Two recent cases that deal with the relationship between a landlord and tenant will be of interest to clients that act as either commercial or residential landlords.
A High Court decision has significantly strengthened the position of a landlord in relation to a tenant that falls into administration. The Court considered whether the administrator must pay the rent that falls due under the lease of a property as an expense of the administration when an insolvent company is the tenant of a leasehold property. It was decided that the administrator must pay the full rent that falls under the lease, even if the company in administration only uses part of the leasehold property.
Another case highlights the need for landlords to comply fully with the detailed service charge consultation requirements. This is particularly important where the works are major, as non-compliance can result in a drastic reduction in the amount that the landlord can recover from their tenants. Landlords should be advised to use the precedents produced by the Leasehold Advisory Service (http://www.lease-advice.org), rather than attempt to devise their own versions of the various notices required under the consultation procedures.
For further assistance on commercial or residential property matters call Mark Sadler Property Partner on 01708 757575 or email mbs@ker.co.uk