from that, drop the break clause in your next tenancy agreement.

You are not doing them favours taking their payments four weekly, you are doing yourself a favour, they expressed a problem which may make them go in arrears because of the way they are paid and worked with you to find a solution. Some shitheads simply do not pay, then when the money is there in their account they go buy a mobile phone and wham, arrears become acceptable and they grow.

Now you might think you can put any shit you like in a tenancy agreement and it is LAW, well sorry to break it to you but WRONG! You might download an agreement you might even have a lawyer construct one, but there is guidance on this from the Office of Fair Trading on unfair contract terms in tenancy agreement, this document is practically a bible in legal circles because Judges do not want to bring their personal bias to their Court. Also they recognise that there is an inherent power imbalance between Landlord and Tenant at the point of signing an agreement because they are desperate to have a home. Truth is most people will sign almost anything.

Have a read of it.

http://bit.ly/356terms

Now let me get this clear

You have by your own admission an ambiguous statement and you think that just because other clauses are not ambiguous you can ASS-U-ME it applies, well good luck with that!

Let me put this clearly for you

IT DOES NOT STATE IT HAS TO BE ON A RENT DAY

What is STUPID is you thinking you can enforce a term condition that does not exist.

Now you need to get out of this mindset that you are doing them favours or that you can Lord it over them.

Let it go

Let it go

Let it go

This page may help

http://www.propertyinvestmentproject.co.uk/blog/your-tenant-wants-leave-early/

Call them today as advised above, wish them well and the positive karma will wash back over you in due course.

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Diane Bull 22nd January, 2017 @ 16:54

OMG. I feel like Elsa... "let it go"

I just dont like being walked over.

I will let it go.

But they will not get their deposit back early. Or any other concessions, like .. ooh dont worry about that bit of damage!!!!

Thank you once again for your time and comments. Although I havent liked them..xxxx

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David 22nd January, 2017 @ 18:28

No Worries @Diane

The Truth Hurts but Don't shoot the messenger

It could have been SO much worse.

These tenants have done nothing wrong at all, but you still want "payback".

I just hope your deposit was done properly within 30 days and with Prescribed Information within 30 days.

Obviously, if they damaged anything they would face a deduction via the deposit company who will have a method of handling that.

However, fair wear and tear applies and you need an inventory signed by both parties to make that stand, otherwise it is your word against theirs.

On the bright side, once they go you can increase the rent and find new tenants who will be with you for four year. They will always pay the rent on time and you will finally be a happy bunny.

Honestly, if you saw some of the stories on this site, tenants who owed £7k, £5k in legal fees to evice, left the place trashed, then put in a complaint because their junk was put in a skip.

Be happy you had a decent tenant who paid their rent and exercised a legally valid clause in a contract you supplied.

I do tell it how it is and there is nothing personal, I am sure you are a delightful person, really!!

I totally relate to you doing someone a favour and it not being appreciated but that is life. People walk all over you if you are a carpet, still I would not want to change my good nature because of someone else.

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Diane Bull 22nd January, 2017 @ 18:57

Been there, done that, with nightmare tenant. Cost me thousands.

I dont like to ask up to market value for my properties as i think the rents are too bloody high.

And, as for the deposit, it was registered with the DPS in time, but in their insured scheme and im not sure if i sent the correct paperwork to the tenant. This will probably be the next conversation i have.

I try so hard to get things right and there is always something ive missed.

Never mind!

Thanks once again for your help and im sure ill be back with more queries..xxxx

Diane AKA Elsa

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K J Butler 23rd January, 2017 @ 15:27

I have been diagnosed and I now have to give up work temporarily. Our lease is up on 5 Feb 2017. On 1 January we told the landlord we could no longer afford the apartmnt given our change in circumstances. All rent and bills are up to date and have always been paid regularly. We have had to put a small deposit down on a much smaller place and have told the Landlord that the deposit of 750 he can keep even though we are moving out on 26th January (he is currently advertising the apartment from 27th January). We have said that we will pay January's invoices as we always have done.

He is now threatening all sorts and I am due to go into hospital on Wednesday and dont want to leave my partner facing all of this drama as well as everything else he has to contend with. Any advice please?

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David 23rd January, 2017 @ 18:33

@KJ Butler

I am very sorry to hear of your diagnosis and I wish you all the best.

