Lease Disputes – Breach of Covenant

Lease Disputes – Breach of Covenant

A lease usually contains express covenants, or agreements, between the parties. For example, a lease agreement may require the tenant to keep some parts of the property in good repair, and the landlord may have repairing obligations over another part. Certain covenants may also be implied into the lease by statute or common law.

Damages

If a covenant is breached, a landlord can bring damages for the devaluation the breach has caused to their reversion (ie the value of the property once the lease ends and it passes back to the landlord), and a tenant can bring damages for the difference between the value of the lease with the covenant performed, and its value now it has not been performed. Damages can also be claimed for inconvenience, stress and damaged items caused by the breach, and the parties can seek that the covenant in question be performed, or that a party be forced to stop a certain action that is causing damage.

Possession/Forfeiture

A landlord’s claim for damages will often also include a claim for possession of the premises, either to enforce a right of forfeiture of the lease or because the term of the lease has expired. Where the matter involves a tenancy of 7 or more years, and 3 or more of those years remain unexpired, the landlord cannot progress a claim for possession unless they serve on the tenant a s146 Notice (under the Law of Property Act 1925). This notice must set out:-

  • Details of the breach;
  • If the breach can be remedied, a request for this to be done;
  • A request for compensation in respect of the breach; and
  • Inform the tenant that he is entitled to claim the benefit of the Leasehold Property (Repairs) Act 1938, which means that within 28 days he can reply stating that the landlord must obtain Court permission to proceed with the action for possession.

However, before a s146 Notice can be deemed valid and proceedings for possession can be commenced, either the tenant has to admit the breach, or a determination by a Court or the First Tier Tribunal (Property Chamber) will be required that the breach has occurred.

Restriction of Forfeiture for Breach of Covenant

Even once the above required are complied with, the landlord cannot seek forfeiture of the lease unless the tenant has failed within a reasonable time to remedy the breach or make reasonable compensation for the breach.

Defences to a Claim for Possession

If the landlord has made a demand for rent after being aware of a breach, the landlord is no longer entitled to seek forfeiture. Similarly, if a tenant offers rent, the landlord must reject it so as not to waive their right to claim there has been a breach of the lease.

If a landlord is proceeding against a tenant for possession of the property, and the tenant does not agree to the action, the tenant may apply to the court for relief. Sub tenants and those with a mortgage over the property are entitled to seek relief in the same way.

The threat to determine, or bring about an end to the lease due to breach of covenant can be a powerful tool in seeking a remedy to a breach. However, as can be seen there are several hurdles for landlords to overcome before being able to actually terminate a lease and take possession of a residential property. Should you be under threat of such proceedings or if you are seeking action against a tenant, legal advice should be sought to ensure you comply with the sometimes complex requirements of these actions.


Gareth specialises in Civil Litigation and Dispute Resolution, and can assist where such problems have arisen. He can be contacted at gpb@beechamfisher.co.uk or on 01702 348 384.

To minimise the risk of such problems arising, Frances White can offer assistance to landlords and tenants in the negotiation of their leases. She can be contacted at fw@beechamfisher.co.uk or on 01702 348 384.

Nothing in this publication should be regarded by any person as advice or in the nature of advice: it should not be relied on; and the author assumes no liability whatsoever to any person.

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Kathryn Pavitt

Paralegal

Kathryn is an affiliate member of the Chartered Institute of Legal Executives and is a qualified Residential Conveyancing Paralegal. Since joining the firm in 2009 as a secretary, she has attained these qualifications whilst providing support to the Conveyancing and Probate departments, with the ultimate aim of qualifying as a Chartered Legal Executive.

Kathryn is a mother to a young child and in her spare time she enjoys cooking and spending time with friends and family.

Val Nunn

Legal Assistant

Val has more than 30 years’ experience working in legal departments, with 25 spent as secretary then PA to Margaret Ridley.

More recently, Val has run her own body of matrimonial cases and following Margaret’s retirement as a partner, continues in this role and also as PA to Peter Fisher and Debbie Stanton.

