Lease of flat absolutely prohibits subletting

[lena]

I found myself in breach of my Lease which contains an absolute prohibition against subletting of my flat. I mistakenly assumed that I was covered by S.19 (1) and sublet the flat on 1 year AST, giving F a written notice. It turned out that S.19 applies only to a lease which restricts assignment/underletting 'without licence or consent' but has no application to an absolute prohibition as in my case.

The F's solicitors are now asking for £1000 'in consideration for the Landlord's permission to sub-let' + legal cost F has incurred already in relation to the breach of Lease and in preparation and completion of any future licence.

F is also considering enetring into a deed of variation for a consideration of £6,000.00 which will permanently amend the Lease. Again, I will have to pay F legal cost on top of £6k.

Is an absolute prohibition against subletting a common thing? How can this be legal to start with? All the treads I read on the Forum were about licence/consent, and the admin charges in relation to getting such consent from F.

Any advice or comment will be very much appreciated. Thank you.

[Gordon999]

Who is your freeholder Company and who owns this company ? Who are the solicitors making extortionate demands ?

Have you search all the previous forum postings for "subletting without consent" ? I am sure your type of problem situation has been discussed recently.

1. Make a complaint to your local MP about extortion demand under the lease and call for full conversion to Commonhold and get your MP and yourself to make a complaint to the Solicitors Regulation authority.
Leasehold abuse is hot news with the recent BBC exposures on Peverel Management ( see www.thetruthaboutsolitaire.co.uk )

2. Apply to the LVT for a reduction of consent fee !

3. How many flats in your block ? Do you know the other flat owners ?
How many years left on your lease ?

4. Organise a RTM with 50% of other flat owners to take over the administration of service charge under your lease. This will stop extortion.

[jeffrey]

2. Apply to the LVT for a reduction of consent fee!

No. It has no jurisdiction here: only where the lease contemplates consent, not where the prohibition is absolute.

[lena]

Who is your freeholder Company and who owns this company ? Who are the solicitors making extortionate demands ?

Have you search all the previous forum postings for "subletting without consent" ? I am sure your type of problem situation has been discussed recently.

1. Make a complaint to your local MP about extortion demand under the lease and call for full conversion to Commonhold and get your MP and yourself to make a complaint to the Solicitors Regulation authority.
Leasehold abuse is hot news with the recent BBC exposures on Peverel Management ( see www.thetruthaboutsolitaire.co.uk )

2. Apply to the LVT for a reduction of consent fee !

3. How many flats in your block ? Do you know the other flat owners ?
How many years left on your lease ?

4. Organise a RTM with 50% of other flat owners to take over the administration of service charge under your lease. This will stop extortion.
Thanks Gordon,
I will send you the names of F + Solicitor in a private msg. Thanks for your advice. Searched the Forum on 'subletting without consent' - not really anything similar to my position unfortunately as I already entered AST and in breach. All the options you suggested (option2 is non-starter according to Jeffrey) will take time, I only have 14 days to resolve the situation or F is starting an LVT procedure against me. Found 2 LVT cases with similar circumstances and both cases were won by F and the breach of covenant was established by LVT.

Feel like I have to pay £1000 + legal fees (the amount I need to establish before considering to pay). Or terminate an AST (on what grounds?) I can not live in the flat due to personal circumstances, my husband and I work commitments plus the flat is too small for us - only 1 bedroom. What F and his Solicitor is demanding is utterly immoral but not illegal it seems...

I have 78 years left on the Lease. There are 50 lessees, all flats are fragmented, only know a couple of the flat owners (know for the fact that some of the are rented). Don't think F knows about it. I suppose there is a fighting chance to organise an RTM, but this will take time and I need to dispose of my immediate problem straight away....

any more thoughts? thank you.

