Landlord and Tenant Act 1954

Anyone thinking about investing in Commercial Property needs to have a good understanding of the Landlord and Tenant Act 1954.

Part 2 of the Act gives tenants occupying for business purposes a right to renew their lease on similar terms to the existing one. It applies where:

  • There is a tenancy as opposed to a licence
  • Where the tenant is in occupation for the purpose of business and
  • Where the tenancy is not specifically excluded from the 1954 Act

Our resident Property Litigation expert Rita Wright says “It is extremely important that Landlords take advice before entering into any business lease with their tenants. If a Landlord were to terminate a lease wrongly which is protected by the Act they are likely to face a Court Injunction and a claim for damages”

Apart from a lease being specifically excluded from the Act, the Act won’t apply if the term granted is less than 6 months and the tenant’s total occupation does not exceed 12 months (unless of course the lease provides for an extension of the term).

If a Landlord wants to terminate a lease which has protection of the 1954 Act, there is a procedure that must be followed. The Landlord must serve a notice and prove one of the statutory grounds under the Act.

The notice must be served within very strict time limits and it is important that it is drafted correctly. Some of the most common grounds used are reconstruction and substantial works or the Landlord’s desire to use the premises himself.

If a notice is served and is not a valid notice or served incorrectly this may substantially delay the Landlord from regaining possession of the property.

For advice and assistance in this particularly tricky area of law please contact Rita Wright or the Commercial Property Team at Breeze and Wyles Solicitors Ltd on 01992 558411

Web site content note: 

This is not legal advice; it is intended to provide information of general interest about current legal issues.


One bad apple can spoil the whole Portfolio

Do you have a property or block which is letting the rest of your portfolio down?

Are you encountering ongoing and unresolved disputes that are proving difficult to resolve?

Most estate or property managers will likely have at least one property or estate within their portfolio that has issues that are difficult to resolve and may require work that goes over and above the normal property management services provided. It might be one particularly difficult resident or tenant, or there may be substantial service charge or rent arrears which are preventing the estate or property to be properly managed.

Good property managers these days are also very concerned about how they stand reputationally with their leaseholders, occupants, tenants and landlords for whom they manage properties for. With the ease of the internet it is easy for a reputation of a property management company to take a downward turn if one property hits the right website or media with complaints or comments from unhappy occupants. It might be an estate set-up or accounts issue, or an issue more general like poor developer build or conversion. Even repeated changes of property manager can cause inconsistency and the level of service provided can diminish.

We recommend seeking legal advice as soon as possible to try to resolve complex property or estate issues, and try to prevent cases from escalating to legal or Tribunal proceedings. If a legal claim or Tribunal matter has already been raised, however, we can also assist with these and seek to resolve the matter.

If you are experiencing issues with such properties within your portfolio please get in touch on 01992 558411. Our highly experienced expert lawyers and legal staff can provide you with the advice and assistance you require to suit your property management and legal needs.

Janina Lamb is a litigation solicitor at Breeze and Wyles Ltd specialising in general litigation, property disputes, and debt recovery, and can deal with a wide range of issues including landlord and tenant, estate and leasehold management issues including residential property tribunal cases, service charge disputes, and general debt recovery.


Autumn Statement 2016: Letting Agents banned from charging administration fees

In today's Autumn Statement Chancellor Philip Hammond announced that Letting Agents can no longer charge tenants for their admin fees and that responsibility must fall to the Landlords

The Chancellor said: "We've seen these fees rise, despite our attempts to regulate them. Landlords appoint the agents, so landlords should pay for them and this will be done as soon as possible."

Administration fees are estimated to affect over 4.3 million households.

Rita Wright Property Litigator at Breeze & Wyles Solicitors Limited said: "Property Agents supporting Landlords and Tenants in the rented private sector will have to pass all of the cost onto their Landlords. As a result Landlords will be forced to seek to recover these costs through increased rents. While this is a reasonable clarification of the burden of the expenses the net result is that rents will increase in a market where rents are already at a historic high. More tenants will find rents un-affordable creating a higher percentage of default at a time when Landlords are already being squeezed by the governments previous changes."

For help and assistance in any property related issue please contact Rita Wright on 01992 558411 or email Rita.Wright@BreezeandWyles.co.uk


Hide and Seek

hide-and-seek

The Court of Appeal of England and Wales has last month ruled that the ongoing obligation of full and frank financial disclosure relating to financial matters in divorce or dissolution of a civil partnership continues to apply even following the death of one of the parties.

There are strict rules which apply to financial matters related to divorce or dissolution of a civil partnership, which obliges each party to be honest and open about the true extent of their financial positions when trying to reach an agreement. If it is later found that one party has failed to disclose assets, or has been dishonest about their financial position, any agreement reached between the parties or Court Order made can be overturned.

