Here is a question to the blog clinic fast track from Jo who is a landlord:
Hello, I would be really grateful for your opinion.
I rented out a property under an AST dated 19 October 2016. The AST rolled into a contractual periodic tenancy which began on 19 October 2017, with rent paid quarterly in advance, on the 19th of October, January, April and July.
I needed to sell the property and therefore asked my agent to serve a Section 21 notice. Although I asked the agent to serve the notice on 18 January 2020 requesting the tenant to leave on 18 April 2020 (the last day of a tenancy period), they put the wrong dates: the S21 was dated 20 January, requiring my tenant to leave the property on 20 April.
The tenant, having seen the error, informed me of her intention to remain in the property until the next period of the tenancy, ie 19 July, to which I agreed.
In the event, my tenant found a new flat and asked to meet me at the property on 9 March to hand over the keys, which I did. The flat has remained untenanted since then.
I have returned the tenant’s deposit, but she is now asking for a proportion of the rent that she paid for the period 19 January to 19 April to be refunded to her.
Please could you advise on whether I am obliged to return a proportion of the rent? The tenant has given me until 12 April to do so, otherwise she will begin court proceedings. I would also be interested to know the position regarding Council Tax and other bills (I am prepared to pay these – just wondered what the official position is.)
Many thanks in advance for your help.
Answer
It’s a difficult one as the answer really is ‘it depends’. The question is – did the tenancy end on 9 March or not?
Was the tenancy ended by a tenant’s notice to quit?
All periodic tenants have the right to end their tenancy by giving notice of not less than the period of their tenancy.
A ‘period of the tenancy’ in your case though is unusually long at three months. When your tenant handed back the keys on 9 March she had not given anything like the requisite notice period.
So the tenancy was not ended by a tenants notice to quit. In fact, the notice she had given had been to vacate on 19 July.
Was the tenancy ended by agreement?
The tenant may well say that by accepting the keys on 9th March you were agreeing to a ‘surrender’ of the tenancy which would then have ended at that time. If this is the case, then she would be entitled to the refund of her money.
It’s hard to say whether this is the case or not as I don’t know exactly what was said at that meeting.
The situation prior to that meeting was that the tenant had paid up to 19 April and had given notice to leave on 19 July.
What I would have advised you to say at that meeting was that although you were accepting the keys this was not on the basis of a surrender of the tenancy as at that date and that she would remain liable until the end of the period she had paid for. I would also have advised you to immediately confirm this in writing.
Even better would have been for you to write to her immediately before the meeting on 9 March to say that although you would accept the keys in order to secure the property as she was vacating, this would be on the basis that she would remain liable for the rent until the end of the quarter, but that you would waive any further right to rent in lieu of notice.
There is a case on this point which I wrote about here.
As landlords are entitled to notice when tenants vacate a periodic tenancy and as it looks as if you had received no or very little notice of your tenant’s intention to vacate on 9 March I would be surprised if any Judge would order a refund of the rent paid in advance. It is possible that you could even be entitled to rent until 19 July.
In conclusion
It really depends on what was said and agreed at and about the meeting on 9 March and the basis upon which you accepted the keys. Was it acceptance of the end of the tenancy as at that date, or were you accepting them because she was leaving in order to keep the property secure?
It is not totally impossible that a Judge in a court hearing would find that you agreed to end the tenancy on 9 March and order a proportionate refund of the rent. However, I think it is more likely that a Judge would find that you had accepted the keys to accommodate the tenant and that she remains liable to the end of the period.
A plan of action
I would suggest therefore that you write to her saying that there was no intention on your part to accept a surrender as of 9 March. You accepted the keys in order to secure the property as she was leaving and that technically she was liable until the end of the notice period she had previously given ie 19 July.
Go on to say that, without prejudice, you are prepared to accept the rent paid up to 19 April in lieu of notice but that if she brings legal proceedings you will defend and counterclaim for the rent in lieu of notice to 19 July.
It might be an idea also to send her a cheque for a smaller amount, say 1 week’s worth of rent, under a separate ‘without prejudice’ letter saying that although you do not accept that she has any claim, you are prepared to pay this sum without prejudice and without any acceptance of liability, in full and final settlement of her claim.
If she then accepts the cheque and pays it into her bank account she will be deemed to have accepted your offer and will not be able to proceed further.
If she refuses the offer then you will have to decide whether you are willing to fight things out with her in court or not. I think you would be more likely to win but it is by no means certain.
So far as the utilities are concerned, liability for these will depend on the terms of your tenancy agreement and when the tenancy is deemed to have ended.