[Gordon999]

Lena,

1. I would try to argue that the breech of lease has not done any damage to the property and

2. Study jeffrey's advice given in this thread

http://www.landlordzone.co.uk/forums/showthread.php?t=10855

[Gordon999]

sorry , thread ref correction (started by sbanoir on 22-4-08 )

http://www.landlordzone.co.uk/forums/showthread.php?t=10855

[Poppy]

Read the lease. Please quote any applicable clauses that permit/prohibit letting. Please quote any applicable clauses that permits the freeholder to charge a fee for providing consent/permission/licence.

If it turns out that letting is absolutely prohibited, I hope you have taken note that your freeholder is willing to overlook such a breach. Hopefully the members can help you to negotiate a reduced fee.

If you have a mortgage you need to regularise the matter with them too.

[jeffrey]

As it is an absolute prohibition, s.19 of LTA 1927 does not apply- nor s.158 of (and Schedule 11 to) the 2002 Act.

[Gordon999]

Does the wording in the lease say what penalty applies for a breech of the subletting prohibition ?
How old is the lease ? Start before AST come into use ?

[jeffrey]

Does the wording in the lease say what penalty applies for a breech of the subletting prohibition?
L could simply serve OP under s.146 of LPA 1925 and then proceed to threaten forfeiture.

[lena]

Does the wording in the lease say what penalty applies for a breech of the subletting prohibition ?
How old is the lease ? Start before AST come into use ?

Thanks everyone and Happy New Year.

The lease dates to 1988. It states: "The T will not grant any underlease or sub-tenancy of the whole or any part of the Premises" Nothing about penalties for breeching this covenant.
Jeffrey, I assume OP is order of posession? Surely this can not happen in reality, can it? Are there any grounds I can negotiate the £1000 fee? Surely it will be in F interest if I don't just abandon the flat and what, put metal bars on windows?

[Gordon999]

Do you mean L will not grant........ ?

Where does the word "ABSOLUTE prohibition" appear in the clause ?

My understanding of the clause in the LTA 1927 is that even if lease wording does say " T will not sublet", consent for subletting may not be unreasonably withheld by LL subject to T agreeing to pay a reasonable fee and the legal fees.

If you refuse to paythe amount demanded, will they seek forfeiture ? I am not sure if any Court will grant forfeiture if the L demand is extortionate .

If there are 50 lessees in your block, you need 26 to sign for setting up RTM company. If everybody's lease is down to 78 years, then you really need to start RTM to take over the site asap before going to lease extension of collective buying the freehold.

Get an invitation letter prepared and get on your skates to go round the block and to knock on doors and find 26 supporters to sign up for RTM .

[lena]

No, the Lease says 'The Tenant will not grant any underlease or sub-tenancy...etc,'
There is no word ABSOLUTE[B] PROHIBITION, correct.
Yes it appears to be so that F will seek forfeiture as the solicitor's letter says '[B]Under the circumstances you are in breach of the terms of your Lease and our client requires that you take the necessary steps to remedy the situation immediately. Kindly be advised that our client will be making the necessary application to the LVT upon the expirry of 14 days to enable service of a notice under S.146 of the Law of Property Act 1925 unless this matter is resolved'

[lena]

And of course the F understands perfectly well that if I go through Court to fight forfeiture and argue the extortionate fees I will loose more in legal cost (mine + his). It is a win/win situation for a F. Money for nothing...
My understanding of of clause of LTA 1927 is (actually was) the same, Gordon, but so far two solicitors disagreed with me...

[jeffrey]

Jeffrey, I assume OP is order of possession?
No, "OP" = "Original Poster" = member who started thread = you.

[jeffrey]

Do you mean L will not grant........ ?

Where does the word "ABSOLUTE prohibition" appear in the clause ?

My understanding of the clause in the LTA 1927 is that even if lease wording does say " T will not sublet", consent for subletting may not be unreasonably withheld by LL subject to T agreeing to pay a reasonable fee and the legal fees.
Lena is right. Nothing in s.19 of LTA 1927 applies where the prohibition is unqualified. All that the Act does, in this context, is that a lease's:
a. "not...without L's consent" is changed into
b. "not...without L's consent (such consent not to be unreasonably withheld)".