So of course, there are two sides to this, the Tenant and the Landlord

The first is that you have a legally binding contract; it may or may not have a break clause.

It is when you breach the terms of that contract that the fun starts.

The Landlord will think that he can hold you responsible for the whole of the contract, however, he is wrong.

In common law people who which to make a claim against another party have to mitigate their losses. This means that Landlord having been given reasonable notice has to try and get a new tenant in as soon as possible.

There is Government Guidance on Tenancy Agreements produced by the Office Of Fair Trading, it is practically a bible as far as Judges are concerned and parts of it are enforced by Trading Standards.

The guidance says that the Landlord may charge you for ACTUAL losses he sustains but he must do all he can to mitigate the losses. So he can’t go using services that are more expensive just because he expects you to pay.

So if he advertises the property on OpenRent and the property is cleaned to a state where he can move someone in on Feb 1st, then you would be held liable for

1. Cost of Open Rent
2. Cost of cleaning if you left it in a bad way but not if you left if OK
3. The 5 days of rent.

He can't charge you for his time but he can charge you for his expenses such as petrol to get to the property if he goes more than usual.

Remember he can't hold you responsible for charges he would have incurred anyway at the end of the tenancy, such a check out, deep cleaning that he does anyway, decorating that he does anyway.

His tenancy agreement may be full of shit saying you have to do this that and the other, but again the OFT guidance defines unfair contract terms.

There are often several clauses that may affect a situation like this, the Guidance can be downloaded here, http://bit.ly/356terms

As time is short I have written a response for you to send him below.

Now there is no reason to give him your whole deposit, but it should be left with the company he placed it with under deposit protection legislation (he should have given you details of who has it within 30 days of you moving in).

I do not know what you mean by January's invoices, surely your only bill to him is the rent. You must inform the Energy & Water companies that you are leaving on 26th and give them a reading (take a photo as evidence). Same applies to Council Tax.

The WITHOUT PREJUDUCE means they can't use this letter in Court against you although if your lawyer says it is OK you can admit it yourself.

If you have any questions please post back here

=======================
"
WITHOUT PREJUDICE

Dear Mr Landlord

I was disappointed and most peturbed to receive you continual threats regarding our early departure from your property.

We have explained to you that our circumstances have changed dramatically after receiving a medical diagnosis; I really would have expected you to be more understanding.

If we had been less responsible tenants we might have gone into arrears, waited for you to evict us and the Council would have advised us to wait until the very last minute with bailiffs at the door before they housed us.

As it is I have taken advice and I would like to remind you that regardless of what the tenancy agreement says, it is governed by UK Law, specifically common law and unfair contract terms law.

To this end you have a duty to mitigate any losses that you wish to hold us responsible for. This means you must do everything in your power to re-let the property as soon as possible. For your interest, we have heard that openrent.co.uk are a very good online agency that may facilitate your re-letting the property.

As discussed, any shortfall may be claimed against the deposit but if such a claim is exhorbitant we will dispute it.

The Office of Fair Trading Guidance on unfair contract terms in tenancy agreements will be relied upon should you wish to proceed with your threats http://bit.ly/356terms

I want to assure you of our intention to be as cooperative as possible to enable you to get the property re-let as soon as possible but please also bear in mind that this is an incredibly stressful time for us and I am being admitted to Hospital on Monday.

We really want to keep things amicable and would be grateful if you would now work with us to reach a mutually satisfactory conclusion to this matter.

Yours sincerely

KJ Tenant"

=======================

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David 23rd January, 2017 @ 18:38

Just looking at your post again, it says your "lease is up" on Feb 7th 2017 and you are leaving on 26th Jan. So it is just a matter of a few days.

What are all these threats. the deposit would have covered it and he would have had to get a new tenant anyway, so he is going to have very little he can hold you responsible for. Basically, 12 days rent tops, the deposit probably had 4 to 6 weeks of rent, so you have a lot coming back to you.

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Zoe 1st February, 2017 @ 00:31

I have a 3 year lease on my current flat. In september we were told that the landlord was looking to sell the property so there have been people coming in to view the house. We foresee that the property will be sold soon. Both the landlord and us are entitled to a 2 month break clause. however, when the break clause comes into action, it will be a very inconvenient time as we will all be in the middle of exams and we want to move out in july (which will not give us a long enough duration to find a new property)– is there any legal way to extend the notice period? Or is this all just a matter of me having to negotiate with the landlord to hope that they will extend the notice period?

