Yet another court ruling has reinforced that consumer protection laws apply to residential leases.
The case – Brusse and Gerabito v Jahani BV – in the European Court of Justice confirms just because a landlord includes a clause in a tenancy agreement does not make the term legal or enforceable.
The judges in the case clearly stated that the landlord is a business and as the tenants are private individuals, a court must investigate any unfair terms in the lease even if the clause is not disputed by either party.
This could lead to a court rejecting a valid application on the grounds that the lease includes unfair terms.
To recap terms in a lease are unfair if:
- A tenants rights under statute or common law are eroded or lost
- The clause does not imply good faith
- The clause imposes an unreasonable charge or penalty
- The tenants right to live in a property are restricted unjustifiably
The landlord is responsible for checking a tenancy agreement to make sure the terms are fair.
The best way to avoid unfair terms is to write a tenancy agreement in plain English, rather than complicated legal jargon.
Simple wording leaves the agreement easier to understand and less open to misinterpretation.
The most common disputes over unfair terms cover the tenant’s use of the property and rent reviews.
Legally, the tenant has a right to ‘quiet enjoyment’. The landlord should not access the home without permission, except in an emergency, and should give at least 24 hours’ notice of visits for inspections or repairs.
Other unfair restrictions include not allowing a tenant access to part of a home or putting limits on time they can spend in the garden.
Rent reviews can also cause friction between tenants and landlords. A landlord cannot raise the rent without the tenant’s agreement – and if the tenant does not agree, the rental agreement ends.
Fair rent rises include putting the amount up in line with inflation, a pre-agreed hike or because an expense, like council tax, has risen.
Information about unfair lease agreements are explained in more detail on the Office of Fair Trading web site.