Help - does Lease have to be honoured when house is in receivership?

podgec20

Hi everyone,

I have been in the same rented house for 6 years. This June I signed a further 2 year lease until June 2015 with my fiance. 4 months into the lease (October) we get a letter saying house has gone into receivership and a letter from the appointed property agent 4 days later threatening to change the locks as no contact made! We were bombarded with calls about allowing access to view the property to provide a key copy and for valuation.We were eventually given bank details to lodge payment to after about 4 attempts. (all contact was in relation to them SELLING the house) Concern for our personal belongings while leaving potential strangers to view the house while we were at work were dismissed. My offer for putting personal valuables into one room locked was rendered "unreasonable". As a result we spoke to Threshold who wriote to, rang and emailed the named contact in receiver company without reply (all within last 3 weeks) . So at mo we are in limbo.Our contract specifies that we do not have to allow access to view the property until 4 weeks before lease expires. We are not allowing them to view the house until our rights are clarified but there seems to be a grey area about a lease having to be honoured if house goes into receivership. We are concerned if it will be rendered null and void due to receivership issue . Has anyone here had a similiar experince or have any heads up they can give?. This whole event has caused an awful amount of stress and dont fancy this to drag on any longer that it needs to. Thanks in advance

gaius c

Not meaning to frighten you but you have very few rights.
Your contract was with the landlord. He is now gone and you're in something of a legal limbo as you & the bank have no contract together.
Link to some info here.

djimi

Im not sure what the story is legally, but if the reciever is happy to take your rent money then they would have a very hard time arguing that they are not your landlord, and while the lease itself may no longer be valid, I dont see why you wouldnt have part 4 tenancy rights.

To be honest your best bet is to seek proper legal advice to clarify your situation.

odds_on

As djimi says, if the receiver accepts rent, then he effectively becomes your landlord. However, there may be a problem in getting your deposit back.

My understand is - and stand to be corrected by a legal expert:
If the property was a but-to-let mortgage, then your fixed term lease is probably still valid.

If you rented from someone who decided to rent out his PPR, then probably your lease is invalid as the house owner probably had a clause in his mortgage agreement that the house cannot be rented and must remain the owner's PPR.

podgec20

odds_on wrote: »

As djimi says, if the receiver accepts rent, then he effectively becomes your landlord. However, there may be a problem in getting your deposit back.

My understand is - and stand to be corrected by a legal expert:
If the property was a but-to-let mortgage, then your fixed term lease is probably still valid.

If you rented from someone who decided to rent out his PPR, then probably your lease is invalid as the house owner probably had a clause in his mortgage agreement that the house cannot be rented and must remain the owner's PPR.

Ya I'm pretty it was a buy to let mortage alright as landlord was multiple property owner. Fingers crossed they will have the decency to honour the lease

Marcusm

If the receiver has accepted rent from you then he is the landlord for the purposes of Residential Tenancies Act. You are entitled to exclusive possession of the property and are not required to permit any viewings. I imagine you have been there more than 6 months and, irrespective of the change of landlord, your tenancy for part 4 (security of tenure) purposes is likely to run from your initial start date. They can give yo Joyce to quite as they are sellng but cannot force to to have viewings. Speak to the agent, make it clear that up have been apprised of your rights and let him know the basis on which you are willing to permit viewings. Be prepared to be given a termination notice but if you don't want viewings and are willing to take the consequences, they cannot force you.

The_Conductor

Marcusm wrote: »

If the receiver has accepted rent from you then he is the landlord for the purposes of Residential Tenancies Act. You are entitled to exclusive possession of the property and are not required to permit any viewings. I imagine you have been there more than 6 months and, irrespective of the change of landlord, your tenancy for part 4 (security of tenure) purposes is likely to run from your initial start date. They can give yo Joyce to quite as they are sellng but cannot force to to have viewings. Speak to the agent, make it clear that up have been apprised of your rights and let him know the basis on which you are willing to permit viewings. Be prepared to be given a termination notice but if you don't want viewings and are willing to take the consequences, they cannot force you.

