Are late payment fees for rolling/expired tenancy still chargable?

by Readers Question

7:33 AM, 28th January 2015
About 4 years ago

Are late payment fees for rolling/expired tenancy still chargable?

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Are late payment fees for rolling/expired tenancy still chargable?

Are late payment charges as stated within an AST still applicable once an AST has expired and the tenant is still in situ and not paying rent/paying late..?

Probably not worth seeking formal legal advise for such a small amount that I’m concerned with so I’d thought I’d see if anyone here had any pointers..

Here’s my conundrum..Current tenant on a 12month AST went into arrears at month 11, section 21 served and eventually tenant left at month 13.5, two months after the AST had expired and with 3.5 months worth of arrears. Deposit was offset against arrears and I’m pursuing the balance via the SCC and want to get my maths correct.

The original AST states that I can claim £35 for each late/missed payment and interest there upon. So in total there are 4 payments that were missed/late, 2 within the 12monthAST and 2 once it had expired.

However the tenant has consulted with the local council who have advised that as the tenancy has expired then any late payment fee’s etc outside of the AST period are not chargeable. Kind of makes sense I suppose but I’m no expert and I don’t want to look silly if it goes before a court.

Incidentally, I wouldn’t usually charge late payment fee’s, I usually advise that if we can come to a payment agreement/plan then I would wave them, but this particular tenant has repeatedly given me the run around etc etc you know the usual guff.

Anyway I would be interested in your feedback ladies and gents.
Regards Johnlate



Comments

Joe Bloggs

11:33 AM, 28th January 2015
About 4 years ago

IMO the terms of the contract are implied into any SPT or hold-over unless there is express evidence of an agreement to the contrary.

Michael Barnes

12:21 PM, 28th January 2015
About 4 years ago

Housing Act 1988 Section 5 paragraph (3)(e) suggests that the council is wrong.

I know of no later legislation that changes this.

All BankersAreBarstewards Smith

12:44 PM, 28th January 2015
About 4 years ago

What do councils know about Landlord and tenant legislation ? ~diddly squat that's what they know....

A tenancy does not end just because the fixe term has ended - go for it

Romain Garcin

14:58 PM, 28th January 2015
About 4 years ago

Hi,

The terms of the statutory periodic AST are the same as those of the preceding fixed term AST, as per statute quoted by Michael.
Thus the clause regarding late payment still applies. Whether a court would deem it an unfair penalty clause is another issue and you will find out if you proceed to SCC.

George Crofts LLB

16:25 PM, 28th January 2015
About 4 years ago

Hi John

As everyone has said, terms of the SPT are the same as the AST.

Echoing somewhat Romains response, I would also be wary of the penalty clause/liquidated damages clause issue.

Although the Office of Fair Trading is now closed, with its responsibilities being passing to a number of different organisations, their guidance notes on this area are still instructive. Have a look here:

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/284440/oft356.pdf

I think the most relevant examples of potentially unfair terms in regard to your situation are contained at page 81 (fees for late payment). As you will see, they suggest that these kinds of fees could be unfair and suggest rewording the clause to contain a 'reasonable' test.

JohnCaversham

22:07 PM, 28th January 2015
About 4 years ago

Many thanks to all for taking the time to give thoughtful advise and helpful pointers and in particular the links ....

I'll include all the late payment/interest fee's in my SCC claim as the AST does indeed allow me to, i'll then let the courts make a decision on whether or not i can have them.

Best rgds, John


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