Landlord using break clause advantage for higher rents

[mar268]

Hi All,

 

I had a break clause for 6 months on an AST rental contract of one year duration. I had to vacate 3 months earlier than the 6 months. As described in the break clause, I have given notice of 2 months at the end of first month as required and also agreed to pay the remaining 3 months rent, if they do not find any other tenant and administrative costs incurred by the landlord. After 2 months notice period is over, I was told they found a tenant and took the admin costs from me. I was given a section 21 notice and I have done the checkout process and handed the property on Feb 16 as agreed. But the next day the agent tells me the new tenant has slipped away and I have to keep paying the rent for the remaining 3 months.Also landlord's agent has put the house on the market at 13% higher rent now. (Even in my AST agreement the maximum he can raise was only 7.5% per year, if I were to continue there).

The break clause in the AST renewal agreement does not mention anything about the rent the landlord can ask for from the new tenants.

 

The agent insists he can put the house on market at any rate. I think he is taking advantage of the fact that I agreed to pay the remaining rent for 3 months and being greedy to get more rent. (He probably will reduce the rent he is asking for in the last month, if he cannot find any tenants till then). Isn't this a breach of contract or unfair ? Can he withhold my deposit ?

 

 

Thank you.

[rebel11]

Hi mar

 

Welcome to CAG

 

The guys will advise as soon as they are available.

[Aequitas]

The idea of a tenant's right to break is, as its name suggests, to allow the tenant to break the tenancy, i.e. to bring it to an end. That means a clean break. A right to break that requires the tenant to pay rent until the property is relet is no right to break at all. It requires the tenant to pay rent for a period during which he is not entitled to possession; if that is not an unfair term I do not know what is.

 

Tell the agent that you have taken legal advice and been informed that you do not have to pay rent for any period after your notice expires.

 

If you have paid a deposit there are many who would suggest that you forget to pay the last month's rent in case the landlord or agent tries to use the deposit to cover what they think they are due under the clause. As a law abiding lawyer I could not possibly recommend such a reprehensible course of action.

[mar268]

Thank you. I have paid the last month's rent also as per the notice period + all the administrative costs for re-letting.

 

I thought it would help to write the wording of the rental agreement here.

 

"Either party may terminate this agreement by serving not less than Two calendar months written notice, such notice may be served at any time but will not expire before the minimum term of six months has been completed from the date of commencement of the term there of. On the expiry of such notice this agreement shall end but without any prejudice to any antecedent breach of the terms here of by either party.

 

Strictly with the landlord's or his agents prior written consent and subject to certain conditions that may include the landlord's reasonable costs associated with the re-letting of the premises, the tenant might be allowed to surrender or give up the tenancy before it could be otherwise lawfully be ended. "

 

I have followed the process and gave 2 months notice, he wanted it professionally cleaned thought it was not when I got it and I did it that too and then I paid all the admin costs.

 

 

Many thanks for your help.

[Aequitas]

More incompetent drafting!

 

The first paragraph is fine. It gives you the unequivocal right to break. It is not immediately apparent how the second paragraph follows on. What does the "that" refer to? In any event it cannot cut down the clear right given by the first paragraph.

[mar268]

Aequitas many thanks for your help.

 

While the first paragraph gives me the right to break does n't the phrase "will not expire before the minimum term of six months has been completed " tie me up for 6 months ? I gave the 2 month notice after the first month, so after the notice period finshed, 3 months is left isn't it ?. Sorry if am asking very basic questions on an English phrase but I realised when it comes to law, things can be interpreted many ways.

[Aequitas]

Aequitas many thanks for your help.

 

While the first paragraph gives me the right to break does n't the phrase "will not expire before the minimum term of six months has been completed " tie me up for 6 months ? I gave the 2 month notice after the first month, so after the notice period finshed, 3 months is left isn't it ?. Sorry if am asking very basic questions on an English phrase but I realised when it comes to law, things can be interpreted many ways.

 

I had assumed that the notice expired after the first six months. If if it did and you have paid up to then then you are in the clear.

