Leases - it is easy to underestimate their importance. They survive the lifetime of your tenancy, and even if you’ve paid a considerable premium to own your dream flat, compliance with the terms of a long lease is as important as it is in a short letting.
A lease is a special type of contract – one which grants you the right to live in your home, subject to certain rules. It might seem peculiar that you can buy a flat for an open market value and still be subject to a landlord’s rules, but efforts to introduce alternative ownership structures, such as commonhold, have so far been unsuccessful.
Your lease may expressly permit you to do certain things, usually to do with repairs, alterations, the use of your property or assigning your lease, or it may say that you can only do things with your landlord’s consent. Even if something is expressly prohibited, there is nothing from a legal perspective stopping your landlord giving you permission – they are just under no obligation to grant or even consider your request. You may also see that consent is not to be unreasonably withheld, delayed, or a variation on this theme. In these circumstances, your landlord must consider your request for consent but, provided they act reasonably, they are not obliged to grant it.
Is anyone going to know?
The cause of the problems in this area is when tenants disregard the need for consent and go ahead anyway. ‘We don’t really get involved with the landlord’, ‘the Joneses upstairs have done much more than we have’, ‘it’s not like anybody is going to check anyway’ are all thoughts which could easily cross your mind, but which can all come back to haunt you later on down the line if you breach your lease.
The most likely time for these issues to surface is if you come to sell your flat. Your buyer is likely to have the flat surveyed and compared to the lease plans – and if there are any discrepancies, they will want to see the consent granted by the landlord. If it is not correct, or if it does not exist at all, they are unlikely to want to proceed with the purchase (or at least not at the initial asking price).
Also, your lease probably permits your landlord to inspect your property to ensure that the lease is being complied with. In the event that, say, you have altered the flat in breach of the lease, your landlord can require you to put it back to the way it was – at your own expense.
Deeds, not Words
One particular matter I dealt with illustrated the issues which can arise when consents are not documented correctly. A tenant had carried out alterations to their leasehold flat, having obtained their landlord’s consent by email. However, the lease provided that consent was only valid if it was given by deed and signed by both parties. Draft documents were drawn up, but never signed - meaning that the only evidence the seller had that they had received consent was an exchange of emails, which was insufficient. When the tenant came to sell the flat, they were in breach of their lease and their prospective buyer insisted on the tenant obtaining a retrospective consent in accordance with the lease, at their own cost.
Unfortunately for the tenant here, the prospective buyer was within their rights to walk away from the sale (as no contracts had been exchanged) on discovery of a breach of the lease. While it is arguable that the requirement for consent had been waived, and that is dependent on the facts of each individual case, this still poses two problems – obtaining a declaration to this effect from a court could be very expensive, and the very existence of the problem could be enough to scare off a potential buyer. While it is difficult not to feel sympathy for the tenant here, the answer is to ensure that the consent is properly documented at the time.
It is important to always check your lease for whether any consent is required, and to comply with its provisions. Although you are likely to be required to pay your landlord’s costs of dealing with the request, the potential cost, time and stress implications of obtaining retrospective consent or undoing your alterations are likely to be far greater.
Grant Duranti, Trainee Solicitor at Pemberton Greenish LLP