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Zoe 1st February, 2017 @ 00:31

Also, point to note, I have already been in my place for a year and a half.

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David 1st February, 2017 @ 11:32

@Zoe

It is going to depend on the detail of the tenancy agreement regarding break clauses.

You can ask the Landlord if he will consider your request, I very much doubt he will wait 5 months.

You do not actually have to allow viewings, you can be difficult and say it needs to be done at a mutually convenient time, then just refuse every proposed time.

You are entitled to change the locks and your only legal obligation for entry is for gas safety or an emergency leak but you only have to let a bona fide contractor in, not the landlord.

It may be worth checking your deposit was protected within 30 days in an approved scheme and that you received the precribed information within 30 days. If not you can sue the Landlord for up to 3x the deposit but better to use it as a negotiation.

Now he may give you 2 months notice in writing but it is not worth the paper it is written on legally, to evict you he has to issue you with a Section 21 notice, if he has not protected the deposit at all then you can with till the 2 months of the Section 21 are almost up and at that point tell him the Section 21 notice is not legally compliant. To delay things you do not have to say why but wait for him to ask why, then procrastinate saying I can't give you legal advice. BE WARNED if he has protected the deposit he can show the Court that and the S21 will be legal.

If you have not received any deposit protection info you can check the websites of MyDeposit, TDS and DPS enter the month of start of tenancy, your surname and the postcode of the property. Even if it has been protected he has to give you a deposit protection certificate AND the Prescribed Information (some combine this into a 4 page doc).

My advice would be to try and leave sooner, rather than later, start looking now and ask your landlord to release you early with no penalty.

He will get a better price with vacant possession so should be willing to consider it.

If you want to copy the details of the tenancy terms here with regard to the break clause I can be more specific.

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Cameron Holloman 5th March, 2017 @ 18:50

My landlord and I have a fixed lease agreement that was renewed in 10/2016 to extend to 9/2018. Toward the end of 2016, my landlord told me he wanted to sell the property but we agreed that he would only sell to an INVENSTOR and would continue with our current terms and conditions with the same rate ($950/month) till 9/2018.

A few days ago he contacted me and said he found a buyer, however, is not an investor and will be moving into the property 8/201 (13 months early to our signed agreement). The original agreement from when we first moved into the property in 2014 wasn't well written and did NOT include the termination clause should he sell the property he can break the contract early. The new agreement signed in 10/2016 does not either. However, I can't find my original agreement from 2014 which he claims the clause was included.

My question is, since we signed a new agreement on 10/2016, does that overwrite the old contract making it not valid?

He's asking me to provide the signed copy as he DOES NOT have the signed copy either. I really think he's trying to see if I have the original copy because if I don't, he can then add the clause and back date the original agreement. Then, will allow him to sell the property by breaking the agreement without having to honor our agreement time till 9/2018. Does the new agreement that DOES NOT include the clause overwrite the old one and make it no longer valid? This will save me a fight if so...

I'd love to have someone help me out as I am planning on getting married a month after he's requiring me to move out early (9/2017). It's hard enough to plan a wedding... now we have to plan a wedding and find a new place to stay/move out/move in.

PLEASE HELP!

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David 6th March, 2017 @ 00:03

@Cameron

I hope that is not your actual surname there, this IS a landlords forum and your might be about, a message to The Landlord to ask he truncate or even change your name might be an idea.

Also can you please confirm you are in the UK as you are using terminology and currency that suggests you are in US or down under.

I am assuming the $950/month was a typo and that you are in England?

I will continue assuming you are in UK.

"My question is, since we signed a new agreement on 10/2016, does that overwrite the old contract making it not valid?"

If you signed a completely new agreement rather than an extension of the previous agreement then the new agreement stands, but unless you have the agreement he could deny it ever existed.

You yourself use the word renewal, so you need to be clear, was it a completely new contract or just a few pages?

He might even fake a copy of an extension, but if you are in the UK he does not have to as without a legal agreement the tenancy becomes a Statutory Periodic and the terms of the previous contact apply, save dates, which are Landlord must give you 2 months notice and you have to give them 1 month's notice.

If you want to have rights you need paper, but there is another way, bluff and negotiate.