She has extensive experience of dealing with all aspects of family matters and of assisting with high value and complex financial issues.

As well as her work, Val enjoys spending time with her family, football as a supporter of both Arsenal and Southend United, reading, entertaining and dining out.

Gareth Brazier LLB (Hons)

Associate Solicitor

Gareth qualified as a Solicitor in 2012 and has many years of civil litigation experience, having previously worked in the City of London advising major insurers on a range of issues including road traffic accidents, industrial accidents and the defence of fraudulent claims. He has experience of handling serious and complex injury matters including spinal, traumatic brain injury and amputations.

More recently Gareth has transferred these skills into providing a detailed and thorough service for both private clients and small businesses in property, contract and debt recovery disputes. Where agreement or mediation is not possible, his robust approach to litigation can secure the right outcome.

Gareth has three young children, and when not enjoying time with family he spends time on outdoor pursuits such as running, hiking and clay pigeon shooting.

Peter Fisher FRSA

Solicitor / Consultant

Peter qualified as a solicitor in 1969 and had been with the firm throughout his professional life, becoming a partner in 1971 and senior partner in 1994. Peter retired from Partnership in 2015 to become a consultant, and is pleased to take on new work and still has a significant caseload.

Peter’s speciality is family law and he is a member of Resolution (The Solicitors’ Family Law Association). He is very experienced in dealing with complex matrimonial cases, whether these involve structuring financial settlements or handling sensitive child issues. A number of his cases have been published in law reports, including a case which has stood the test of time as the benchmark for unreasonable behaviour as a ground for divorce.

Besides sitting for a number of years as a Deputy District Judge, Peter is also experienced in the preparation of wills and lasting Powers of Attorney.

Peter and his wife have three adult children and four grandchildren. For more than twenty five years Peter was a governor of Thorpe Hall School, a local independent school. A life-long Anglican, he has been much involved with the affairs of the Church of England and is a churchwarden of the Church of St. Margaret of Antioch, Leigh on Sea. He is a Fellow of the Royal Society of Arts and a keen photographer. He enjoys walking in the UK and abroad, and aged over 65 years he completed the Yorkshire Three Peaks in a very respectable time. He has also devised and walked a coast to coast from Harwich to the Bristol Channel and an up-England trek from the English Channel to Lake Windermere.

Frances White LLB (Hons)

Partner / Solicitor

Frances qualified as a solicitor in 1978, having trained with the firm’s founder and former senior partner, Mervyn Beecham. She became a partner in 1979 and has worked with the practice ever since.

A member of Avenue Baptist Church for over 45 years, Frances continues to undertake legal work for various local churches and the community. She was previously a member of the management committee which established the YMCA hostel in Southend.

Frances has a Bachelor of Laws Degree, with upper second class honours, from the University of Newcastle. She was also awarded honours on passing her final solicitor’s examinations with four distinctions.

She is a member of The Society of Trust and Estate Practitioners (STEP) and The Chartered Institute of Taxation (CIOT). Also the Law Society’s Property Section and Private Client Section, which are representative associations for members.

Frances enjoys gardening, baking, the theatre and many types of music. She has no children but has recently become a great aunt three times over!

Debbie Stanton LLB (Hons)

Partner / Solicitor

Debbie qualified as a solicitor in 2004 since when she has specialised in Family Law with a particular interest in resolving financial aspects within divorce/co-habitation/ civil partnerships and disputes involving children. Debbie joined the firm in May 2010 and was brought into Partnership in November 2011.

As a member of Resolution, Debbie is committed to providing a personal, non-confrontational and supportive service.

Debbie’s outside interests include interior design, gardening, reading and socialising with family and friends.

Since January 2016 Debbie has been a trustee for HARP, an established charity which is committed to eradicating homelessness in Southend. As part of her role as Trustee, Debbie attends regular monthly meetings which deal with the general day to day running of the charity.