Taking rent from tenant overlap?

by Readers Question

10:21 AM, 10th December 2018
About 2 years ago

Taking rent from tenant overlap?

Make Text Bigger
Taking rent from tenant overlap?

I had a tenant whose tenancy ends at the end of Nov, who actually left, checked out and handed back keys at the end of Oct, one month earlier.

I then had my letting agent find a new tenant and started her tenancy at mid Nov, two weeks before the previous tenant’s tenancy ends.

Therefore I expect
– the old tenant pays rent upto end of Nov as in the previous tenant’s tenancy agreement
– the new tenant pays rent from mid Nov as in the later new tenant’s tenancy agreement

However my letting agent argue that I can’t take rent from the old tenant, as soon as a new tenancy starts, which I find very odd.

The old tenant is responsible for his/her obligation of paying rent till the end of the tenancy they agreed. They may leave the property earlier, but are obliged for their rent in full. If they did leave early and give back the possession of the property to the landlord, landlord can decide what ever fit to do which has absolutely nothing to do with the previous tenant’s rent etc.

Is there any legal clause that saying the landlord has to refund the rent to the old tenant once a tenant is found? I never agreed or instructed to the letting agent or the previous tenant for a refund etc.

Many thanks

Mike


Share this article

Twitter Facebook LinkedIn

Comments

Mike

22:35 PM, 10th December 2018
About 2 years ago

Reply to the comment left by Mike at 10/12/2018 - 22:34
In our case, the existing tenant is obliged to pay till the end of their tenancy end date, i.e. rent, bills etc. They may decide to leave, vacant, check out, move out early, (I'm listing these verbs, because I believe confirmation of leaving and moving out has legal significants, such as in tenant eviction cases ) , when the tenant confirmed leaving, effectively giving up the rights they have to live in the property(which doesn't change their obligation), and also effectively handing back the possession fo the property back to the landlord.
Therefor the landlord now has regained the possession of the property and should be free to do anything with it.

The existing tenant's obligation and the tenant's future action are two completely separate things. The tenant has to pay the full rent till the end date to fulfil his legal obligations, but what the landlord decides to do with his property after gaining possession shouldn't be in anyway affecting the tenant's obligation. I don't agree that the landlord breaches tenancy agreement if he relet the property, simply because the tenant gives up the right to the landlord.

Compared to the flight and hotel example above, we don't go back to the airline and hotel to ask a share of the profit from them as they managed to sell their seat and hotel room afterwards.

I hope I have explained myself well and many thanks for your thoughts.

Neil Patterson

8:46 AM, 11th December 2018
About 2 years ago

General consensus from P118 landlords is that once the property is re-let then they discharge the old tenant from the responsibility of paying rent as the costs are now covered.

Despite the airline ticket and Hotel analogy this line of argument will not help landlord public perception and will give fuel to the anti-PRS debate regardless of rights or wrongs.

Peter Fredericks

11:03 AM, 11th December 2018
About 2 years ago

Reply to the comment left by Neil Patterson at 10/12/2018 - 10:33
Hi Mike i dont think you can take double rent. However if the tenant breached a forfeiture clause, for example by failing to give notice properly or breaching a covenant not to redecorate, then you might recover the deposit by way of forfeiture. But be careful as your tenancy agreement needs to cover that off.

Regards Peter

Kate Mellor

13:23 PM, 11th December 2018
About 2 years ago

Reply to the comment left by Mike at 10/12/2018 - 22:35
Mike, whilst an AST is technically a contract and contract law does apply, the additional laws applicable to tenancies override these. A specific example applicable in this case being the Common Law principle of ‘Surrender’. If you accept an early surrender by reletting you END the tenancy and the tenant is no longer liable to pay rent.
Here is a quote from ‘A Practical Approach to Landlord & Tenant, Simon Garner & Alexandra Frith.
10.19 ‘Surrender, as the name implies, means giving back to the landlord the remainder of the tenant’s interest. The tenant who surrenders a lease gives up his or her estate in land. Where there were formerly two estates in land there will be, from the date of surrender, only one: the tenant’s interest is absorbed back into the landlord’s larger interest. Once surrender has taken place all obligations and rights under the lease end (although it is possible that the tenant may be liable for breaches of agreement that occurred before the date of surrender).
10.20 The crucial feature of surrender is that it can occur only by mutual agreement….If there is no agreement (although this agreement can be implied) between landlord and tenant there can be no surrender…’
‘Surrender by operation of law
10.22 In some cases the law will imply a surrender. The key factor is that the parties must behave in an unequivocal way which is inconsistent with the continuation of the existing tenancy….’
10.23 ‘…If James leaves the property and Peter re-enters the property and rents it to Simon, the law will imply a surrender. By granting a tenancy to Simon, Peter is acting in a way inconsistent with the continuation of James’s tenancy. It would be inequitable for Peter to claim the tenancy was continuing after he had taken such action. The law will regard the original tenancy as having been surrendered by operation of law (Wallis v Hands [1893]’
10.24 ‘…The fact that a tenant leaves the premises will not constitute an implied surrender if the landlord performs no action that he too regards the tenancy as being at an end (Preston BC v Fairclough (1982)…’