Look, he is going to get you out eventually, so why not say to him "I have taken professional advice and informed that our agreement stands and I am within my rights to resist any attempt to evict me and seek costs if things become protracted.

However, I totally get you want me to move out as does your prospective buyer, so if you are prepared to compensate me for my costs and inconvenience, plus provide me with a stellar reference then I am prepared to start looking for a place now."

Out of pocket expenses may mean he pays for professional removals, any admin fees from an agent, (although I would use Openrent if I were you). Plus a lump sum of anything between £1800 and £7200. The buyer may want to make a contribution to rush things along.

Now if you ARE in the UK and because your landlord and yourself (with respect) seem a little sloppy on the paperwork, then I must ask if the deposit was protected in an authorised scheme?

Even if it was protected in the begining, there is statutory paperwork that has to be issued subject to when the tenancy originally started.

IF you are in the UK and this has been screwed up then there could be a further sanction of up to 3x the deposit to negotiate over.

As I said it depends whether you are in UK?

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Tasha 12th April, 2017 @ 14:39

Can I be offer a two year contract with a years break clause? I have heard of 12 with a 6 month break but not a year?

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David 12th April, 2017 @ 15:14

@Tasha

You can be offered anything the Landlord is prepared to agree to, however, some would prefer to start with a 6m break clause just to make sure you are not a nightmare tenant.

You could offer to sign up for 3 years with a break every 6 months, but any break clause must be for both parties, i.e. either of you could terminate on those dates. If you did not leave the Landlord would then be forced to serve you with a section 21 notice which gives you 2 months further notice. Some would give you the section 21 two months before the 6 month break clause which they can only do after 4 full months have expired.

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Andreas 3rd May, 2017 @ 11:30

We have an AST agreement of an initial term of 12 months and now we are on the 8th month. There is a clause in section 2 saying briefly that the tenants can break the tenancy agreement with two months prior notice after the break clause ends. The same clause for the landlord exists in section 3. For both cases there is no reference on the length of the break clause. Also the term break clause or its length are not defined anywhere else in the tenancy agreement. Can the LL or the tenants use either of the two points to break the tenancy agreement?
Thanks in advance

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David 4th May, 2017 @ 18:07

@Andreas

If there is no break clause then the contract runs to term, sometimes the break clause is included in the Term section.

A break clause does not usually "end", usually there is a contract for say 12 months with an option to terminate early (break) at say 6 months. Some will say that you can give 2 months notice after 8 months regardless of whether there is a break clause.

If you are the tenant you can give your landlord a months notice saying that you will cover his legitimate expenses to replace you.

OFT356 is the Office of Fair Trading Guidance on Tenancy Agreements, it says (in line with common law) that a party suffering loss that they wish to hold others responsible for must mitigate that loss. So they could not just leave the property empty, they need to take all reasonable steps to find a new tenant as soon as possible.

You could call your landlord, explain you have a family emergency or whatever and would like to end the contract early, offer to get a new tenant for them or to line up some (use openrent, Gumtree etc), under no circumstances should you sublet, it would open you up to all kinds of risk.

If you wish to redact a copy of your lease and put it online I can have a look at it but sometimes it is just a case that they wanted 12 months and so deleted the break clause without deleting the reference to it.

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Andreas 5th May, 2017 @ 11:38

Thanks David.

This is the exact paragraph:
2.75 If the Tenant shall desire to determine the tenancy hereby created at, or at any time after the end of the break clause, they shall give the Landlord not less than two months prior notice in writing of such desire and shall up to the time of such determination pay the rent and observe and perform the agreements and obligations on the Tenant's part herein before reserved and contained, then immediately on the expiration of such notice, the present tenancy and everything herein contained shall cease and be void, but without prejudice to the rights and remedies of either party against the other in respect of any antecedent claim or breach of obligation.

Regarding finding new tenants is not applicable in this situation as the landlord will refurbish the flat as soon as we leave (this was made known to us 1.5 month after signing the contract).

