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Worldlife
08-04-2006, 12:36 PM
Wonder if this proposed draft letter is OK or needs correction or clarification

Individual letters to Tenant A and Tenant B served at property.


Dear Tenant A and Tenant B


Housing Act 1988 – Section 21
Assured Shorthold Tenancy - Notice Requiring Possession
Rent Arrears

I refer to my letter of the 23rd February to both of the joint tenants and the guarantor concerning the rent being one month in arrears. I am most disappointed to find that the situation has not been rectified. The position has deteriorated in that the rent is now two months in arrears.

As agreed with Tenant A my husband and I will visit the property at 7.00 pm this evening and will discuss the following issues:-

1. The attached statement “Rent Arrears Tenant A and Tenant B” dated 6th April 2006 showing the rent payments due and the rent payments made from 6th November 2005 until today’s date. The account is currently £1,150 in arrears.

2. County Court proceedings will be instituted against the guarantor for recovery of the debt if the rent arrears are not cleared by the end of the tenancy.

3. You will need to meet me at the Address of Property at 9.00 am on Saturday 6th May to hand over all sets of keys and possession of the property. The check out could take several hours depending on what if any damages are found and the what if any photographs need to be taken of such damage and the time needed to record such information.

4. If you do not hand the property over at this date and time then I will apply to County Court for a Possession Order. There will be additional liability for Court costs and you or your guarantor will be responsible for the rental until the property is handed back to me by you or the Bailiffs.

5. It is understood that Tenant B will not wish to be a joint tenant after 5th May 2006. It is imperative to avoid future liability that he too returns any keys in his possession and confirms that he has vacated the property

I would add that this tenancy was granted on the basis of an outstanding personal reference for Tenant A from the employees Manager who also agreed to be guarantor to the rental agreement. The Manager was acting in his capacity as an employee of a reputable and well known chain of food suppliers .

Wondering if we move into difficulties if the food company should be contacted about a dishonoured agreement guaranteed by their Manager.

PaulF
11-04-2006, 11:59 AM
Oh dear! Just read this!

I hope you didn't send the letter, as it doesn't constitute acceptable wording to be a valid S.21 Notice as it refers to rent arrears, which is Grounds 8, 10 or 12 of S.8.

We're not here to start writing letters for you, so you have two choices. Either serve a valid S.21 Notice on the tenants (no need to on the guarantor, if indeed you actually have one - see below), or a valid S.8 Notice.

The problem with the referencing part of your scenario is that if you let the ternants take up occupation before you gathered all the relevant information there's only one person to blame and that's you! The managee won't be a guarantor unless he signed a valid guarantee agreement in advance and he had sight of the tenancy agreement too, etc. etc. Bit of a mess I would say.

Worldlife
11-04-2006, 13:33 PM
Thanks Paul for your input and I've put my comments on your advice in blue



Oh dear! Just read this!

I hope you didn't send the letter, as it doesn't constitute acceptable wording to be a valid S.21 Notice as it refers to rent arrears, which is Grounds 8, 10 or 12 of S.8.

A Section 21 Notice has been served and this letter was headed S21 as a follow up to that Notice.

We're not here to start writing letters for you,

Paul I do appreciate that! The draft letter was posted to check if there were any fundamental mistakes and you have kindly indicated potential problems - that's what I wanted!

so you have two choices. Either serve a valid S.21 Notice on the tenants Done

(no need to on the guarantor, if indeed you actually have one - see below),

Whilst there is no need to serve the S 21 on the guarantor I thought it reasonable to keep the guarantor updated on the extent of the debt and the steps I was taking to ensure his potential liability was minimised. In these circumstances the guarantor might wish to urge the tenant to comply with the S21 Notice. If the landlord failed to take proper action to deal with the Debt might that reduce the amount of any claim by the landlord against the guarantor

or a valid S.8 Notice.

The objective is Accelerated Possession through the S21 and to claim any outstanding rent or damages (over and above the deposit) using Small Claims County Court procedures. I trust I am correct therefore in disregarding S8 Procedures.

The problem with the referencing part of your scenario is that if you let the ternants take up occupation before you gathered all the relevant information there's only one person to blame and that's you!

Agreed. The proposed joint tenants completed application forms for a tenant verification service. The proposed rent formed a very substantial part of their income and I did not think it would receive approval. I verified the outstanding employee references and the fact that his Manager was prepared to act as guarantor.