So, as you can see from this passage lifted verbatim from an academic text on landlord and tenant law the key point is that the tenant’s obligation to pay rent to the end of the term is ended once a surrender occurs. Once a landlord relets the property a surrender ‘by operation of law’ has occurred. So, NO, unequivocally you have no right to demand rent from the outgoing tenant for the period from which you relet the property.

Ian Narbeth

15:25 PM, 11th December 2018
About 2 years ago

It is a common law rule that rent to be paid in advance cannot be apportioned on a time basis, regardless of how the tenancy was ended, unless there is clear wording in the tenancy agreement that states otherwise. See this article:
http://england.shelter.org.uk/legal/rents/introduction_to_rents/payment_of_rent#1
Following a surrender the landlord is entitled to re-let and may get a windfall.
Did the tenant agree anything with the agent or did he simply check out and hand back keys at the end of October without agreeing anything? Does the tenancy agreement say anything about apportionment of rent?
The agents might have done you a favour by saying to the tenant: "We agree to accept the surrender on the basis you pay rent up to end November."
Absent anything in the tenancy or any agreement when the keys were handed back I would keep the windfall. If the old tenant found out and protested I would point out that by our accepting the surrender the tenant was released from liability for Council Tax, water, gas and electricity charges etc. If pushed I might offer refund or partial refund to avoid aggravation and (unjustifiedly) bad publicity but on the basis the payment was ex gratia and in full and final settlement.

Kate Mellor

16:30 PM, 11th December 2018
About 2 years ago

I stand corrected. The link Ian has provided is for the Shelter Legal page and whilst all the cases cited were commercial tenancies and not ASTs, the takeaway point seems to be that the Apportionment Act 1870 does not apply to rents paid in advance, stating that they do not accrue day by day. The act only applies to rent paid in arrears. So once rent is due for the month in advance it is due for the totality of the month regardless of the tenancy ending before the end of the period. (except for ASTs after Oct 2015 and ended by S21).
The common law explanation of surrender doesn't stipulate this proviso, and presumably would only be relevant to Mike if the tenant left in month five and he relet at some point in month five, in which case the rent for month 6 would no longer fall due, with rent for the whole of month five still being payable.
As I've ALWAYS apportioned rent paid in advance on a prorate basis for many different reasons (and I'm sure many landlords do likewise) it does strike me as an odd decision. I personally suspect that the commercial nature of these cases had a bearing on the outcome, but that is neither here nor there. I can't see Shelter putting anything detrimental to tenants on their website if it weren't accurate.

Emtee

8:15 AM, 14th October 2020
About A week ago

Reply to the comment left by Kate Mellor at 11/12/2018 - 16:30
Hello, I know this thread is two years old but it is the only thing I have found that exactly talks about my situation. 12 month fixed term - I upped and left with no notice left keys on side, text land lord and ll said no problem but I want you to pay one more month rent. I agreed to pay in weekly installments, paid first week then found out new tenant had moved in so shelter told me to stop paying because the ll had surrendered the tenancy by moving someone new in therefore no more rent was payable. However I also found the paragraph about rent not being apportioned and wondered of it counts in my situation. I was actually thinking ill ask for the keys back then I can use it seen as I'm still paying but then ll re let it so I don't see how it's fair that I should pay 3 more weeks when I can't use it and ll is getting rent from new tenant. Does the apportioned rent paragraph apply to me? Thanks

1 2

Leave Comments

Please Log-In OR Become a member to reply to comments or subscribe to new comment notifications.

Forgotten your password?

OR

BECOME A MEMBER

Welsh temporary lockdown - Is moving home permitted?

The Landlords Union

Become a Member, it's FREE

Our mission is to facilitate the sharing of best practice amongst UK landlords, tenants and letting agents

Learn More