Advice Needed Please on Rental Obligations

Rafynglas

Hi,

I am hoping to get a second opinion/advice on my rental situtation. Here's what's happened;

My husband and I are in a rental contract until 31/01/13. We found a house we want to buy (first time buyers) and with the agreement of our landlord and agency the rental property was put back onto the market and it was agreed that we would be released from our rental contract when new tenants took over.

A few weeks ago the agency told us that new tenants had been found. We were waiting to set a completion date for our house purchase but I was really really cautious not to make any assumptions and act too soon until we could be sure that we were released from the rental contract, as we can't afford too much overlap of rent and mortgage. I waited and waited until the agency finally confirmed that the situtation was finalised, that nothing was provisional anymore and we were safe to go ahead with our house purchase. I checked and double checked with them, stressing that it was vital that this was a situation that could not fall through. They said yes it was all final, the sign outside the house changed to 'Let', and a new final date of occupancy and rental payment was agreed. So we set a completion date for our house purchase of end of November.

Last week the rental agency called to say that the new tenants have backed out and that we were still obliged to pay rent until end of Jan 13 unless new tenants were found. I guess there's nothing we can do about this, but it just feels so unfair that they told us everything was final and we made a new agreement with them. I would never have set a completion date on our house purchase if I had known that the new tenants could still back out. Now we are facing a financial crisis because of the mis-information received from the rental agency.

Is anyone able to comment on whether this is just bad luck for us, or do we have a case to argue?

Thanks

pmlindyloo

Do you have in writing that a new final date of occupancy and rental payment was agreed? If so then I believe that this would be a good reason for keeping to those terms.

However, it would be very difficult for the LA/LL to give such an assurance unless the incoming tenant signed a contract which is often not done until a day or so before they move in.

Have you actually exchanged on the new house? (Exchange and completion are two different things)

if you haven't then this will give you some breathing space.

Otherwise, if the LL won't budge you will just have to keep your fingers crossed that new tenants are found soon.

DRP

We found a house we want to buy (first time buyers)

OP, this doesn't sound like you have proceeded very far into the purchase process (unless you can provide more information to clarify this).

It is very likely (including xmas, new year etc) that you will need all the time from now until your AST ends (31st Jan) to complete on your house purchase. In which case, you have no need to worry about leaving your rented home early.

Rafynglas

Sadly nothing in writing regarding the new agreements.

We have already exchanged and have now set the completion date.

I didn't realise that rental contracts are left until the last minute. The agency were very misleading as they were saying all the right things about it being finalised which I wrongly took to mean that a contract was in place. I even think I asked that specifically but can't remember the exact wording used.

Is it normal to put a 'Let' sign up before a contract is signed?

pmlindyloo

Rafynglas wrote: »

Sadly nothing in writing regarding the new agreements.

We have already exchanged and have now set the completion date.

I didn't realise that rental contracts are left until the last minute. The agency were very misleading as they were saying all the right things about it being finalised which I wrongly took to mean that a contract was in place. I even think I asked that specifically but can't remember the exact wording used.

Is it normal to put a 'Let' sign up before a contract is signed?

Usually what happens is that the new tenant pays a non refundable holding deposit to secure the property. It sounds as if they may have lost this. Let signs can be put up when the holding deposit is taken.

Try not to worry too much. It sounds as if the house is 'rentable' so it may not be too long before they find new tenants.

Just as an aside. Is your deposit protected in one of the deposit protection schemes and did you receive information about this? (Just trying to see an alternative route in case all else fails )

Fire_Fox

A tenancy agreement is a legally binding contract, it can only be ended by one party serving notice to quit (in writing) and the tenant vacating/ being evicted OR the landlord accepting early surrender (in writing). The landlord could/ should not have signed a new AST with new tenants until your contract had been formally surrendered (in writing) or he risks being beholden to two lots of tenants with one property - basically the two contractual arrangements involving old and new tenants are separate issues. If you don't only have the verbal agreement of the agent sorry but you have misunderstood contract law. Please always deal with formal situations formally, ie. in writing.

Rafynglas

pmlindyloo wrote: »

Just as an aside. Is your deposit protected in one of the deposit protection schemes and did you receive information about this? (Just trying to see an alternative route in case all else fails )

Yes it is, and we do have the paperwork for it. What are you thinking?

Rafynglas

Fire_Fox wrote: »

A tenancy agreement is a legally binding contract, it can only be ended by one party serving notice to quit (in writing) and the tenant vacating/ being evicted OR the landlord accepting early surrender (in writing). The landlord could/ should not have signed a new AST with new tenants until your contract had been formally surrendered (in writing) or he risks being beholden to two lots of tenants with one property - basically the two contractual arrangements involving old and new tenants are separate issues. If you don't only have the verbal agreement of the agent sorry but you have misunderstood contract law. Please always deal with formal situations formally, ie. in writing.

I do begrudgingly accept that having nothing in writing leaves us without a leg to stand on. The agency still gave us incorrect information by saying that the agreement was final. We could lose out heavily by having believed them.

So what should we have done? If nothing is certain until the new tenants have signed and we have formally surrendered, yet this doesn't happen until the very last minute before we would be required to vacate the property, then how would we safely set a completion date for the house purchase? Either;
1) Wait until the tenancy situation is formally signed off, then set a completion date. As no house seller is going to agree to a completion date with only a day or so notice, we are without a home for several weeks or longer.
2) Set a completion date in advance of having formally surrendered the tenancy, running the risk of this going wrong (what we ended up doing).

What could have been done to create a risk free situation?

Rafynglas

Eton_Rifle wrote: »

Not signing a fixed term contract!

How helpful!

Fire_Fox

Rafynglas wrote: »

I do begrudgingly accept that having nothing in writing leaves us without a leg to stand on. The agency still gave us incorrect information by saying that the agreement was final. We could lose out heavily by having believed them.

So what should we have done? If nothing is certain until the new tenants have signed and we have formally surrendered, yet this doesn't happen until the very last minute before we would be required to vacate the property, then how would we safely set a completion date for the house purchase? Either;
1) Wait until the tenancy situation is formally signed off, then set a completion date. As no house seller is going to agree to a completion date with only a day or so notice, we are without a home for several weeks or longer.
2) Set a completion date in advance of having formally surrendered the tenancy, running the risk of this going wrong (what we ended up doing).

What could have been done to create a risk free situation?

I would say nothing is final until you have formally offered surrender for a specific date and this has been accepted in writing by your landlord. The new tenants most definitely should not be signing before your surrender has been agreed or the landlord is contracted to two lots of tenants. So the new tenants are not directly relevant, they are not party to your contract with the landlord, they have their own totally independent contract.

What could have been done is to get the acceptance of surrender in writing from the landlord as already stated! Or don't buy a house until you are in a statutory periodic tenancy, then accept an overlap of a couple of weeks. I don't think the agency are blameless by any means, but you do know a verbal contract is only worth the paper it is written on. It works the same for a cancellation of that same legally binding contract. It is a formal situation for which a formal method of communication is appropriate.

tbs624

Fire_Fox wrote: »

A tenancy agreement is a legally binding contract, it can only be ended by one party serving notice to quit (in writing)....

NTQ not applicable to ASTs - s21 is not an NTQ.It is a Notice of Intent & merely confirms a date after which the LL can seek repossession of th eproperty via the courts.