On what basis are you making these assumptions? The PRTB and Citizen's Advice Bureau are suggesting that in cases where the house is repossessed (or put into Receivership), the lease is null and void, and the tenant, if he or she remains there, is there on a month by month basis, until such time as they accrue legal rights independent of the original lease, which is now not worth the paper its written on.

Marcusm

The_Conductor wrote: »

On what basis are you making these assumptions? The PRTB and Citizen's Advice Bureau are suggesting that in cases where the house is repossessed (or put into Receivership), the lease is null and void, and the tenant, if he or she remains there, is there on a month by month basis, until such time as they accrue legal rights independent of the original lease, which is now not worth the paper its written on.

Firstly, (without meaning to be pedantic), there is no such thing as the Citizen's Advice Bureau in Ireland - the similarly named Citizen's Information Centre performs a different function.

There was a great analysis some months ago as to the impact of the appointment of a receiver to a let property which included consideration of statute going back to Deasy's Law. Inter alia, the point cogently made was that the mortgage (the charge, not the loan) effectively frustrated the lease unless it had been consented to by the bank (or if it predated the mortgage). The lease thus becomes more of an executory contact between the owner and tenant rather than a lease conveying an interest in the property enforceable against subsequent "owners".

In the current circumstance, i have not suggested that the receiver (appointed by the bank enforcing its entitlements under the mortgage is bound by the lease and it is not so bound unless it effectively adopted the lease through its actions post appointment. It does sound as if the receiver has consented to the OP's continued occupation of the property as it has not simply given him short dated notice to quit. That may not necessarily amount to becoming subject to the lease.

The key to this case is the Residential Tenancies Act the basic provisions (including part 4) are enforceable against a "landlord" who is someone who has accepted rent in respect of a property. The tenant's rights are specified in respect of the property and his duration in occupation of the property. At no point is it required that it be the same landlord. There have been a number of opinion pieces to the effect that the full effect of the RTA on security of tenure must work in such a manner (ie carrying over the tenant's security of tenure from landlord to landlord) in order to reach a purposive conclusion to the law - it could otherwise be frustrated very easily. Irrespective of whether part 4 applies, the receiver is selling the property so can give notice to quit. What is certain is that if the receiver has accepted rent, he is the landlord and is thus bound by the RTA and minimum standards such as quiet and exclusive enjoyment ofthe property meaning that no viewings can be enforced.

djimi

The_Conductor wrote: »

On what basis are you making these assumptions? The PRTB and Citizen's Advice Bureau are suggesting that in cases where the house is repossessed (or put into Receivership), the lease is null and void, and the tenant, if he or she remains there, is there on a month by month basis, until such time as they accrue legal rights independent of the original lease, which is now not worth the paper its written on.

If the receiver is taking rent money from the tenant then how is it any different to any other sale where a new landlord takes over the tenancy? Under normal circumstances, where a tenancy is sold, the tenancy does not "reset", and the part 4 rights apply from the time the tenancy began. Why would this be any different, just because its a company that is now the landlord rather than an individual?

Im not arguing with you btw; I just dont fully understand how it works.

KarKar10

Hi everyone, dont want to hijack this thread but I'm in a very similar situation myself. Moved into a property on 18/10/13 and signed a years lease. However I intend on renting this property for the foreseeble future as I re-decorted (with letting agents/Landlords permission) and want to rent a home longterm as I have a young baby. Previous tenant was there 7 years.

However on the 7/11/13 I was served with papers off a well known banking company to say that my landlord had gone into recievership and that I effectively will be paying them my rent from now own.

I contacted both my letting agent and the bank to see what what the story was and basically have heard nothing back. I had never met my landlord before but he called in one Saturday evening dumbfounded that this has happened to him....surely they would have notified him that his mortgage was in arrears or would they??

As I'm only in the property a month I'm nowhere near the 6 months that is needed for the part 4 of the tenancy agreement to come into place.

