Case Study Details

Facts
We acted for the Landlord. The Tenant (an unincorporated Association) had a long, fully repairing lease, and was required to pay £20 a month (a nominal sum) for rent. The property was also in a state of disrepair. The Tenant failed to pay one month’s rent entitling the Landlord under the terms of the lease to peacefully re-enter the property and forfeit the lease.

Shortly after forfeiture the Tenant agreed to pay the landlords costs incurred as a result of the forfeiture and the nominal rent arrears but failed to make payment.

Six months after the Lease was forfeited the Landlord granted a lease to a new tenant with rent payable at £400 a month.

The Tenant filed an Application for Relief however waited until the final day before the 6-month mark after the lease was forfeited and the application was not served until 10 months after the lease was forfeited. Our client considered the filing of the application to be malicious considering the Tenant had failed to make payment. 

Solution:
We were instructed to file a defence and negotiate a settlement.

The Tenant’s application was flawed in several ways which included but was not limited to:

1. It was not issued and served promptly;
2. Former trustees were included as the applicants as opposed to the current;
3. The trustees’ addresses were not disclosed; and
4. There was substantial disrepair.

We focused on the weaknesses in the Tenant’s application mainly, the former and current trustees’ liability for costs and disrepair. We also pointed out that the former trustees were vulnerable to an application for security for costs having withheld their addresses and for acting as nominal claimants to the current trustees.

By maintaining pressure we negotiated a settlement whereby the former and current trustees agreed to withdraw their application and by way of concession our client agreed to bear it’s own legal costs incurred to the point of settlement.

This enabled our client to keep his better paying tenant and avoided incurring substantial legal costs. Had our client been successful in defending against the application in all likelihood the Tenant nor the trustees would have paid a costs order having little by way of assets to enforce against them.