Legal Q&A

As a broad principle, obligation to observe or give due consideration to the Service Charge Statement rests solely with RICS members and firms regulated by RICS. Where neither the client nor its surveyors hold RICS regulation, they are under no duty to adhere to its requirements. As a practical reminder, solicitors who are not part of RICS do not have to comply with the Service Charge Statement; however, they ought to recognise that their RICS-registered clients, and/or any RICS-registered colleagues within their organisations, might still be required to comply with the Service Charge Statement......

In this Q& A, the title deeds were not received at all, rather than being mislaid or destroyed. Where deeds are absent or have been destroyed, a first registration application must explain the circumstances that led to their loss or destruction. HM Land Registry assesses each matter on its individual merits, but where the evidence does not convincingly establish those events and place the title’s history beyond doubt, it will usually award only a possessory title. For additional guidance, see Practice Note: Deducing title to unregistered land—stamp duty, mortgages, execution of documents, missing title deeds, sales of part and other considerations. First registration of title if deeds have been lost or destroyed Rule 27 of the Land Registration Rules 2003 ( LRR 2003), SI 2003/1417, was amended by the Land Registration ( Amendment) Rules 2008, SI 2008/1919, Schedule 1, rule 4(1), paragraph 8(1), and recast under the...

A rentcharge is an amount due from a landowner to a third party lacking any proprietary stake or right in that land, and so it clearly differs from ground rent, which a leaseholder pays to the freeholder. Developers frequently used rentcharges to facilitate development and building on land without paying the landowner a premium for it, with the owner receiving an ongoing income from the land instead. The Rentcharges Act 1977 ( Rc A 1977) banned the creation of any new rentcharges, save for narrow exceptions, and mandated that most existing rentcharges would end by the year 2037 ( Rc A 1977, s 3). An estate rentcharge remains one such preserved exception......

Assignment of a lease The disposal of a lease is ordinarily handled in the same manner as conveying a freehold, and any sum or premium given for the assignment (excluding a reverse premium) falls within the scope of stamp duty land tax ( SDLT). However, the incoming tenant’s acceptance of obligations under the lease—such as paying rent or complying with the tenant’s covenants—does not constitute chargeable consideration for SDLT purposes and is disregarded when assessing the tax charge......

A caution against first registration A caution against first registration safeguards an interest in the unregistered land in question. If an application is lodged to register that land for the first time, HM Land Registry will serve the cautioner with formal notice of the application. Any individual asserting ownership of an estate in land, a rentcharge, a franchise, or a profit a prendre, or holding any interest affecting such a legal estate, may enter a caution. A caution against first restriction only grants the entitlement to be informed of an application for first registration and to object to any such application......

Stamp duty land tax ( SDLT) Stamp duty land tax ( SDLT) applies to the chargeable consideration given for a land transaction. A land transaction arises where a chargeable interest is acquired. For SDLT purposes, chargeable consideration has a specific meaning and is set out in section 50 of the Finance Act 2003 ( FA 2003) and in FA 2003, Sch 4. It covers not just cash or money’s worth, but also other forms by which value is provided, whether directly or indirectly, to the land’s transferor......

Service charges Service charges are imposed by landlords to recoup the expenditure they incur in delivering services to a building. The precise manner in which the service charge is organised and administered is defined in the tenant’s lease or tenancy agreement. Usually, the charge meets the expense of matters such as general maintenance and repairs, insurance of the building and, where services are supplied, central heating, lifts, porters, lighting, and cleaning of common areas. The charges may additionally cover management costs borne by the landlord or a professional managing agent, together with contributions made to a reserve fund. Relationship of landlord and tenant The landlord and tenant relationship stems from medieval land law and was at first a matter solely of contract in form. Nevertheless, from very early on, the agreement conferred on the tenant an estate or proprietary interest in the land whilst...

Overriding interests Overriding interests split into two groups...

At common law, A has no entitlement to go onto B’s land to undertake repairs to A’s property. In the absence of an express right, or B’s permission, doing so would constitute trespass. Nevertheless, A does enjoy certain limited rights under the Access to Neighbouring Land Act 1992 ( ANLA 1992). Under section 1(1) of ANLA 1992, if A wishes to enter B’s land to carry out works to A’s land, and B refuses consent, A can apply to the court for an access order, in such circumstances and situations......

The Land Registration Act 2002 ( LRA 2002) introduced a new framework for the law of adverse possession in relation to registered land, as provided by LRA 2002, Sch 6. The revised regime offers greater protection for landowners whenever a claim for adverse possession of land is brought. Simply having adverse possession for a period exceeding twelve years no longer means the land will have been acquired by the adverse possessor. Rather, following a continuous period of ten years’ adverse possession, the squatter may apply to be registered as proprietor of that land under the scheme, as set out therein......

For the purpose of this Q& A, we have assumed that: the asset concerned is a residential dwelling property A and B hold either a freehold estate, or a leasehold granted for a term exceeding seven years A occupies a different dwelling as A’s only or principal residence, in which A has a freehold or leasehold interest A and B are not civil partners of one another and/or are separated in circumstances that are likely to be permanent A is not acquiring B’s interest as part of any business activity of buying and selling dwellings carried on by A the trust to be declared by B in favour of A will take the form of a bare trust arrangement completion of A’s acquisition will take place on or before 31 March 2021 As A’s share of the dwelling, in monetary terms, is £225,000, A will need to provide...

