Tenant Rights- Rent Suspension Clause

This is a brief summary of a High Court Decision which was sent to me earlier this week. Although unusual gives some legal interpretation to the Rent Suspension Clause. I am sure it will be contained within the tenancy agreement you use and affects the rights of your tenant.

Tenant Rights Court Case – Baillie (Landlord) V Savage (Tenant) 2018

Facts:

  • 2 Year Fixed Term Tenancy.
  • Approximately £34,000 in rent paid upfront for the full term
  • Landslip caused a garden wall to collapse causing damage to parts of the property. The tenant had previously notified the letting agents of the bulging garden wall on numerous occasions. However, no action was ever taken (unsure what conversation took place between agent and landlord).
  • Tenants instructed their own surveyor who concluded that the property was uninhabitable. This was due to further risk of other parts of the garden wall collapsing.
  • The tenant argued that the rent suspension clause in the tenancy was invoked because the property was unfit for habitation and therefore no rent was payable from the moment possession was handed back
  • The landlord argued that the bulging of the garden wall was present at the start of the tenancy and that a risk of further landslides should not allow the rent suspension clause to be invoked
  • Both the judge at the first hearing and the subsequent appeal, found in the favour of the Tenant. Stating that (a) damage had occurred AND (b) the potential risk of further damage occurring was evident and that this made the property uninhabitable for the purposes of the rent suspension clause.
  • The judge awarded the tenant £18,059 in unused rent and interest. This included a rent reduction of 1/3 for the period of six months which the tenant had remained in occupation after the garden wall collapsed. The Landlord was also made to pay £10,000 to cover the Tenants costs.

What does this mean in reality?

From the description, this appears to be a property located in the countryside. However, what it does highlight is the importance of recording keeping and getting the landlords instruction, conducting a full property inspection before a let is undertaken. It also highlights the importance that you ENSURE all remedial works are completed before the property is occupied.

As you will know, the Fitness for Human Habitation Bill is going to be law at some stage in 2019. This will increase the liability on the landlord to ensure the property is as safe as possible (taking into account HHSRS), before a tenant commences occupation.

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