The bank requested on the papers that were served to me, that I forward my details and a copy of my contract to them, which I did immediately and they said they would arrange the payment details for my rent but as of yet i still havent heard anything, my rent was due on the 18th and I have just put it aside.

A few things have cropped up in the property that need doing for example boilers last service was in 2005 and I'd like to get the chimney cleaned before the cold weather comes in. Who takes responsibility for these? The bank are quite happy to take the responsibility of taking rent but are they obliged to to up-keep the property. I have contacted Thresehold and there are still no clear guidelines to protect tenants in this situation.

podgec20

KarKar10 wrote: »

Hi everyone, dont want to hijack this thread but I'm in a very similar situation myself. Moved into a property on 18/10/13 and signed a years lease. However I intend on renting this property for the foreseeble future as I re-decorted (with letting agents/Landlords permission) and want to rent a home longterm as I have a young baby. Previous tenant was there 7 years.

However on the 7/11/13 I was served with papers off a well known banking company to say that my landlord had gone into recievership and that I effectively will be paying them my rent from now own.

I contacted both my letting agent and the bank to see what what the story was and basically have heard nothing back. I had never met my landlord before but he called in one Saturday evening dumbfounded that this has happened to him....surely they would have notified him that his mortgage was in arrears or would they??

As I'm only in the property a month I'm nowhere near the 6 months that is needed for the part 4 of the tenancy agreement to come into place.

The bank requested on the papers that were served to me, that I forward my details and a copy of my contract to them, which I did immediately and they said they would arrange the payment details for my rent but as of yet i still havent heard anything, my rent was due on the 18th and I have just put it aside.

A few things have cropped up in the property that need doing for example boilers last service was in 2005 and I'd like to get the chimney cleaned before the cold weather comes in. Who takes responsibility for these? The bank are quite happy to take the responsibility of taking rent but are they obliged to to up-keep the property. I have contacted Thresehold and there are still no clear guidelines to protect tenants in this situation.

That is very similiar to our positon Karkar10, we also have it in our lease that the landlord is to pay the cost of the refuse and as he has only paid it until end of next month, we are envisaging hassle where they will not honour this part of lease for the new year. In this event we were planning on deducting the amount of the refuse from the rent due if they were unwilling to honour it. If they are not willing to upkeep the house for yourself with boiler service etc there is also option of witholding rent until they commit to doing this which could also be considered. Interesting to see if their attitude changes then!!! Also with regard to house insurance, it is interesting to see if houses in receivership are insured in the event of break in or accidents etc. It's the definition of limbo!!

runawaybishop

podgec20 wrote: »

That is very similiar to our positon Karkar10, we also have it in our lease that the landlord is to pay the cost of the refuse and as he has only paid it until end of next month, we are envisaging hassle where they will not honour this part of lease for the new year. In this event we were planning on deducting the amount of the refuse from the rent due if they were unwilling to honour it. If they are not willing to upkeep the house for yourself with boiler service etc there is also option of witholding rent until they commit to doing this which could also be considered. Interesting to see if their attitude changes then!!! Also with regard to house insurance, it is interesting to see if houses in receivership are insured in the event of break in or accidents etc. It's the definition of limbo!!

There is no option to withhold rent. Instead you have the option to write to the landlord giving a date for the service (bin collection or essential boiler service etc) to be carried out, and if it is not then you can subtract it from the rent and provide receipts to them for work carried out. You don't "withhold" the rent as that implies you will be giving it back to them at some stage.

djimi

Deducting the cost of maintenance work from the rent would probably be something that the bank/receivers would be favorable to actually. Gets them off the hook from certain obligations if the tenant can sort things themselves.

odds_on

Interesting document from the Ulster Bank:
http://www.ulsterbank.ie/documents/roi/A_residential_tenants_guide_to_Receivership.pdf

Seems it puts the kibosh on much of what has been said on this thread (including myself) - though it is obviously written with the interests of the banks and receivers at heart.

The_Conductor

odds_on wrote: »

Interesting document from the Ulster Bank:
http://www.ulsterbank.ie/documents/roi/A_residential_tenants_guide_to_Receivership.pdf

Seems it puts the kibosh on much of what has been said on this thread (including myself) - though it is obviously written with the interests of the banks and receivers at heart.

