Landlord and Tenant Law – The Importance of A Written Tenancy Agreement
Does a Tenancy Have to Be in Writing? Under the Law of Property Act 1925 and the Law of Property (Miscellaneous Provision) Act 1989 any contract for the creation of an interest in land is invalid and unenforceable unless it is do so in writing. Interest in land would include mortgages, sales and transfers, charges or leases. The exception to this rule is that an oral lease may be created so long as it is;
* For the best rent reasonably obtainable (i.e. a market rent) * For a period of less than 3 years
This means that a tenancy can generally be created by verbal a agreement, although this isn’t advisable as verbal contracts would be difficult to prove and if the relationship between the landlord and the tenant breaks down, an expensive court proceeding may be have to take place in the absence of clear and unambiguous terms. This is why a written tenancy agreement is therefore in the best interests of both the landlord and the tenant.
Written Statement of Terms At the moment every residential tenancy is presumed to be an Assured Shorthold Tenancy unless there is an agreement that states otherwise. Tenancies of this type are subject to special rules.
When there is no written tenancy agreement, section 20A of the Housing Act 1988 provides that the tenant is entitled to be provided on demand with a written statement setting out the following terms of the tenancy:
* Term or length of the tenancy
* Date on which the tenancy commenced
* Dates on which rent is payable
* The rent due under the tenancy
The landlord is required by law to provide this statement within 28 days of receiving written notice from the tenant. Any failure to comply with the requirements of this act wil be classed as a criminal offence and if a landlord fails provide the requested statement within 28 days, they may be convicted and fined up to 2,500.
What Should I Put In The Tenancy Agreement? The information on dates and rent payments that landlords are obliged to provide the tenant under the Housing Act, a tenancy agreement will usually include provisions which relate to the following:
* Details of additional bills & service charges
* Procedure for ending the tenancy and resolving disputes
* Procedure for varying the rent
* Responsibility for maintenance
* Restrictions on the use of the property
In all tenancies, the tenant will have a number of basic rights which cannot be taken away or restricted, and any provision of the tenancy agreement which attempts to do so will become invalid. Where one provision or term of a contract such as a tenancy is found to be invalid, other provisions which refer or relate to that term may be unenforceable. Because of this, care should be taken when drafting a tenancy agreement and you may want to consult a professional.
If you own several properties which you rent out, it may be more cost-effective for you to ask a lawyer to draft you a standard-form tenancy agreement which you can customise for each individual property rather than consulting a solicitor for each individual tenancy.