Monday, May 21, 2012

Subletting Covenants Are There For A Reason!

Quit Claim Deed Form - Subletting Covenants Are There For A Reason!
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We inherited a whole of landlords who ignored the subletting covenants because there was no freeholder/managing agent at the time they purchased. Even though they are now fully aware of the management/owner structure they continue to ignore our requests to gain permission retrospectively, leaving them in breach of their lease. This includes the slum landlord with an anti-social and alcoholic tenant in situ, who has just been fined £8,000 for renting out one of the worst homes that our neighbouring council of Newham has ever seen! He has resisted all attempts we have made to get him to deal with his tenant who is now without any electricity and therefore no heating. Whilst he was the author of his own misfortune by hot-wiring the meter, his landlord is still happy to be paid housing benefit.

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Local Authority Involvement

We also have local authority involvement in the form of hidden Sector Leasing where landlords who don't have permission to sublet hand over their properties to the council who don't check they have permission to sublet either. We then find out that more than one authority can be involved in our block at any one time because they have reciprocal arrangements with each other when one of them runs out of accommodation!

Dangerous Situations

Because the covenants to sublet are still being ignored, we are getting landlords who, quite frankly, is what landlord licencing would go some way to dealing with. We've had a family re-housed by the local council as an crisis because of the state the landlord and his letting agent had allowed the flat to get into. This landlord also owned a whole of other flats on the block which were 'managed' to a similiar standard.

We have an additional one who conception nothing of placing a young mum with two small children into one of his flats that had a faulty gas meter. On smelling gas the first night she moved in, she called a gas firm and was told that had she switched on a light there would have been an explosion! Even using a mobile could have had the same outcome and the engineer was so horrified that the landlord ended up in problem with the gas company.

We have continually asked for proof that the flat is now safe but no such facts has been forthcoming, and our requests are ignored. Our managing agent has said that if we want to push it supplementary we need to consult a solicitor!

What Can We Do?

Conditions

A freeholder can make conditions ahead of granting permission to sublet but even so, these are not without risk, in general to us. Such conditions have to be enforceable and, under statute, reasonable. For example, requiring a deed of compact that requires the tenant to abide by the conditions contained within the lease may not be too much of a problem. However, requiring a large security deposit from the sub-tenant in case they don't keep to those conditions would be considerably harder to justify, if at all.If a letting is lost or prevented because deal cannot be reached, landlords could make a claim for damages against us because they are entitled to protect their legitimate interests.

Inspect and recognize Hazards

As we weren't getting anywhere regarding the aforementioned landlords, I decided to try an additional one route and asked my local council to peruse and recognize hazards in their flats under the Housing Act 2004 (specifically Hhsrs). They have attended one of them so I am waiting to hear their findings.

Industry Professionals

I also contacted the relationship of Residential Letting Agents, the relationship of Residential Managing Agents, the Housing minister Grant Shapps and the condition and security menagerial outlining my concerns about the subletting covenants being ignored and asset and tenants subsequently being put at risk. The only reply came from the National Federation of asset Professionals but all they did was refer me to the Leasehold Advisory Service.This was very disappointing because at the very least I was looking for a annotation on something that is not just a block supervision issue but a conveyancing and Prs issue too.

Forfeiture

The extreme sanction of a freeholder is to go for forfeiture of the lease. This is often sought in cases of non-payment of assistance charges and involves applying to the Lvt for a determination that the terms of the lease have been breached. If we tried to pursue it in the case of our slum landlord with the anti-social and alcoholic tenant, written/photographic evidence would be required, as well as witnesses that would be ready to furnish statements of sightings/nuisance being caused etc.

However, here's our problem. The solicitor who in case,granted that advice was charging £400 + vat to carry out an introductory review, setting out all the options and dealing with the introductory letter that would state that forfeiture would be carried out if the situation was not resolved. All supplementary work undertaken would be charged at an hourly rate of £185 p/h + vat and disbursements which would have to initially come out of the assistance charges!

Summary

We haven't had a single approach from whatever requesting permission to sublet so we don't even get the opportunity to lay down some conditions. Whilst I don't see a qoute with the type of conditions we would like to place, the type of landlords we get on this block cannot be reasoned with so how are we, as freehold owners, supposed to protect our legitimate interests when we are virtually hamstrung in the first place?

I've yet to find whatever who can furnish me with a definitive answer!

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