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How to Prevent your Landlord from Forfeiting your Lease - in One Easy Step...
By Christopher J Sherliker

The Leasehold Property (Repairs) Act 1938 (“the Act”), although now mostly forgotten, holds a very useful provision for tenants who are facing possible forfeiture proceedings for breaching a repairing covenant in their lease. Senior Litigation Partner John Abbott explains the significance for tenants of premises.

If a landlord has served a notice under s.146 of the Law of Property Act 1925, then a tenant may serve a counter notice under the 1938 Act.

Once a counter notice is served, no legal proceedings may be taken by the landlord for the enforcement of any right of re-entry or forfeiture under the lease for a breach of a repairing covenant, or for damages, without first obtaining leave of the court.

The tenant must ensure he serves the counter notice within 28 days of the s.146 notice.

The only criteria a tenant needs to satisfy is that there must be three or more years unexpired in the lease.

Where the lease has three years or more to run and the landlord has served an s.146 notice, but the notice fails to draw to the tenant’s attention his rights under the 1938 Act, then the s.146 notice would be deemed void.

If the tenant has served their counter notice, the landlord must obtain leave from the court before enforcing his right to forfeit the lease. The landlord has to prove one or more of the grounds listed in the Act in the same hearing in which he has applied for leave to bring forfeiture proceedings.

Most commonly, landlords seek to establish the circumstances outlined in s 1 (5) (a) of the Act, “that the immediate remedying of the breach in question is requisite for preventing substantial diminution in the value of his reversion, or that the value thereof has been substantially diminished by the breach”.

A landlord must prove the breach and one or more of the grounds in the Act on the balance of probability; it is not sufficient to establish merely a prima facie case. The court has discretion to refuse leave, even if the landlord has made out his ground.

The Act was passed for the purpose of protecting tenants who are facing unscrupulous dilapidations claims by their landlords. It is often overlooked, which is unfortunate, as it is remains applicable to tenants today.

Accordingly, if your landlord serves you with an s.146 notice relating to a breach of a repairing covenant, you should, as a matter of course, serve a counter notice. It is an easy and effective step to take to protect you from forfeiting your lease.

Added: 1st September 2010

Christopher J Sherliker is a partner for Silverman Sherliker LLP who provide legal solutions across a spectrum of requirements.  Find out more about Silverman Sherliker LLP.


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