 

I think you had better confirm exactly what notice you have served and all other relevant details as you do not want to go muscling in without getting it right.

[mar268]

The first 6 months have not completed. We signed a contract for 12 months with 6 month break clause. After the first month itself we had to serve a notice of 2 months. Those 2 months are over now. So in total only 3 months has finished. The question is whether I should pay the rent for the remaining 3 months while the landlord tries to market for a 13% higher rent.

[Surfer01]

If they got another tenant in, that means a new contract was signed that contract superseded your contract so I would imagine their beef is with the new tenenat and not you.

[mar268]

The new tenant had not signed the contract. He had only paid initial nominal deposit. On the day of signing the contract he vanished. They have put the house back on the market now. But they have put the house at 13% higher rent than we were paying. I just want to know if I am still responsible to pay the rent for remaining 3 months though they are exploiting the contract to ask for higher rent from new tenants. They have not paid our deposit and said that they will pay only when the found new tenant since we have to pay the rent arrears until he/she is found.

Edited February 25, 2011 by mar268

[mariner51]

Wantever rent the LL asks for from a new T is between them and the market. If he is not trying to apply a higher rent for you last 3 months I don't understand you. The thread title is misleading. You moved in and a month later gave 2 months Notice and presumably moved out by end of 3rd month, leaving an empty property, contrary to AST which I assume says you should not leave the property vacant for more than 21-28 days for Insurance purposes. I accept you have agreed to pay rent for the full 6 months but the LL & you are both taking a risk by allowing you to move out. Who pays when the property gets vandalised next week? And you criticise the LL for advertising the property at a higher rent. What if he has not increased the rent for several years? Sounds like LL has been generous in his dealings with you.

 

Yes you are responsible for paying 6 months rent, that is a min term for an AST. Without that break clause you would have been liable for 12 months rent.

[mar268]

I have stayed for only one year before and the landlord was there before me (so there is no case of him not raising rent for many years here) and the rental agreement says that as he can only increase the rent by maximum of 7%. The problem is there are a lot of other houses in the market at cheaper rents. He simply is taking the risk since he knows he can force me to pay for the remaining months.

 

He has given me a section 21 notice for possession of the property. I have vacated as per the notice and gave him the possession of the house. I am not sure I am responsible for the house even after I gave the possession as per his notice.

 

Talking about generosity, the house was not professionally cleaned when we got it. The agent told me that also. But still I got it professionally cleaned and left it even though he refused to share the costs. I was charged double the damages for some work which I could have got done for half the money. I have let all it go since I wanted things to solve amicably.

 

Anyway, many thanks for your patience to go through my situation and giving proper advice. I just don't want to be exploited thats all. You have answered my query, thank you.

Edited February 26, 2011 by mar268

[speedfreek]

I don't get this at all?

 

You had a contract to pay X amount per month for 6 months.

 

When you left you agreed to pay the remainder of the contract off up to the break point in the AST which would be however long left @ the agreed X amount per month until you hit 6 months. That's pretty standard and the landlord has agreed to try and re-let the place as long as you cover the agency fees. So that's all fine.

 

Now the landlord has no legal obligation to re-let. Nor can they charge you any more than the agreed X amount a month as written into your contract.

 

If they want to try and re-let @ a hight rent than what you were paying than that's their right as it's their house/flat. But they can not charge you any more than the agreed X amount original rent. Nor can they ask you to pay rent for any period after the 6 month break date has passed.

 

That's correct isn't it?

 

Now what I'd be asking here is

1, can they charge you an admin fee when they have not re-let?

2, does them taking the admin fee discharge me from the obligation of paying the remainder of the rest of the rent?

 

As you will have agreed to pay the admin fee on the understanding that they let the property and thus discharge your liability for the remaining rent (from when they move in up to the date of the 6 month break). If they fail to do that or your liability expires (i.e. the date of the 6 month break passes so you are no longer liable for any more rent payments) then you should not have to pay any fees.