The proposed Bill seeks to give residential tenants, currently on assured shorthold tenancies, greater protection. Whilst the Bill primarily affects these tenants and their immediate landlords it has an impact on superior leases; which ultimately will affect the rights of Freeholders and Superior Landlords.
Some of the changes introduced by the Bill include:
- There will be no more assured shorthold tenancies;
- There will be no more fixed term tenancies; and
- Landlords will not be able to evict tenants via the s.21 ‘no fault’ procedure.
For a more detailed review of the terms Labour propose to introduce, see our blog here:
These changes mean changes for superior leases and the new legislation will override any clause in a superior lease that requires:
- any subletting to be granted on a fixed term AST so that the intermediate landlord is not in breach of the covenants in the superior lease; or
- the intermediate landlord to deliver up the property free of any such subtenant so that failure to do so will not constitute a breach of the superior lease.
Whilst the above clauses may become redundant, some clauses in superior leases may become more important. One proposal introduced by the Bill is that Landlords must not unreasonably refuse pets at a rental property. In assessing what is ‘reasonable’ in these circumstances, it is likely to be justified for the Landlord to refuse a pet if the superior lease does not allow pets. If you do not want pets to be kept in your buildings, this may be a sensible clause to introduce.
The introduction of a ‘decent homes standard’ and deadlines for landlords to deal with issues such as mould and damp, may have an impact on Superior Landlords if the issues arise from defects or remediation works required to common parts, assuming it is the Superior Landlord with the repairing responsibility. Whilst it’s likely any enforcement action by the Council would be bought against the immediate landlord, it is assumed that the immediate landlord would be putting significant pressure on the Superior Landlord to carry out the works. The upside of this, is that all rental homes should be kept to a ‘decent’ standard; and most Freeholders and Superior Landlords would see this as a benefit.
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