Existing leasehold legislation responsible for level of landlord and tenant disputes
Nicola Muir, Barrister at Tanfield Chambers and member of Association of Leasehold Enfranchisement Practitioners (ALEP) has stated that the current leasehold legislation is responsible for causing hostility and disputes during the enfranchisement process, due to strict requirements and draconian punishments.
Muir has welcomed proposals from the Law Commission which, if adopted, could benefit both leaseholders and freeholders when going through enfranchisement.
Nicola said: “The current system creates an adversarial environment, whereas what we need is less of the ‘us vs. them’ mentality. It’s the outmoded enfranchisement process – not the individuals involved – that leads to disputes. Instead what we need is scope for more negotiation, open dialogue and process-led interactions.”
As one of the sector’s leading barristers, Nicola has worked on all aspects of landlord and tenant disputes and specialises in property litigation for both residential and commercial cases.
The ALEP member added that enfranchisement claims frequently become hostile because aspects of the legislation can trap the unwary. “If a tenant misses a deadline in the process, the right to an extended lease is lost and a new claim can’t be made for a further year. If the landlord misses a deadline, they may have to accept a low or unfair price for their interest.
“This leads to artificial arguments about the validity of notices and methods of service. By allowing the Courts and Tribunals to take a more holistic approach which focuses on whether the tenant is actually entitled to a new lease rather than on whether they jumped through the necessary procedural hoops, the proposed new system should be easier, cheaper and quicker to operate.”
Enfranchisement is notoriously complex, and few landlords or tenants can undertake the process without professional assistance. The Law Commission is due to publish its report setting out reforms to the current system to make enfranchisement simpler, cheaper and quicker in February 2020.
Nicola concluded: “Recommendations, if implemented, should allow more scope for amicable settlements in lease extension or enfranchisement claims.
“The Law Commission proposes doing away with some of the existing draconian sanctions for both leaseholder and freeholder if key deadlines are missed during the statutory process. The new regime would be more flexible and would give the First Tier Tribunal a much wider jurisdiction to deal with the whole gamut of disputes which can arise in enfranchisement claims.
“It remains to be seen whether the Law Commission’s proposals become law, but they have generally been well received. There is no doubt that a more flexible procedure would open the door to more cases being settled amicably and the scope for disagreements being reduced. In the meantime, landlords and tenants should always try and reach terms within the statutory deadlines.”