This is where a receiver has been appointed, as opposed to the property itself repossessed? I know its only a subtle difference- it could be vastly different though?

It is definitely interesting- and thankyou for the link the UB document- its very worthwhile reading.

odds_on

The_Conductor wrote: »

This is where a receiver has been appointed, as opposed to the property itself repossessed? I know its only a subtle difference- it could be vastly different though?

It is definitely interesting- and thankyou for the link the UB document- its very worthwhile reading.

As yet, I haven't had time to study it, just read through it quickly. But it seems that a receiver can get away with just about anything by not accepting any responsibility as he is acting as an agent (similar, I suppose to an estate agent acting as an agent for the landlord).

The same really when a receiver sells a property for a bank - there is no come-back if there is a problem as there would be if buying from a private individual.

The_Conductor

No upside for a tenant to be honest- if you have a problem the ball is in the landlord's court- and as the landlord isn't getting the rent and is doubtless being harassed by the bank- they're going to have precisely zero interest in fixing any issues that might arise.

I'd seriously walk, if I were put in this situation- its not tenable other than for the very very short term, while seeking alternate accommodation.

Marcusm

The_Conductor wrote: »

No upside for a tenant to be honest- if you have a problem the ball is in the landlord's court- and as the landlord isn't getting the rent and is doubtless being harassed by the bank- they're going to have precisely zero interest in fixing any issues that might arise.

I'd seriously walk, if I were put in this situation- its not tenable other than for the very very short term, while seeking alternate accommodation.

I disagree; I have rented a property for the past 5 years initially from a Liam Carroll owned company through it's receivership and on into ownership by Kennedy Wilson. As regards dealing with issues, it continued getting better through the receivership and on into independent ownership.

I don't think it's possible to generalise. However, if a receiver was appointed who failed to undertake to honour deposits but who wished to continue to receive the rent, I suspect that he might be short of the rent for the last month in the vast majority of cases. Frankly, I have difficulty seeing a receiver not confirm liability for the deposit unless he concurrently serves a notice to quit.

As regards the document, it fairly agrees with what I have stated earlier albeit that it is silent on the OP's initial issue as regards viewings. It does note that the provisions of the RTA do apply which I would take it as a tacit acceptance that the property can't be entered except for the purposes of legitimate inspections.

odds_on

Marcusm wrote: »

I disagree; I have rented a property for the past 5 years initially from a Liam Carroll owned company through it's receivership and on into ownership by Kennedy Wilson. As regards dealing with issues, it continued getting better through the receivership and on into independent ownership.

I don't think it's possible to generalise. However, if a receiver was appointed who failed to undertake to honour deposits but who wished to continue to receive the rent, I suspect that he might be short of the rent for the last month in the vast majority of cases. Frankly, I have difficulty seeing a receiver not confirm liability for the deposit unless he concurrently serves a notice to quit.

As regards the document, it fairly agrees with what I have stated earlier albeit that it is silent on the OP's initial issue as regards viewings. It does note that the provisions of the RTA do apply which I would take it as a tacit acceptance that the property can't be entered except for the purposes of legitimate inspections.

I hate to be pedantic, but in Irish Residential tenancy law, there is no notice to quit - it is a Notice of Termination.

Why the Irish law writers have to invent new elongated terms is beyond me.

Marcusm

odds_on wrote: »

I hate to be pedantic, but in Irish Residential tenancy law, there is no notice to quit - it is a Notice of Termination.

Why the Irish law writers have to invent new elongated terms is beyond me.

That's not pedantic; as I didn't capitalise it, I need not use the statutory words and could have written "sent them a note instucting them to leave the property" - that's my pedantic revision of your post :cool:.

djimi

odds_on wrote: »

Interesting document from the Ulster Bank:
http://www.ulsterbank.ie/documents/roi/A_residential_tenants_guide_to_Receivership.pdf

Seems it puts the kibosh on much of what has been said on this thread (including myself) - though it is obviously written with the interests of the banks and receivers at heart.