Where a tenant suspects their initial break notice might be defective or invalid, they may issue a further break notice, as explained in Practice Note: Break clauses and notices—service. The legal basis derives from Allam & Co Ltd v Europa Poster Services Ltd, a decision about a landlord giving a notice to quit. Nevertheless, the reasoning is equally applicable to a tenant’s service of a break notice. Set out below is the pertinent chapter taken from Halsbury’s Laws of as reproduced below......

This Q& A raises the effect of a tenant vacating property before the end of a fixed-term tenancy agreement. A tenancy benefits from assured shorthold tenancy ( AST) protections under the Housing Act 1988 ( HA 1988) so long as the tenant — or, for a joint tenancy, at least one tenant — occupies the dwelling house as a sole or principal home. While that position continues, the safeguards of HA 1988 apply; once it no longer does, those protections fall away. However, simply stopping occupation of the dwelling house as an only or principal home does not, in itself, terminate the tenancy. Accordingly, when a tenant moves out, the tenancy does not automatically end. The tenant remains bound to observe and perform the covenants set out in the tenancy agreement until the contractual fixed term comes to an end......

The starting point The starting point is that, where the property comprised in the tenancy is, or includes, premises occupied by the tenant and occupied for the purposes of a business carried on by him, or for those purposes together with others, the tenancy benefits from protection under section 23(1) of the Landlord and Tenant Act 1954 ( LTA 1954). Save for any right of forfeiture, surrender, or the tenant’s service of a notice to quit, the tenancy can only be ended in accordance with LTA 1954, s 24(1), and otherwise not. The practical result is that, when the contractual term expires, the tenancy continues for as long as the premises remain occupied by the tenant for the purposes of a business, and it does so notwithstanding expiry of the fixed term. However, the parties may agree that the tenancy they are to enter into will not...

If, after a landlord has retaken possession of the premises (whether by peaceable re-entry, under a court order, or because the lease has ended by effluxion of time or under a break notice, etc.), the previous tenant leaves goods behind, unless the lease expressly addresses situation, the landlord assumes the role of involuntary bailee of those items and may incur liability for conversion if they sell the goods and set them off against arrears, or liability in damages if they discard or dispose of the goods......

Section 26 tenant’s request for a new tenancy As you will be aware, a business tenancy can be brought to an end by serving a tenant’s request for a new tenancy under section 26 of the Landlord and Tenant Act 1954 ( LTA 1954). The request must identify the date on which the new tenancy is to commence, and the current tenancy ends (subject to interim continuance under LTA 1954, s 64) immediately before the date stated in that notice. A section 26 notice is valid only if given by a tenant holding under: a term of years certain exceeding one year, whether or not continued under LTA 1954, s 24, or a tenancy granted for a term of years certain, and thereafter from year to year. The request must set a start date that is no less than six months and no more than 12 months from the date the...

What are the formality requirements for assigning a commercial lease? There are three principal formalities for assigning a lease. First, the agreement to assign must be in writing and signed, and it must contain all terms expressly agreed by the parties in a single document or, if contracts are exchanged, in each counterpart (section 2 of the Law of Property ( Miscellaneous Provisions) Act 1989 ( LP( MP) A 1989)). Second, the assignment must be carried out by deed, even where the lease itself was originally granted orally (section 53 of the Law of Property Act 1925; Crago v Julian). Third, if the lease being transferred is a registered lease, the assignment only completes once it has been registered at HM Land Registry (section 27(1)(a) of the Land Registration Act 2002 ( LRA 2002))......

Fittings Fittings, sometimes referred to as chattels, are not considered part of the land and, unless there is an express agreement to the contrary, they are not included in the sale of the property. In the absence of any such express provision, and on the assumption that the transaction required vacant possession, those fittings ought to have been taken away by the former landlord prior to completion. The general position regarding fittings left in situ at completion is, subject to the de minimis rule, that the seller must see to it that any goods and rubbish are removed from the property......

Costs under LRHUDA 1993, s 60 As a broad rule, when a notice is given under section 42 of the Leasehold Reform, Housing and Urban Development Act 1993 ( LRHUDA 1993), the tenant who gives it is liable—so far as they have been incurred by any relevant person acting in pursuance of the notice (for example, the landlord)—for that person’s reasonable costs: LRHUDA 1993, s 60(1). In addition, if the section 42 notice later ceases to have effect, or is deemed withdrawn, the tenant’s liability under this section is for the costs incurred by any person only up to that time (the precise ambit is set out in LRHUDA 1993, s 60). Accordingly, LRHUDA 1993, s 60 raises two issues where an error occurs when launching a tenant’s claim for a new lease: Does a purported section 42 notice that is invalid for some reason still fall...

Common law rules of service At common law, methods of service govern notices given under section 21 of the Housing Act 1988 ( HA 1988) to recover possession of an assured shorthold tenancy. However, any contractual service terms in the tenancy agreement can override them, so the agreement needs careful review......