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LondonlawyerJ
LondonlawyerJ, Solicitor
Category: Property Law
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Experience:  Experienced solicitor
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I purchased a leasehold flat in 2006. At the time, the purchase

Resolved Question:

I purchased a leasehold flat in 2006. At the time, the purchase contract contained a clause stating that I was not allowed (by the freehold owner) to rent out the property. In 2008 I came to a verbal agreement with the freeholder to rent the property out, and have been renting it out since.

The freeholder is now looking to sell his property and the freehold. So my questions are:

1. is the original 'rental prevention' clause in the contract (i.e. preventing me from renting out the property) enforceable by the current freeholder?
2. if the freehold is sold, will the 'rental prevention' clause in the contract enforceable by the new freeholder, given that the original contract which contained the clause was with the current freeholder and not the new one?
3. if I would like to continue renting out the property after any sale of the freehold, is my best option to remove the 'rental prevention' clause? If so what is the best way to go about this i.e. does the original contract need to be amended, or can the freeholder and I agree an 'addendum' stating that I am allowed to rent the property out? And how would you suggest I formalise this - would a note signed by him and I suffice, or would I need to formally instruct a solicitor to update / draw up the contract?
4. if I work with the current freeholder to remove the 'rental prevention' clause, would a new freeholder be within their rights to add it back in, or prevent me from renting out the flat in another way?

Many thanks!
Submitted: 2 years ago.
Category: Property Law
Expert:  LondonlawyerJ replied 2 years ago.

LondonlawyerJ :

Hello. I am a solicitor wht over 15 years experience. I will try to help you with this.

LondonlawyerJ :

1 & 2 the answer to this will depend on the nature of the agreement you and the current freeholder have come to. Was it just a personal agree,tm to let you rent out the flat or did he agree that he was waiving the non letting clause?

LondonlawyerJ :

3 if the clause is still in place then contracts can always be amended. However ,it is likely that the freeholder may only agree to the amendment you want if you are wiling to pay him something for it.

Customer:

Hi there. Thanks for the prompt response. Re. 1 & 2, he didn't specifically say he was waiving the non-letting clause. I had tried to sell the property but struggled, so the starting agreement was that I could rent it out until the market picked up, but I have been allowed to rent it out since

Customer:

Thanks for the advice on point 3. If I get the contract amended what is your view on point 4?

LondonlawyerJ :

Ok. It is unlikely with that kind of lose arrangement that the rental prevention clause will be affected. I don't think he could enforce it immediately. He would need to give you reasonable notice that he wanted to take advantage of that clause again. (eg to the end of the current rental agreement). But he can bring it back to life ff he wants. Unless your current freeholder varies the agreement with you before sale and sells the varied agreement to the new freeholder the new freeholder will have the same rights as the current one.

LondonlawyerJ :

4. If the rental prevention clause has been removed before sale and the sale to the freeholder doesn't include that clause then the new freeholder will not get the benefit of the rental prevention clause.

Customer:

Thanks very much for the response. I will ask the current freeholder to remove the clause before sale. I'm assuming the safest option will be to get the contract officially amended by a solicitor, but in advance of that what will the legal status of the clause be if:, what is the legal status of the best way for me to get the clause formally waived / removed? Is it binding if he verbally agrees, or do I need to get it in writing? it with the current freeholder and then find a solicitor on the Law Society website to draw up the changes? Or will it suffice for him to write something down on paper saying he

Customer:

Sorry, please ignore the last post!

Customer:

Thanks very much for the response. I will ask the current freeholder to remove the clause before sale. I'm assuming the safest option will be to get the contract officially amended by a solicitor, but in advance of that what will the legal status of the clause be if:


1. he verbally agrees to waive the clause (but in advance of the contract being formally amended)

2. he agrees in writing to waive the clause (but in advance of the contract being formally amended)


LondonlawyerJ :

If the landlord agrees to vary the clause before sale then as long as he actually does vary it then you have no problem. If he agreed to a variation but then transfers the property to the new freeholder without properly altering your contract then the situation is more complex, but if you can prove that your terms were varied then the new freeholder's action, if any, will lie against the old freeholder who has misled him at the time of purchase.

LondonlawyerJ :

If you can prove the variation you will be able to rent out your property but if the agreement is verbal it will be harder to prove.

Customer:

Great, thanks very much for your help!

LondonlawyerJ, Solicitor
Category: Property Law
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Experience: Experienced solicitor
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