Please note that we know a case where the tenants (who are very good friends of us) broke their tenancy agreement using the exact AST agreement template from the exact same letting agency i.e. they used clause 2.75 mentioned above. There was no definition or length of a break clause but the tenants exercised clause 2.75 and broke the agreement. It was for the exact same letting agency but in that case neither the agent nor the landlord supported that it was not legal. Also those tenants where not asked to reimburse the Landlord in respect of any sums which the Landlord was liable to pay to the Agent for introducing the Tenant. Clause 2.24 which was found in their agreement says that tenants have the obligation:
"In the event that the tenancy is terminated prior to the end of the term otherwise than by the lawful exercise of a break clause, to reimburse the Landlord (pro-rata by reference to the unexpired proportion of the term) in respect of any sums which the Landlord has paid or is liable to pay to the Agent for introducing the Tenant"

It was clear that they broke the tenancy agreement using a two month notice and not by mutual surrender between the Landlord and the tenant. Also since they were not asked to pay for the agency fees (3-4 months) this can be interpreted that they used the lawful exercise of a break clause to break it.

For our case both parties say that it is illegal.

Maybe the letting agency has not interpreted that point properly but I don't understand why they accepted the notice in one case and not in the other. Contra proferentem will be against the letting agency who drafted the AST agreement or us tennants?

Based on these further details what is your opinion? Thanks a lot for your time and information you provide.

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David 5th May, 2017 @ 12:47

So what you are saying is that they let someone else off the hook with an identical contract but with you they are sticking to their guns.

I am not sure that Contra Proferentem will apply because it is not so much that the meaning of text is constructed is ambiguous but that the item referred to does not exist.

In such cases the preferred meaning would be the one that works against the interests of the party who constructed the contract, so that would be the Landlord or their Agent. However there would need to be specific and distinct interpretations even if not be immediately obvious.

If there was a clause that said something that gave rise to ambiguity, for example if there was a clause that referred to an initial period of 6 months or a minimum period of 8 months or something that could be construed to mean "break" for example "Early Exit" or "Early Termination".

You might be able to rely on emails or a verbal contract if you were told that there would be a 6 month break clause.

It seems to me that a clause has been edited a few times and this was probably the original term

"If the Tenant shall desire to determine the tenancy hereby created at the end of the first six months to expire on 1st MARCH 2017 and shall give to the Landlord not less than TWO MONTHS previous notice in writing of such desire and shall up to the time of such determination pay the rent and observe and perform the agreements and obligations on the Tenant’s part herein before reserved and contained then immediately on the expiration of such notice the present tenancy and everything herein contained shall cease and be void but without prejudice to the rights and remedies of either party against the other in respect of any antecedent claim or breach of obligation."

Some bright spark decided to take out specificity or make it reliant on "break" clause stated elsewhere but then deleted the said clause.

Sadly I do not think that their mistake by itself gives rise to ambiguity, which is why I am asking you about other terms, I would need to see the whole contract or trust that you have read it till you are blue in the face and found nothing that could be interpreted to mean "break".

It might be that the previous episode really pissed off the Landlord and he told the agent to be firmer.

The reality is that you are not going to take them to Court, the legal fees of someone capable of making a credible argument are way above your benefit.

So what are the alternatives, you stop paying rent and he then has to sue you for money, chances are he will not for the same reason, you then allow him to take deposit by letting DPS, TDS, or MyDeposits know he can have it. He will have his rent for the period you occupied the property and is unlikely to come after you or provide you with a reference. He will (or should) give agent a kick up the arse and perhaps fire them.

If you had some leverage, if your deposit has not been protected within 30 days, if you had not been served with PI within 30 days, then you might be able to negotiate with them by saying you scratch my back and I will scratch yours.

You could offer to paint the flat to save them the cost, a quick splash of £12 magnolia contract paint from Homebase.

I hope this helps.

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Simon Pambin 5th May, 2017 @ 13:03

Have you spoken to your landlord directly or is this all via the agent? Your contract is with the landlord. Agents sometimes seem to forget that. Sometimes they also seem to forget that they're supposed to do what's in the landlord's best interests, not their own. It may turn out that your landlord would welcome the opportunity to start the refurbishment a couple of months sooner, whereas the agent just wants to maximize his commission.

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Andreas 5th May, 2017 @ 13:26

Thanks David and Simon for the interest.

@ David
Yes I have read it and found nothing that means break. Maybe I will give it another try but I think I will end up finding nothing again

@Simon
We have spoken to the landlord and the agency (directly). But of course both of them insist that we cannot break it as there is no break clause.