[steadynerve]

We have acquired a flat for which the lease indicates subletting is not permitted.

We understand the Office Of Fair Trading consider such terms to be unfair. But this has not been tested in the courts.

Does anyone know if we went ahead with granting a tenancy to a friend aware of the situation and informed the freeholder what the possible legal remedies available to the freeholder would be?

Any what the likely costs to either us a long leaseholders or our sub-tenant would be of any legal actions pursued. And the fastiest timescales with which the use of the flat by the tenant could be brought to an end.

[andydd]

We have acquired a flat for which the lease indicates subletting is not permitted.

We understand the Office Of Fair Trading consider such terms to be unfair. But this has not been tested in the courts.

Does anyone know if we went ahead with granting a tenancy to a friend aware of the situation and informed the freeholder what the possible legal remedies available to the freeholder would be?

Any what the likely costs to either us a long leaseholders or our sub-tenant would be of any legal actions pursued. And the fastiest timescales with which the use of the flat by the tenant could be brought to an end.

The landlord could apply to a LVT that you have breached a covenant and that he wishes to serve a S146 Notice to take possession of your property so pretty serious !

The Unfair Terms have been discussed a bit elsewhere in this forum, if this lease was personally negotiated between you and the freeholder then its unlikely you have a chance, but some would say that the Unfair Terms may apply if the lease was already made and was offered to you on a 'take it or leave it' basis.

I think you could apply for a variation in the lease though.

Andy

[sgclacy]

We have acquired a flat for which the lease indicates subletting is not permitted.

We understand the Office Of Fair Trading consider such terms to be unfair. But this has not been tested in the courts.

Does anyone know if we went ahead with granting a tenancy to a friend aware of the situation and informed the freeholder what the possible legal remedies available to the freeholder would be?

Any what the likely costs to either us a long leaseholders or our sub-tenant would be of any legal actions pursued. And the fastiest timescales with which the use of the flat by the tenant could be brought to an end.

It is possible that such a clause was necessary to obtain planning.

[jeffrey]

The lease already exists, and was not newly-granted to OP; its contents cannot be challenged. They were known before OP purchased and bind OP.

[dominic]

Could you not apply to the LVT to vary the terms of the lease?

Their supervision may regulate the fees being demanded for such variation by the LL.

[jeffrey]

Could you not apply to the LVT to vary the terms of the lease?
No, it has no such jurisdiction. That would be a breach of L's property rights too.

[dominic]

According to bullet point 4 on their website:

http://www.rpts.gov.uk/our_services/ld.htm

they would appear to have such jurisdiction (to supervise the variation of leases).

[Lawcruncher]

If the landlord has demanded or accepted rent since he had notice of the breach then the covenant has been waived in respect of this (but not any future) breach.

If the above does not apply it is worth looking carefully at any letters you have received. They may be phrased in such terms as to constitute consent.

[Lawcruncher]

According to bullet point 4 on their website:

http://www.rpts.gov.uk/our_services/ld.htm

they would appear to have such jurisdiction (to supervise the variation of leases).

See here for the grounds on which an application to vary a lease may be made:

http://www.statutelaw.gov.uk/content.aspx?LegType=All+Legislation&title=landlord+and+tenant&Year=1987&searchEnacted=0&extentMatchOnly=0&confersPower=0&blanketAmendment=0&sortAlpha=0&TYPE=QS&PageNumber=1&NavFrom=0&parentActiveTextDocId=1688813&ActiveTextDocId=1688884&filesize=15542

[jeffrey]

According to bullet point 4 on their website:

http://www.rpts.gov.uk/our_services/ld.htm

they would appear to have such jurisdiction (to supervise the variation of leases).
But not every variation demanded by T, of course; were it otherwise, no-one could ever be sure of how a lease might later be varied.