common law tenancy eviction

[DBSV8]

This property is up for sale , but the tenants are refusing to let buyers view the property and only paying £250 a year !!

https://www.dailymail.co.uk/news/article-11535623/...

note this comes under common law tenancy ,

how easy would it be to evict the tenants

[Electro1980]

Seems rather like the Mail are misrepresenting the situation. From reading the article it looks like the property is held by a company that they are major (majority?) shareholders in, and are paying a peppercorn rent to that company.

This looks like someone is chasing them/the company for debts and they are trying to avoid them. I would guess the reality is they are the owners but the house has been purchased by a company for some tax or legal reasons. However, this is the risk when you try that kind of thing.

The receiver won’t be able to get them out, but the buyer will quite quickly.

Edited by Electro1980 on Wednesday 14th December 16:45

[PhilboSE]

Electro1980 said:

Seems rather like the Mail are misrepresenting the situation. From reading the article it looks like the property is held by a company that they are major (majority?) shareholders in, and are paying a peppercorn rent to that company.

The property was purchased by a “friend” who set up a holding company to do so. The 2 tenants were set up as directors but resigned as such on completion day. The purchaser is now being pursued for £1m he owes to HMRC and £700k he owes to a bank, hence the foreclosure. Apparently the purchaser claims to be worth “millions”.

A Notice To Quit was served on the tenants in August. I don’t know what that means legally for any future purchaser in terms of regaining possession. Either way the tenants seem very belligerent and I would expect a very long drawn out process to move them in, with consequential damage to the property. They just seem like those sorts of people.

The house was previously for sale for £6.5m, be interesting to see what it goes for with bidding sight unseen.

[OutInTheShed]

It's muddy, with dubious company/director frolics.

my guess is, either someone buys it at auction and sends in psycho bailiffs or someone buys it at auction, then pursues the tenants for director responsibility over the company when the tenancy was created.

Or just buy it , sit back, and wait for the revenue to give them a kicking, then take possession when the peppercorn rent cheque bounces.

[Panamax]

If it's an old Statutory Tenancy then there's no easy way out.

The only realistic way forward is to offer to provide "suitable alternative accommodation" and then force that through the courts. Expensive and time consuming.

[CraigyMc]

OutInTheShed said:

It's muddy, with dubious company/director frolics.

my guess is, either someone buys it at auction and sends in psycho bailiffs or someone buys it at auction, then pursues the tenants for director responsibility over the company when the tenancy was created.

Or just buy it , sit back, and wait for the revenue to give them a kicking, then take possession when the peppercorn rent cheque bounces.

I have nothing to add beyond "psycho bailiffs" would be a popular daytime TV show

[bill swizz]

Panamax said:

If it's an old Statutory Tenancy then there's no easy way out.

The only realistic way forward is to offer to provide "suitable alternative accommodation" and then force that through the courts. Expensive and time consuming.

Not being an expert on this, can you explain what makes an "old Statutory Tenancy" more difficult and as the current owner has only owned the house since 2019 does this make a difference?

[PhilboSE]

It’s a Common Law tenancy which (having done some reading) basically seems to be a tenancy arrangement outside of any recognised statutory legislation. If there is no fixed time period then the tenant can be served a Notice To Quit and then 4 weeks later should have left the property. If not, then the landlord needs to go through the courts to force an eviction. It seems that these tenants will be as obstructive as possible in this process.

[OutInTheShed]

Presumably the peppercorn rent tenancy would be a taxable benefit as officers of the company?

That could be a very big tax and NI bill....

ISTR that some tenants can be got rid of if the landlord has no other home himself?

I guess this tenancy being 'common law' is neither a new-fangled Assured Shorthold nor covered by the 'Landlord and Tenant Act' of yore, which is where renewable tenancies (usually for business premises these days) come from?

[Panamax]

bill swizz said:

Not being an expert on this, can you explain what makes an "old Statutory Tenancy" more difficult and as the current owner has only owned the house since 2019 does this make a difference?

"Ownership" of the freehold is irrelevant. The tenant has rights against their landlord whoever that may be from time to time.