What might be against them is the fact that our friends who used the exact same tenancy agreement to break it last year forwarded to us an email conversation between the agency, the landlord and them. In one of those emails there is clear reference by one guy from the agency saying that you can use the break clause with two months notice. These are the exact words used by him.
"The earliest you can use the break-clause would be 4th August so you would pay rent up to that point"

How can we proceed? Let the Landlord know about this or let both of the parties know? Currently we are trying to find a mid solution. We already said that the landlord can bring the refurbishment forward as the flat will be in the market sooner. Going to the court will take long and will be costly (although I feel we can win the case)

Thanks a lot guys

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David 5th May, 2017 @ 19:40

@Andreas

Simon is absolutely right, deal only with the Landlord, Agents are mostly useless, the Landlord will make the decision.

You can write to the Landlord with a copy, say you wish to keep things amicable and would like him to reconsider the matter.

If he declines then your options are in my previous post.

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MdeB 10th May, 2017 @ 11:57

I came to this article hoping to get some information on the fairness of some break clauses (example later) and whether they had been tested in court (as the author of the piece also hoped), but there has been no feedback from landlords on success or failure in court with a break clause.

The break clause that caught my attention was of the form:

"The Term: 12 months from and including .

Landlord Break Clause: The landlord may terminate this agreement by giving at least 2 months notice, such notice not to expire before .

Tenant Break Clause: The Tenant may terminate this agreement by giving at least 2 months notice, such notice not to expire before ."

Please do not comment on any ambiguities there may be in these clauses, as they are not relevant to my question.

OFT356 only seems to have the following to say on 'unfairness', and that is in a subsection entitled 'misleading termination clauses':

"3.65 Landlords sometimes choose to use a 'break' clause allowing them to bring
the agreement to an end on service of two months' notice. We would object
to such a term if it was not balanced by a similar provision allowing the
tenant to give notice in the same way."

The above does not fall foul of OFT356.

However, the above break clause appears to have the effect of turning what purports to be a 12-month tenancy into a 6-month tenancy BUT with the disadvantage to the tenant that they have to give 2 months' notice whereas if the tenancy had been for 6 months and became Statutory Periodic, then the tenant would have a shorter notice period.
Therefore the break clause appears (to me) to be unfair.

Can anyone comment on the fairness in this context, and has anyone any knowledge of such a clause being challenged in court?

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MdeB 10th May, 2017 @ 12:08

@David

You stated in an post 46 that a S21 notice is required for a landlord to exercise a break clause

However, it is my understanding that a S21 notice cannot be used in the initial term of a tenancy.

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MdeB 10th May, 2017 @ 12:12

@112

The post did not display as I wrote it (I used 'less than' and 'greater than' symbols as brackets, and the text between them seems to have been stripped). Reposting using square brackets:

The break clause that caught my attention was of the form:

The Term: 12 months from and including [date].

Landlord Break Clause: The landlord may terminate this agreement by giving at least 2 months notice, such notice not to expire before [date 6 months after start].

Tenant Break Clause: The Tenant may terminate this agreement by giving at least 2 months notice, such notice not to expire before [date 6 months after start].

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David 10th May, 2017 @ 18:37

@MdeB

Re post 46, OK there are two things here, the contract between the Landlord and the Tenant and The Housing Act.

So your contract cannot go against common law, i.e. any act.

So your contract says you have a 6 month break clause, you email the tenant 4 months in and say "I'm selling up so I need to exercise my break clause, sorry it did not last longer, leave the place in good nick and I will give you a glowing reference."

The tenant emails back "Ok MdeB, it has been fun but I will find somewhere else"

The two months pass and the tenant does NOT move out, the contract is terminated by the break clause BUT a statutory periodic tenancy was created because they did not leave. Now the Landlord has to give S21 notice with 2 months notice and all the provisos etc blah blah blah.

So the savvy Landlord thinks "I am not going to fall for that again, I am going to give them the S21 2 months before the expiry, in fact I will give it on day 1" Well that is what they WERE doing until the Dereg Act said they have to give 2 months notice and it can't be served until 4 months in (note the cock up here, the tenancy now has to last 6 months and 1 day). Therefore, as I advised previously, the S21 CAN be used in the initial term BUT it must not EXPIRE before the end of six months. Basically no tenant has more than 6 months assured tenancy and even then only the first six months, after that 2 months (via S21).

Now to your phrases, they are fine with OFT356, they both give the same obligation.

