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Lettings by resident landlords

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Definition of restricted contracts, which relates to lettings with resident landlords.

The specific definition of a restricted contract is that tenants who are excluded from full Rent Act protection because they have resident landlords[1] will have restricted contracts irrespective of whether furniture or services[2] are provided as will those who share living accommodation with their landlords.[3]

Unfurnished tenancies that began before 14 August 1974 can be regulated tenancies even if there is a resident landlord,[4] but not if the tenant shares living accommodation with the landlord.

Resident landlord

To qualify as resident, the landlord must have been in continuous residence in the same building (or another part of the same flat) since the start of the tenancy. A landlord living in a separate self-contained flat within the same building as the tenant will still be classed as 'resident' unless the building is a purpose-built block of flats. Long periods of absence will not prevent a landlord from being resident. Residence has been held to continue despite the landlord neither sleeping nor cooking at the premises.[5]

Periods of absence

The following periods of absence are specifically disregarded under Schedule 2 and cover situations where the resident landlord dies or sells the property:[6]

  • any period of 28 days immediately following a change in ownership
  • an extension of that 28-day period up to a maximum of six months, if, during the 28-day period, the incoming landlord gives notice in writing to the tenant that s/he intends to occupy another dwelling in the same building as his/her residence. If the tenancy is not terminated during that period and the new landlord has not moved in by the end of the period of disregard, the tenant will cease to have a resident landlord and will either be a regulated or assured tenant (if all other requirements for these tenancies are met). A notice to quit during the period of disregard cannot result in the landlord regaining possession until the end of that period
  • any period of not more than two years from the date on which the landlord's interest (ie lease or freehold of the property) becomes vested in trustees (after bankruptcy or intestacy - where the landlord dies without a will). If notice to quit is served during the period of disregard, then possession can be recovered at the end of the period
  • a period of two years following the landlord's interest vesting in personal representatives, ie an executor of a will who settles the affairs of a deceased person. Section 65 of the Housing Act 1980 amended the rule in the light of the case of Landau v Sloane.[7] It provided that personal representatives can recover possession after serving notice to quit, as if they were resident, without waiting until the end of the two year period
  • any period where the landlord's interest is vested in trustees on trust for a resident beneficiary.

Where the successor is already resident but for some reason (eg s/he is a minor - under the age of holding an interest in land) her/his interest is being held for them by a trust, the period of disregard is indefinite.

Tenants with resident landlords who cease to be resident after 15 January 1989, will probably be regulated tenants unless they had shared living accommodation with their landlord and do not meet the requirement of a regulated tenancy of having a 'separate dwelling' (see the section on Regulated tenancies for an explanation of this term).

[1] s.12 Rent Act 1977.

[2] s.20 Rent Act 1977.

[3] s.21 Rent Act 1977.

[4] para 6, Sch.24 Rent Act 1977.

[5] Palmer v McNamara (1990) 23 HLR 168, CA.

[6] s.12 and Sch.2 of Rent Act 1977 as amended by s.65 Housing Act 1980.

[7] Landau v Sloane (1982) 1 HLR 1.

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