Basically, a protected or statutory tenant is someone who's lived there since before 1988. In other words, they had rock solid security of tenure before the more recent legislation (1988 Housing Act) reduced the rights of tenants under future tenancies.

As well as security of tenure a protected or statutory tenant also has the right to a "fair rent", which in this day and age translates as a "very low rent".

Broadly speaking, to move such a tenant the landlord must buy or rent somewhere else for the tenant to live that's comparable accommodation. It's pretty much inevitable this will cost the landlord a serious wedge because the rent the tenant pays doesn't change and will fall far short of the landlord's own outgoings.

[Panamax]

OutInTheShed said:

ISTR that some tenants can be got rid of if the landlord has no other home himself?

It can be one of the reasons for regaining possession IF the landlord has previously lived there himself. Otherwise subject to the court's discretion (see below).

To remove such a tenant the landlord needs to either reach agreement with the tenant or go to court and prove a legal reason for eviction. There are limited mandatory reasons such as clergymen, agricultural workers, military workers or landlord wanting to retire to the property.

Otherwise the discretionary reasons are,

• suitable alternative accommodation is available for the tenant with similarly protected rights
• rent arrears
• breach of tenancy agreement
• antisocial behaviour
• tenant has damaged the property or any furniture that was provided
• tenant has sublet the whole property without landlord’s consent
• tenant was an employee of the landlord and the accommodation is needed for a new worker
• landlord or a member of landlord’s family needs the property to live in. Landlord can’t use this ground if tenant was there before he bought it

[MustangGT]

Panamax said:

"Ownership" of the freehold is irrelevant. The tenant has rights against their landlord whoever that may be from time to time.

Basically, a protected or statutory tenant is someone who's lived there since before 1988. In other words, they had rock solid security of tenure before the more recent legislation (1988 Housing Act) reduced the rights of tenants under future tenancies.

As well as security of tenure a protected or statutory tenant also has the right to a "fair rent", which in this day and age translates as a "very low rent".

Broadly speaking, to move such a tenant the landlord must buy or rent somewhere else for the tenant to live that's comparable accommodation. It's pretty much inevitable this will cost the landlord a serious wedge because the rent the tenant pays doesn't change and will fall far short of the landlord's own outgoings.

All very interesting and informative, however, these tenants only moved in in 2019.

[gt_12345]

What a joke.

You should be able to throw someone out with say N weeks notice. No questions asks.

Going to court isnt fun

[trashbat]

MustangGT said:

All very interesting and informative, however, these tenants only moved in in 2019.

Are you sure? The house was sold in 2019 but houses can be sold with sitting tenants.

Edit: ah, my mistake, looks like on a re-read you're right

Edited by trashbat on Thursday 15th December 18:05

[markjmd]

trashbat said:

MustangGT said:

All very interesting and informative, however, these tenants only moved in in 2019.

Are you sure? The house was sold in 2019 but houses can be sold with sitting tenants.

They moved in when they bought the house.

[PhilboSE]

markjmd said:

They moved in when they bought the house.

They didn’t buy the house.

[DBSV8]

markjmd said:

trashbat said:

MustangGT said:

All very interesting and informative, however, these tenants only moved in in 2019.

Are you sure? The house was sold in 2019 but houses can be sold with sitting tenants.

They moved in when they bought the house.

but they didn't contribute to the purchase , they asked a friend to purchase ., So the friend got a loan of around 2.9 million and set up the purchase in the name of a company .....Hence the Common law agreement

The current tenants were down as executives of this company , after purchase as executives they effectively agreed to pay rent to live in the property for £250 a year....

They then resigned as executives and for the last 3 years been leaving effectively rent free

They are arguing that they invested a lot of money to maintain the property ..... Now the purchaser who is in debt has to raise funds as the bank has called in the loan

would have thought as soon as they resigned from the company they lost all legalities , Cant see how they would be named on the land registry docs if they never contributed to the purchase

[DBSV8]

House sold at auction for over 3 million

So guessing nothing will hapen until exchange of contracts , Then the tenants can be evicted

https://www.theguardian.com/business/2022/dec/15/e...

Edited by DBSV8 on Saturday 17th December 14:30