It is not unfair that two parties agree to terms specified in a contract that may differ from common law. Common law says a tenant only has to give a month's notice to leave a SPT while the Landlord has to give 2 months and comply with S21 prerequisites (deposit protection, Prescribed Information, EPC, Gas Cert, How to Rent, Blood Group confirmation, HIV Test and clean shaved balls)

With the contract, both parties agree that it is a 12 month contract but either may terminate at 6 months, giving notice to expire after the six months (so after month 4).

So it is not unfair at all, break it down...

The Tenant may terminate this agreement by giving at least 2 months notice,

such notice not to EXPIRE before [date 6 months after start].

So it has to end 6 months after the start.

Let me warn you of one thing, DO NOT CHANGE tenancy agreements that have been produced by a Solicitor. They are constructed carefully, in accordance with and around common law.

I know of a Landlady who did not like the break clause so she added two more, they basically said that if there were arrears at any time the landlord could give 3 days notice and they said a charge of £25 a day would be payable, so if rent were say 4 days late, a fee of £100 would be payable (in their dreams).

The 3 days would breach S21 notice requirements and the £25 a day would breach OFT356 guidance which says the Landlord may only charge Actual costs, so 4% about 2% base rate, so £500 rent x 6% = £30 (per annum) /365 * 4 days =0.33p rounded up.

Landlords can invent any term they like but it can be challenged as an unfair contract term, such a term could void the whole contract if the tenancy agreement does not have protection for that.

So if you want a tenancy agreement, try this one, for £5 you can't complain!!

http://www.propertyinvestmentproject.co.uk/landlord-shop/documents-contracts/tenancy-agreement-forms/

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Michael 10th May, 2017 @ 22:47

@David

1. You seem to say the "Common Law" is Acts of Parliament.
It is not; it is law that is derived from ancient usage and judicial decision.

2. You say in the example clauses I provided "So it has to end 6 months after the start.".
That is not the case; it can be ended at any time after 6 months.

3. Regarding S21: A S21 cannot be used to obtain possession before the end of the fixed term. This is what I had trouble with.
Having researched more, I think the position is "exercising the break clause redefines the fixed term to end on expiry of notice period" and that then allows a valid S21 to be served.
Is that correct?

4, Re Deregulation Act "(note the cock up here, the tenancy now has to last 6 months and 1 day)."
Yes.
I was following the progress of the Bill and made representations to my MP and some Lords on this point (including that service after 16:00 on a Friday is treated as service on the following Monday, so really we needed "cannot be served in first 3 months of tenancy").
One Lord raised this in debate and was assured by the Minister that this would be the case. Just shows that even the guy responsible for the Bill did not understand what he was doing.

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Michael 10th May, 2017 @ 22:51

Ooops. Missed a "not"

Should read "assured by the Minister that this would NOT be the case"

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David 11th May, 2017 @ 10:08

@Michael (formerly MdeB)

1. Don't be obtuse, to all intents and purposes for housing we are only concerned with acts. I am not wasting my time on debating this, next you will have me comparing Latin!

2. Again obtuse but also WRONG; what matters is the "not to EXPIRE before" the law is designed to give tenants a minimum tenancy and a minimum notice. You tried to suggest that it was not fair to tenants, I demonstrated it is in fact fair.

You seem to be struggling with this so I will explain again; S21 MINIMUM notice is 2 months, it cannot be served for 4 months, 2+4=6. Easier that quadratic equations, even a five year old gets it. So earliest is 6 months.

Now you are going on about any time AFTER six months. If you want to be anally OCD I can tell you THAT YOU ARE WRONG! Under the Dereg act it has to be used within 4 months. So it can't be held like an axe over the head of a tenant. Now I know you have trouble with the maths so I will lay it out; S21 MINIMUM notice is 2 months, must be used within 4 months from the date being served, 2+4=6, you see it is the same maths. But for the benefit of others let me lay it out with different variables

Tenant signs a 2 year tenancy on 2017-01-01 , with a break clause saying it may be terminated after no less than 8 months by either party giving at least 2 months notice.

Landlord serves S21 with expiry date 3 month notice on 2017-09-01 so MAY proceed to actual claim for possession (if tenant does not leave) on 2017-12-01, the landlord has until 2018-04-01 to start actual claim for possession.