The managee won't be a guarantor unless he signed a valid guarantee agreement in advance and he had sight of the tenancy agreement too, etc. etc. Bit of a mess I would say.

The Manager had a copy of the tenancy agreement dated in advance of the beginning of the term. The guarantor subsequently signed the guarantor agreement.

If indeed there are any "technical" flaws on the Housing Law side to what extent, if any , would a Company bear responsibility for losses arising from a contract arranged on the basis of an outstanding reference and a guarantee by one of their senior employees?

For example in this case (allegedly) the tenant fell into rent arrears because of the need to go into hospital and the failure of the Company to pay sick leave during the period of illness.

Ruth Less
12-04-2006, 00:14 AM
A Section 21 Notice has been served and this letter was headed S21 as a follow up to that Notice.

Yes I remember you told us a bit about this tenant in your post of 03-04-2006:


Would not be able to pass any financial tests - income too low. Decision to grant tenancy based on superb reference from his Manager who also offered to be guarantor. Manager satisfied financial requirements. As a precaustion Section 21 issued after tenant fell into arrears due to cashflow problems. Will be discussing with tenant whether to grant a joint tenancy for him and his sister. Issue will revolve around satisfactory guarantors. May decide it best here to leave S21 in abeyance and let initial AST lapse to standard periodic terms

So what I'm wondering is do you feel the need to give him notice again in the letter as otherwise he may ignore the S21 as he may have picked up from you the S21 was served as a precaution so he needs telling you actually mean to act on it.

Worldlife
12-04-2006, 03:32 AM
Ruth Less the letter is not a Section 21 Notice - that was served earlier.

The Section 21 Notice only deals with possession of the property and this letter deals with the financial issues that are also of vital interest to the guarantor. The letter states clearly that a County Court claim will be made for rent arrears owing at the end of the tenancy when either the S21 or the Possession Order is complied with.

A Section 21 Notice only seeks possession after a specified date and this letter sets out the date and time of the proposed handover.

This letter was intended to make it quite clear that a Possession Order will be sought if the property is not handed back by both of the joint tenants.

It has now been established that the sister has one child and is on Housing Benefit and a new joint tenancy is not therefore an option.

Regarding your last paragraph we have in other threads established that S21 may be served as a precaution and have an indeterminate life. This Section 21 was issued on 23rd February with an expiry date after 5th May.

Are you suggesting that after a Section 21 Notice is served the tenant should not talk to the landlord and the landlord should not listen to any proposals the tenant may make?

In these circumstances both parties fully understand the S21 can only be invalidated by a new tenancy agreement.

Thanks for your input

Worldlife
19-04-2006, 09:29 AM
Tenant "A" has now cleared the two months arrears and I am really impressed tht a person on relatively low income took these steps to ensure possible continuation of the tenancy.

I'm not sure about my position here and would appreciate guidance.

The initial period of the AST is coming to an end and Tenant A will be arranging for the keys issued to Tenant B to be returned to the landlord. Allegedly Tenant B has moved away and would not wish to be party to any new agreement. Having regard to the S21 Notice would the return of Tenant B's keys be significant evidence that Tenant B intends to relinquish possession rights? (I have however asked that Tenant B confirms this)

If Tenant A remains in the property after the expiration of the S21 notice and the understanding that Tenant B had departed will the S21 remain valid on Tenant A? What would be the effect of accepting monthly rent from tenant A.

Could the tenancy be allowed to move from the joint tenancy into a periodic tenancy for Tenant A. If that is the intent should the original section 21 be cancelled and a replacement section 21 issued in respect of a new (assumed) periodic tenancy for Tenant A only?

I have to consider also the effects here on the guarantor of the initial joint tenancy agreement.

If I were to contemplate a new tenancy agreeement in the sole name of Tenant A then obviously that new AST would require a new guarantee.

With the positive effort made by Tenant A to clear arrears I am contemplating a "do nothing" policy in respect of a new agreement. Might this be the correct option?

It would however be fair to officially cancel the requirement to meet at the property at the end of the initial period to hand over the keys etc and the threat of immediate Court Action for a Possession Order - (as set out in the first letter on this thread)

Worldlife
21-04-2006, 04:09 AM
Outstanding key questions summarised in S21 Notice/s from LandlordZONE (http://www.landlordzone.co.uk/forums/showthread.php?p=14865#post14865)