The case, Roocroft v Ball [2016] EWCA Civ 1009, involved the civil partnership of Helen Roocroft and Carole Ainscow. The parties dissolved their civil partnership in 2009 and an agreement was reached in respect of the finances. Ms Ainscrow later died 3 years later and it then emerged that she had misled the Court as to the true extent of her financial position, claiming to have lost large amounts of her assets in the 2008 property market crash. Ms Roocroft then sought to reopen financial matters against Ms Ainscrow’s estate in an attempt to overturn the original agreement reached. The lower Courts refused to allow Ms Roocroft’s appeal, claiming that any non disclosure would need to be material to warrant overturning the original agreement reached. However, this was before the landmark decisions of the Supreme Court in Sharland and Gohil in which the Court found in favour of the wives in those cases who had been deceived by their husbands.

Ms Roocroft launched an appeal and the Court of Appeal found in her favour, reiterating the continuing duty of full and frank financial disclosure. Ms Roocroft is now able to take her case back to the Family Court to renegotiate the financial settlement with Ms Ainscrow’s personal representatives.

Here at Breeze and Wyles Ltd we offer expert advice on all matters relating to divorce and financial settlements as well as separation following the breakdown of a relationship.

Lisa Honey is a family solicitor at Breeze and Wyles Ltd specialising in family law and deals with matters covering a range of issues including divorce and financial settlements, separation following the breakdown of a relationship, children matters and declarations of trust. Lisa is also an honorary solicitor providing advice at the Citizens Advice Bureau in Cheshunt and Ware.

For more information on how we can help you please do not hesitate to call our team on 01992 558411 or alternatively complete our online enquiry form.


Director Disqualification

DIRECTOR DISQUALIFIED FOR A FAILURE OF HIS COMPANY TO PAY ITS TAX LIABILITIES (BUT THERE IS MORE)

In a recent press release the Insolvency Service (the ‘IS’) (see: https://www.gov.uk/government/news/tax-dodging-it-director-disqualified) confirm that a Mr Anthony Hodges (‘Mr Hodges’) of Basingstoke signed a director disqualification undertaking preventing him from acting as a company director for a period of 8 years.

That was in respect of misconduct found in the company Hodges & Coley Ltd (the ‘Company’) (see: https://beta.companieshouse.gov.uk/company/07334254) that was placed into creditors voluntary liquidation on 27 January 2014.

Date Action
03 August 2010 Company incorporated.
From January 2011 to January 2014 The IS found that Mr Hodges had failed to ensure that the Company paid its tax liabilities.
27 January 2014
  • Date of liquidation;
  • HMRC owed £191,136;  and
  • Total deficiency to creditors £223,424.

As the above happened the IS found that the sum of at least £423,024 had been paid to Mr Hodges and his family.

It did not end there though because it was further found that Mr Hodges told his accountant on or after 23 October 2013 that he intended to liquidate the Company. However, in spite of that stated intention Mr Hodges was found by the IS to have paid his family and himself £41,471 between 23 October 2013 and 10 January 2014.

It is reported by the IS that it was not disputed by Mr Hodges that in his capacity as sole director the remuneration paid to his family and Mr Hodges was excessive in that:

‘... they represented the majority of (the Company’s) trading income and deprived it of funds to cover its current liabilities, notably (the Company’s) liabilities to H M Revenue & Customs...

The Head of Insolvent Investigations North Mr Robert Clarke at the IS is reported to have commented:

‘Company directors have a duty to ensure businesses meet their legal obligations, including paying taxes and must not benefit themselves at the expense of creditors. Neglect of tax affairs is not a victimless action as it deprives the taxpayer of the funds needed to operate public services.’

 COMMENT

 This case is unusual in that it is the first director disqualification that I have seen where it was found that the director of the company took remuneration and benefits that were excessive. In my experience this is usually a difficult allegation to bring because it is difficult to prove. For example, what can the remuneration taken be compared to, to show that it was excessive.

In my experience this fact is probably what moved the case from the fairly usual failure to pay HMRC allegation in the lower disqualification bracket (2 to 5 years) to being more serious with the consequent increase in the period of director disqualification for Mr Hodges.

FURTHER RISK

The Joint Liquidators of the Company may bring an action for Misfeasance against Mr Hodge personally (and possibly members of his family) pursuant to section 212 of the Insolvency Act 1986 (see: http://www.legislation.gov.uk/ukpga/1986/45/section/212) to recover some or all of the remuneration paid and / or the loss to HMRC and other creditors of the Company.

A Misfeasance claim brought by a Liquidator typically alleges that the Company has paid monies out (to the director, their family members / friends or a connected company perhaps) that cannot be cross referenced in the books and records of the Company. It is then alleged as a consequence that the director has misapplied, retained, or become accountable for those monies in breach of that director’s fiduciary or other duties in relation to the Company. That is the director has to pay for the alleged loss personally.

