Introduction
This is part two of a two part article that discusses
terms commonly found in residential tenancy agreements.
It does not seek to explain every clause or paragraph
that might appear, but give an easy to digest overview
of why a term may be included. We dive straight
in below.
Part
1 of the article can be found HERE
Access
Tenants have the right to quiet occupation. The
tenancy agreement should state that the landlord
or an agent (such as a tradesman) should be allowed
to enter the property if reasonable notice is given
in writing and the tenant consents. It should also
state that in emergencies this requirement will
not apply.
The
tenant must consent to access. If he does not, the
landlord cannot enter under any circumstances. However,
constant refusal may put a tenant in breach of contract,
so it is not in the interest of the tenant to refuse.
Landlords should ensure that they always keep at
least one set of spare keys.
Transfer
of the lease (assignment) and subletting
Most tenancy agreements would contain clauses preventing
the lease being transferred to anyone else, or the
tenant subletting some or all of the property to
someone else. Allowing the tenant to do either reduces
the control the landlord has over who lives in the
property, what rights the tenants have, and how
they can be removed.
Not
allowing assignment may be deemed "unfair".
One way round it (subjectively) could be to allow
a tenant to end the tenancy if he finds a suitable
replacement and if the landlord's costs are covered.
The landlord can then enter into a new tenancy agreement
with the new tenant. The landlord could be able
to approve the new tenant, but his approval should
not be withheld unreasonably.
Insurance
A tenancy agreement will usually specify that the
landlord should provide building insurance and the
tenant may or may not provide contents insurance
for his own possessions. A landlord cannot force
the tenant to insure the tenant's poessessions,
nor can he specify who the insurance company should
be, or what level or insurance should be taken out.
If
the landlord does insure the property, the tenancy
agreement may specify any prohibited activities
that would invalidate the insurance. The tenant
may be responsible for any insurance premiums as
a result of his action - although this can be difficult
to prove.
A
landlord should give the tenant a copy of the insurance
policy and a summary of key terms so that the tenant
knows what he may or may not do under the terms
of the insurance.
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Tenants'
property left after the tenant has vacated
The landlord cannot (by law) dispose of any property
left by the tenant after the tenant moves out. If
he does, and the property has value, he may be subject
to a claim for damages from the tenant. Most tenancy
agreements therefore have terms that allow the landlord
to deal with property left behind that allow a landlord
to dispose of items with the tenant's permission
(perhaps for a fee payable to the landlord), or
sell them and return the proceeds to the tenant
or to forward them on to the tenant (at the tenant's
cost).
Landlord's
address for service
The tenancy agreement has to include the address
at which the landlord (or his agent) can be reached
for the sake of giving notice. If it does not, then
rent is not due until the address is given.
This
term is particularly relevant for landlords who
are resident abroad or who are owners of property
in England or Wales but who live elsewhere in the
UK.
It
is not a legal requirement to provide the landlord's
address if the property is in Scotland.
Guarantor
It is a good idea always to obtain a guarantee from
a third party if you are in any doubt as to whether
the tenant has the means to pay.
Parental
guarantees are usual. If the tenant or guarantor
is not a householder, then obtain proof of his financial
substance.
A
guarantor can either sign the tenancy agreement,
or he can sign a separate document that brings the
guarantee into the contract. A guarantor is only
liable on the terms when he signs, so if the terms
change (for example, the rent) he will need to sign
new documentation.
A
further safeguard against an absconding tenant is
to obtain a parental address, even if the parent
is not guaranteeing the payment. The address given
when the lease is signed is by definition, an old
address!
Forfeiture
A forfeiture term is essential because it allows
a landlord to evict a tenant during the fixed term
under specific certain circumstances (as laid out
in Housing Act 1988 or the Housing (Scotland) Act
1988).
A
forfeiture clause ends the tenancy agreement, but
doesn't give the landlord any rights to re-enter
(which can only be done by a court bailiff or a
Sheriff Officer in Scotland after a possession order
has been given by court). So if a tenant fails to
pay rent, the tenancy may end but the tenant might
stay on living at the property. To evict the tenant,
a court order would need to be sought.
Forfeiture
clauses are often drawn badly, rendering them "unfair"
and therefore void. The circumstances under which
the tenancy become forfeit, and the process that
will be followed if it does need to be clear, reasonable
and not contravene statute law (for example, state
that the landlord has a right to re-enter).
Inventory
(or schedule of condition)
Even in unfurnished properties, an inventory is
usually made for the carpets, fixed installations
such as sinks and baths, windows and doors, and
the decor. For furnished properties, the inventory
would also include items of furniture and soft furnishings
such as curtains and lampshades.
The
inventory is a record of state. The state of cleanliness
of the property is recorded, as is every item and
it's condition. It is common for the inventory to
record gas, electricity and water meter readings,
and also the date and result of tests on electrical
items (such as a refrigerator).
The
inventory prevents either the landlord or the tenant
disagreeing about the original state of the property
at the end of the tenancy. A landlord will usually
commission an independent (and hopefully impartial)
inventory clerk to make the inventory so that there
are no claims that the landlord pressured the tenant
into accepting it. It is a good idea to have the
inventory made while the tenant is present in the
property (so that he can contest any incorrect descriptions)
and to take photographs of the condition of rooms
and valuable items. Photographs need to be clear
and include a ruler or other measure to show scale,
especially of existing damage.
The
inventory should be signed and dated by both the
landlord and the tenant and a copy attached to the
tenancy agreement.
The
tenancy agreement should state that an inventory
will be prepared, who will prepare it and who will
bear charges relating to the preparation. The tenant
could be reasonably expected to bear half the total
costs (of both an inventory at check-in and at check-out),
but it a term that makes the tenant bear all costs
would be likely to be deemed unfair and void under
the Unfair Contract Terms Regulations.
Further
information and useful documents
If
you require a tenancy agreement template,
you may be interested in looking at our collection
of assured shorthold tenancy agreements, or
our residential tenancy agreement drafting
service .
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