Can a Landlord End a Tenancy When Terms Do Not Allow?
The Court of Appeal recently had to deal with a case which turned on a simple point- if the agreement for a tenancy purports to preclude the landlord from bringing the tenancy to an end unless the tenant falls into arrears of rent or commits another breach of the agreement, can the landlord ignore that clause and bring the tenancy to an end by service of a month's notice to quit?
In 1993, a Ms Berrisford entered into an 'occupation agreement' with a housing association to rent a flat at £89 per week. She lived there for several years, then in March 2008 she received a notice to quit, the validity of which would be unquestioned were she the holder of a monthly periodic tenancy.
In reality, the landlord did not want possession of the property, but wanted to negotiate a higher rent. This was subsequently agreed at £171 per week. However, the case proceeded because the housing association wanted to know the legal status of its rental agreements. It has (as do other housing associations) many agreements containing a clause which states (or states in similar terms) that 'This Agreement may be brought to an end by the Association by the exercise of the right of re-entry specified in this Clause but ONLY in the following circumstances:-
If the rent reserved hereby or any part thereof shall at any time be in arrear and unpaid for 21 days after the same shall have become due;
If the member shall at any time fail or neglect to perform or observe any of the stipulations conditions or provisions contained in this Agreement which are to be performed and observed by the Member;
If the Member shall cease to be a member of the Association;
If a resolution is passed unde the Association's Rules regarding a proposal to dissolve the Association
THEN in each case it shall be lawful for the Association to re-enter upon the premises and peaceably to hold and enjoy the premises thenceforth and so that the rights to occupy the premises shall absolutely end and determine as if this Agreement had not been made (but without prejudice to any right of action or remedy of the Association).
The question was, could the housing association rely on the above clause to serve a notice to quit on a tenant who did not breach its terms?
The Court ruled (by a 2-1 majority, and with LJ Aikens stating that he reached his conclusion 'without enthusiasm') that despite the clear intent and wording of the clause, the landlord was able to bring the tenancy to a close by issuing the appropriate notice and the clause did not act to prevent the landlord from so doing.
In his judgment, LJ Mummery suggested that this area of law might benefit from a revisit by Parliament, as it is clear that the impact of landlord and tenant law generally has acted to override a term that was agreed between landlord and tenant and which seems perfectly clear.
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