WHAT TO DO NOW?

If you are faced with a claim for director disqualification by the IS or a Liquidator has sent you a letter before claim alleging Misfeasance please talk to me today. That is in order to protect your position without delay. The earlier that you speak with me the more that I can help. Why not call me today on 01992 558 411 and speak to me without obligation, pressure or cost. You can also email me at Richard.cole@breezeandwyles.co.uk

If you are happy to instruct me, my firm and I are happy to talk to you about fixed fees or staged fees that are agreed with you in advance of any work being carried out. Your work will be carried out by me or others under my close supervision. Finally, I am happy to come to you to take instructions.

Until next time,

THE DIRECTOR’S FRIEND

workplace-web


For Richer, For Poorer, Till Death Do You Part?

untitled

Trinny Woodall is facing a fresh legal battle in relation to the estate of her ex husband Johnny Elichaoff. The couple married in 1999 and had a child together but later divorced in 2009 whilst remaining on reportedly good terms.

Johnny Elichaoff died in 2014 after falling from a car park roof. An Inquest in 2015 heard that he had battled an addiction to painkillers for 20 years and had taken his own life after ‘losing everything’ in a series of failed investments.

As part of the divorce proceedings, the couple reached an agreement in relation to the financial aspects of the separation which included provision for Mr Elichaoff to pay maintenance of £24,000 per annum and to repay £1.4 million that Ms Woodall had lent to him. However, despite this agreement, Ms Woodall did not actually receive anything.

Following the making of that order, it later emerged that Mr Elichaoff had been declared bankrupt prior to the agreement having been reached. Neither Ms Woodall, nor the judge approving the order had been made aware of this.

When a person is bankrupt, their property immediately transfers to their Trustee in Bankruptcy. This meant that Mr Elichaoff was unable to agree a settlement with regards to the finances and the court was unable to approve any order without the agreement of the Trustee in Bankruptcy. This meant that the order was void and this was confirmed earlier this year.

Mr Elichaoff died owing hundreds of thousands of pounds to his creditors and at the time that the order was set aside the Trustee in Bankruptcy sought to persuade the court that he should be able to take the place of Mr Elichaoff and seek a revised order to obtain a lump sum sufficient to pay off the creditors and legal costs. The court refused and now the Trustee of Bankruptcy is pursuing an appeal in the High Court.

This is a bizarre and unprecedented case with a potential to have far reaching consequences. The Trustee is suggesting that Mr Elichaoff would have been entitled to received a substantial settlement from Ms Woodall and that following the bankruptcy the right to pursue that claim passed to the Trustee.

Ms Woodall defends the application on the basis that such a right is personal to Mr Elichaoff and the court ability to consider such a claim ended in any event when Mr Elichaoff died.

It is correct that when a person is made bankrupt the right to bring certain claims transfers to a trustee in bankruptcy. However, solely personal claims such as for personal injury or slander are not included.

The insolvency service’s own technical manual states;
“The Matrimonial Causes Act 1973 (MCA 1973) allows a spouse to seek financial relief following divorce. Such a right does not constitute property (and even if it did, it would be property personal to the bankrupt) and cannot, therefore, form part of a bankrupt’s estate or vest in the official receiver, as trustee.
Generally speaking, any right arising from a marriage would not vest in a trustee in bankruptcy. In short, the trustee is not party to a marriage and cannot, therefore, be party to any rights arising in relation to the marriage.”

In the event that the Trustee is successful in his appeal this will give rise to a potential for claims to be bought by a Trustee within divorce proceedings or even many years later to seek to obtain a financial order to secure money to pay off the creditors. This is because parties rights to bring claims against each other do not automatically terminate when the divorce is finalised. My personal view is that this can not be correct. A spouse or ex spouse can not be forced to pay debts that are not in their name and there is no provision for a court within financial proceedings to consider the right of creditors except for the purpose of identifying the assets available and to establish the parties needs.

We await the decision with baited breath.

Karen Johnson is Director and Family Mediator of Breeze and Wyles Solicitors Ltd. Karen is a highly skilled and experienced Family Solicitor with in excess of 15 years experience of working in Family Law. She is a Resolution Accredited Specialist in the fields of Domestic Abuse and Financial Matters. Karen is additionally a Family Mediator trained by and a member of the Family Mediators Association (The FMA). For more information on how Karen or a member of our specialist team can help you please call 01992 558411 or complete our online enquiry form.


THE ‘DIRECTOR’S FRIEND’ BLOG

workplace-webINTRODUCTION

My name is Richard Cole. I am a Solicitor. I specialise in insolvency dispute resolution and commercial dispute resolution.