Id be interested to see what would happen if parts of this were challenged legally. Put simply, if the receiver is accepting rent from the tenant then they should be classified as the landlord. That being the case, I dont see how they can deny their obligations to the tenant as set out in tenancy law.

Perhaps Im being overly simplistic in my thinking, but as far as I see it, the receiver either recognizes the tenancy or they dont. If they dont recognize the tenancy then ask the tenant to leave, but dont take rent from them in the meantime. By taking rent they are acknowledging the tenancy, and should assume the responsibilities and obligaitons that go with it.

the_syco

odds_on wrote: »

Interesting document from the Ulster Bank:
http://www.ulsterbank.ie/documents/roi/A_residential_tenants_guide_to_Receivership.pdf

From the above link...

WHAT ABOUT THE DEPOSIT I PAID UNDER MY LEASE - WHO PAYS
THAT BACK TO ME?

Your landlord remains liable to return your deposit to you
(unless you forfeit it, for example, by not paying your rent
or by damaging the landlord’s property). The receiver is not
liable to repay the deposit you paid to your landlord. Very
occasionally, however, a receiver may pay deposits back to
tenants (for example, if the receiver wishes tenants to agree
to end their leases early to enable the bank sell the landlord’s
property in vacant possession). However, the receiver has no
legal obligation to do this.
If you enter into a tenancy when a receiver has already been
appointed, you should ensure that the lease makes clear at
the outset who is responsible for the return of your deposit at
the end of the tenancy.

This does not bode well. By the time you leave, the landlord will probably not own the house, and thus how exactly do you file a PTRB complaint against someone who no longer owns the house that you want the deposit from?

Seems that the best option should the house go under receivership is to get your deposit and run away.

podgec20

Thanks to everyone for their feedback and experiences. Just an update, I emailed maintenace department of management company explaining that there is an issue with boiler and needs to be serviced. Having heard nothing by following afternoon, I emailed person who is over maintenance (asked for direct persons email as envisaged an issue with them responding initially) and was told that the usual person in SALES were looking after said maintenance issue. 2 hours later I get a voicemail from the usual person in SALES who is plaguing us to allow access for valuation asking for an appointment to allow access to the house for valuation purposes!!! I have not returned the voicemail but am taking this as a bullying tactic by letting agent, eg "we wont service your boiler unless you allow access to value the house" which under my lease we do not have to do until 4 weeks until end of lease (May 2015) We will pay to service boiler ourselves, then deduct it from rent and email the receipt when paying. Only way to get aroud their tactics as if we go through them they wil probably bring a valuer with them !!!

runawaybishop

podgec20 wrote: »

Thanks to everyone for their feedback and experiences. Just an update, I emailed maintenace department of management company explaining that there is an issue with boiler and needs to be serviced. Having heard nothing by following afternoon, I emailed person who is over maintenance (asked for direct persons email as envisaged an issue with them responding initially) and was told that the usual person in SALES were looking after said maintenance issue. 2 hours later I get a voicemail from the usual person in SALES who is plaguing us to allow access for valuation asking for an appointment to allow access to the house for valuation purposes!!! I have not returned the voicemail but am taking this as a bullying tactic by letting agent, eg "we wont service your boiler unless you allow access to value the house" which under my lease we do not have to do until 4 weeks until end of lease (May 2015) We will pay to service boiler ourselves, then deduct it from rent and email the receipt when paying. Only way to get aroud their tactics as if we go through them they wil probably bring a valuer with them !!!

You don't have to let anyone in to value the house, no matter what your lease says.

Nekarsulm

Not only do you not need to let them in, but most valuations are being done on a "drive by" basis. Indeed many "blocks" of valuations, where an agency receives , say, 100 properties to value within a set time frame, often only a grid reference is provided and it my be specified that the owner/tenant should not be made aware of the valuation taking place.

podgec20

still getting contact from them to leave them value the house, leave them stew methinks