3. I am not going to get into the definition or validity of break clauses per se in contracts, there is enough case law summation on that. It is very simple, it is a contract, it talks about TERMINATION and lists the conditions that can terminate a contract (subject to common law).

The contract has a TERM, it is FIXED but can be BROKEN with a BREAK clause, got it??

BREAK CLAUSES designed to allow each party to shorten the TERM and TERMINATE the contract, (subject to common law). So the fixed term has now been shortened within the contract and therefore a S21 can be used.

Look to understand Law think of computer programming, DO WHILE, IF THEN ELSE, nest those a few times and there you have it.

4. No I disagree, we do not need to sacrifice a month of tenants rights, all they had to do was to say that when the 21 notice and the Minimum term exceed the tenancy end date then the tenancy end date shall be extended by the appropriate number of days. This is necessary because 2 months notice can vary between 59 and 61 days, the 4 month period can vary between 120 and 123 days, the 6 months minimum period can vary between 181 and 184. So the easiest way to have handled it would be to extend the end date in statute to avoid confusion. Alternatively they can change all the housing law reference to deal in weeks because they are fixed at 7 days. So..

Minimum term - 27 weeks
S21 Notice - 9 weeks
4 Month period - 18 week

It would define things more literally and after 5 years people would get used to it.

Personally I think it is just easier to extend the end date to the appropriate few days:

If((TenancyEndDate<(FourMonthNoticePeriod+S21TwoMonthNoticePeriod),TenancyEndDate=S21ServeDate+FourMonthNoticePeriod,TenancyEndDate=TenancyEndDate+0)

or just a fixed 4 days, hell let's call it a week. Any surplus rent being deductible from deposit.

I would rather not get into a lengthy debate about the rights and the wrongs of each section of law in this place, because the idea here is to help Landlords and Tenants. Suffice to say I have said for a long time that the law in this area is a dogs dinner, some of that will be improved after Oct 2018 when the Dereg act applies to ALL tenancies.

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Jeet 13th May, 2017 @ 22:50

Hi

My tenancy started on 1st of July 2016 and ends on 30th June 2017.

Below is the break clause in my agreement

''It has been agreed by all Parties to this Agreement that after the expiration of 6 months from the date hereof either party
may serve upon the other 1 months notice in writing from a rent due date to terminate this agreement.''

I have sent out a notice for one month to the landlord to vacate the flat on 11th May saying I will vacate on 10th June (i.e one months)

Will I be in any problem ?

If yes how should I handle it ,the agent has all my deposit.

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David 14th May, 2017 @ 05:12

@Jeet

The only problem I can envisage is

"from a rent due date"

If they want to be strict they can say that you should have given notice on the 1st of the month if that is when rent is due. However, under OFT356 guidance clauses need to be equal so I would need to see what it says the Landlord has to do to give notice.

It is a clause designed to extend the notice by up to a month. So to comply you should have given notice on May 1st 2017, but they might not hold you to it. You should have received an email back from the agent confirming acceptance that you will be leaving.

You say your deposit is with the agent, but it should be protected with one of the three deposit holding organisations (DPS, TDS or MyDeposits), you should have received a letter and SMS WITHIN 30 days, from the Deposit Company telling you where the deposit is protected and the reference number. Otherwise the Landlord can be sanctioned for up to 3x the deposit.

Agents often use TDS as the deposit company, but it could be any of them, the deposit needs to be protected until you leave.

At the same time you can expect that there will be a final inspection and inventory of the property before you leave. It is in your interest to video every part of the property to show what an excellent condition you left it in.

This is especially true of anything that may be considered damage, hopefully you took a video of it when you moved in.

If there is any damage the Landlord or their Agent can seek a deduction from your deposit, you can dispute this and the Deposit Company can be the arbiter in such cases OR you can take them to Court (or them you). It is important to note that for some of these you agree to their decision being final, so do not agree if you do not feel you will get a good hearing.

For example if there was a leak in the plumbing that damaged a carpet in month 1 of a tenancy, but the Landlord tries to say you are responsible for the damage to the carpet, you would dispute that. At the same time if you had a party and spilled some wine on the carpet you would be expected to pay for it to be professionally cleaned.

It is always in your interest to leave the property in a better condition than you found it, but you are not liable for redecoration unless you have made it worse than "fair wear and tear".

I hope this helps.

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