I want to introduce myself to you as the ‘Director’s Friend’. That is where I believe that I have the knowledge and experience (over 15 years) to make a difference to you and your business that you have worked so hard to build up that could now be in financial difficulties.

MY EXPERIENCE AVAILABLE TO YOU AS THE ‘DIRECTOR’S FRIEND’

My background is that after my post graduate legal studies I started my career at the Secretary of State (see: https://www.gov.uk/government/organisations/insolvency-service) investigating companies that had been placed into a formal insolvency process. That was with a view to identifying misconduct by the director(s) with the objective of disqualifying that director or director’s from personally acting as such for a period of time.

Upon qualification as a Solicitor I worked in one of the leading niche director disqualification defence and insolvency law firms in the England and Wales acting for clients all around the world.

WHAT IS THE ‘DIRECTOR’S FRIEND’?

In my experience a lot of directors of companies think that with the concept of limited liability they are protected from personal liability. Unfortunately, that is not always the case for an ever increasing number of reasons.

The objective of this blog is to be the ‘Director’s Friend’ with the identification of risk, consequences and to talk about potential solutions.

 THE ‘DIRECTOR’S FRIEND’ BLOG:

Over time the following will be a series of blogs on the theme of directors of companies being landed with a form of personal liability.

As you would expect my blog is for general information and will not and does not constitute legal advice by me or my firm.

Until next time,

THE DIRECTOR'S FRIEND

 


Worrying number of older adults do not have a Will

Independent research conducted by Breeze & Wyles indicates that around half of UK adults have not written a will. The research goes on to indicate that in older people this number rises considerably with the percentage rising to over 60% for over 60s.

The certainties that arise from having a will should not be understated. We set out four reasons why you should make a will

  1. If you die without a will the law will apply to distribute your estate. This rarely reflects what people making wills would wish particularly if they have a spouse;
  2. A will gives certainty to the family of someone who has died at what is a very difficult and stressful time;
  3. Some of your family may be financially dependent on you and by not making a will it is always possible that this person may not be provided for adequately on your death compounding the grief that they feel at your death;
  4. There are legitimate ways in which you can reduce the tax you will pay by dealing with your estate in an appropriate way on your death. Without a will this is not possible.

If you do not have a will and any one or more of the above four items concerns you contact us on 01992 558411 and ask for Donna Collins or Patrice Lawrence.


One More Night

night

Phil Collins announced earlier this year that he was back in a relationship with his ex wife, Orianne Cevey despite the couple divorcing over 8 years ago. During the divorce, Ms Cevey reportedly received a sum representing a huge £25m in the settlement. However, Mr Collins has confirmed this week that Ms Cevey has not offered to return any of those monies and she is under no obligation to do so.

Before applying for Decree Absolute, which is the final stage of the divorce process, it is imperative to ensure all financial matters are resolved and that any future claims are closed down and dismissed where possible. This ensures neither party is able to make any claims in the future against the other, assuming each party has provided full and frank financial disclosure and has not concealed any assets in the process.

In the event Mr Collins chooses to remarry, he would be wise to seek legal advice on pre-nuptial and post nuptial agreements to avoid any future disputes over finances.

Breeze and Wyles Solicitors Ltd are experienced in providing specialist advice on all areas of matrimonial law, including divorce and related financial matters as well as pre-nuptial and post-nuptial agreements.

Lisa Honey is a family solicitor at Breeze and Wyles Ltd specialising in family law and deals with matters covering a range of issues including divorce and financial settlements, separation following the breakdown of a relationship, children matters and declarations of trust. Lisa is also an honorary solicitor providing advice at the Citizens Advice Bureau in Cheshunt and Ware.

For more information on how we can help you please do not hesitate to contact a member of our team on 01992 5585411 or alternative complete our online enquiry form.


Brexit and its unpredictable impact

The Insolvency Service figures for the last quarter ending at the start of October show that the number of insolvencies remained flat despite the Brexit vote. Many had reflected prior to the referendum that Uk Companies would see an immediate downturn in trade and that this would be shown by a rise in the number of company insolvencies. This has not been the case. In the short term those companies with no foreign trade have seen little or no contraction in business while those with foreign trade have been able to benefit from the competitiveness of the pound against most foreign currencies.

The Managing Director of Breeze & Wyles Solicitors Limited, Brendan O’Brien said: “Commentators were quick to state the immediate downsides of Brexit. The short term predictions were wrong. What does the medium and long term hold for British business? Business should not lose confidence. The road ahead will be bumpy but directors need to ensure that whatever the outcome they are protected from risk. Breeze & Wyles will be providing updates on how to achieve a risk free management environment over the coming weeks and months. So watch this space.”

Web site content note: 

This is not legal advice; it is intended to provide information of general interest about current legal issues.