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Doubling Your Rent – How To Maximise Returns When Tenants Hold Over Wrongfully

You may not have come across the Landlord and Tenant Act 1730 or the Distress for Rent Act 1737 and it might seem anachronistic today to rely on statute that is nearly 300 years old. However these Acts contain valuable provisions relating to tenants who fail to give vacant possession of premises at the expiry of their tenancies.

On the expiry of a tenancy which is not subject to any statutory continuation regime, such as the security of tenure provisions relating to business tenancies contained in the Landlord and Tenant Act 1954, the tenant is usually obliged to give vacant possession back to the landlord. If the tenant fails to give vacant possession and holds over following the expiry of the tenancy, the landlord may in certain circumstances be entitled to recover double rent or double the yearly rental value for the premises for the period of the tenant’s holding over. Typically a claim for double rent or double value would be made as part of the landlord’s court proceedings to get vacant possession of the premises from the tenant.

DOUBLE VALUE UNDER SECTION 1 OF THE LANDLORD AND TENANT ACT 1730

Double value may be demanded from a tenant under section 1 Landlord and Tenant Act 1730 where the tenant wilfully remains in occupation of premises after the expiry of its tenancy and the landlord has given the tenant notice in writing demanding vacant possession of the premises. Typically the landlord will give the tenant notice demanding vacant possession to be given on the contractual expiry date of the tenancy. The notice should specify that the landlord will claim double value if the tenant does not give up vacant possession to the landlord on that day.

If the tenant does not give up possession on the due date, the landlord can claim double the yearly value of the premises for the period in which the tenant remains in occupation following the giving of the notice.

Note that the provision applies to tenancies for fixed terms and for tenancies from year to year but not to shorter periodic tenancies. It is also important to remember that the provision has no application where the tenant is entitled to stay in the premises after the expiry of the tenancy by reason of the security of tenure provisions contained in the Landlord and Tenant Act 1954.

DOUBLE RENT UNDER SECTION 18 OF THE DISTRESS FOR RENT ACT 1737

If a tenant has the ability to give notice to quit under the terms of its tenancy and has given the landlord a valid notice to quit and thereafter does not give vacant possession of the premises to the landlord on the date of expiry of its notice, the landlord is able to demand double rent from its tenant under section 18 of the Distress for Rent Act 1737. This provides that where the tenant refuses to deliver up possession at the time stipulated in the tenant’s notice, the tenant must pay the landlord double the passing rent and such double rent must continue to be paid while the tenant remains in occupation.

OBTAINING VACANT POSSESSION

Landlords should ensure that recovery of double value or double rent from their tenants in the circumstances outlined above is carried out hand in hand with the process of obtaining vacant possession of the premises. If the tenant remains in possession of the premise following expiry of the tenancy and the landlord accepts rent from the tenant in respect of the tenant’s occupation without taking steps to obtain vacant possession, a new periodic tenancy could be created, entitling the tenant to remain in occupation of the premises on the terms of the new periodic tenancy and, potentially, subject to the security of tenure provisions of the Landlord and Tenant Act 1954.

SUMMARY

The provisions in these Acts are often overlooked in circumstances where a landlord can rely on them. Notwithstanding the age of these provisions, they remain a useful tool in landlords’ armouries. Tenants who overstay their welcome in rented premises should be aware of the potential cost of doing so.

For further information, please speak to Michael Pidge, Solicitor, Benjamin Lomer, Senior Associate or Julian Johnstone, Head of Druces LLP’s Property Litigation team.

 

This note does not constitute legal advice but is intended as general guidance only. It is based on the law in force in November 2012.