Jungle Property Blog

• The agreement to, and payment of, a holding deposit creates a legally binding contract between the landlord (or his agent) and the prospective tenant.
• The contract is commonly called a holding deposit agreement, sometimes referred to as a HDA.
• A HDA is a conditional contract, which grants the prospective tenant both the right and obligation to enter into the proposed tenancy provided the landlord (or his agent) can verify the information provided by the prospective tenant is correct.
• The conditions of the contract can be oral or written, or both. If written, the conditions will be in a document typically referred to as a holding deposit agreement, reservation agreement or proposal to let.
• The conditions of the contract should stipulate the key terms of the tenancy such as the type of tenancy, names of landlord(s) and tenant(s), address of property to be let, initial period of the tenancy including commencement date, amount of rent, amount of tenancy deposit (sometimes referred to as core terms) and specially negotiated terms such as a break clause (sometimes referred to as special conditions).
• Neither party to the contract may insist on the conditions of the contract or the terms of the proposed tenancy being  varied or ‘renegotiated.’ An attempt to do so would ordinarily amount to repudiation of the contract, entitling the innocent party to remedies under contract law. The contract marks the conclusion of negotiations not the starting point. Even if a prospective tenant accepts and signs the landlord’s variations to the tenancy agreement, the new terms contrary to the HDA may not be enforceable for lack of consideration.
• A holding deposit is not a tenancy deposit and is not subject to the statutory tenancy deposit protection scheme, although it will typically be paid towards the first payment of rent under the tenancy, or towards the payment of the tenancy deposit in respect of the tenancy.
• A HDA is not a tenancy it is an agreement for tenancy – a conditional contract, which grants the applicant the right (and obligation) to enter into the proposed tenancy, subject to conditions, and it satisfies the requirements of the offer, acceptance, and consideration in the form of the holding deposit payment. HDAs are thus governed by contract law, not by residential tenancy legislation.
• HDAs should be more significant to the parties’ interests than the final tenancy agreement and they record the key terms and are the basis for entering into the tenancy. Detailed standard form tenancy terms are subject to statutory restrictions and regulatory oversight.
• The tenancy agreement should not deviate from the agreed HDA terms.
• At any one time a tenant should only pay one holding deposit in respect of one property and should decline other proposals in the interim. Conversely at any one time a landlord (or his agent) should only accept one holding deposit in respect of one property and should decline other proposals in the interim.
• The Property Ombudsman, Code of Practice for Residential Letting Agents requires agents provide both parties with a draft or specimen tenancy agreement prior to the prospective tenant becoming liable for a holding deposit associated with the rental of the property except where such opportunity is declined or where the agent holds an instruction to the contrary.
• The HDA can only be cancelled if the landlord is prohibited by section 22 of the Immigration Act 2014 (persons disqualified by immigration status) from granting a tenancy of the housing to the prospective tenant or the prospective tenant provides false or misleading information to the landlord.
• The legal significance of a HDA needs to be emphasised to landlords and prospective tenants and that both parties at the outset that payment of a holding deposit creates a legally binding contract. Tenancy applicants should be provided a draft copy of the tenancy agreement before any HDA is created. Landlords need to be made aware that if the conditions of the contract are satisfied, they cannot “renegotiate” the terms of the lease after a HDA has been agreed.

On 7th September 2023 the UK government issued guidance on damp and mould in rented accommodation. The guidance is 56 pages long, not including linked references, and there are 185 occurrences of the word ‘landlord’. This article provides a summary of what it is landlords should be doing regarding damp and mould in their properties.

The guidance can be found here: Understanding and addressing the health risks of damp and mould in the home

Preventative

• Have clear processes in place to document, manage and act on reports of damp and mould and to identify common issues and trends in your housing.
• Understand the condition of your homes and use this to adopt a preventative approach to dealing with damp and mould, making the necessary interventions to ventilation, energy efficiency and building deficiencies before damp and mould occur.
• Understand that some homes are more difficult to heat, either due to their energy efficiency or cost of living pressures, and that this can make damp and mould more likely to occur.
• Consider what support you can provide or signpost tenants to.
• Support tenants to understand what they can do to reduce damp and mould, where applicable and appropriate. This must never be a substitute for addressing the underlying causes of damp and mould.
• Build relationships with health and social care and other frontline professionals supporting tenants to ensure that every opportunity to identify tenants living in homes with damp and mould is utilised, ‘making every contact count.’
• Ensure staff and any external contractors are aware of the significant health risks associated with damp and mould, the need to address the underlying causes of the issue and not just remove visible mould, are aware of any processes associated with reporting and addressing damp and mould and understand the importance of being sensitive to tenants’ circumstances and vulnerabilities.
• Build relationships with tenants, ensuring that tenants feel encouraged to report damp and mould.

Reactive

• Ensure that the accommodation is free from damp and mould and identify and address the underlying causes of any damp and mould problems.
• Respond to reports of damp and mould.
• In response to any report of damp and mould, inspect the home to assess the issue and identify and tackle the underlying causes of damp and mould with urgency.
• Inform the tenant about the steps that will be taken to remove any mould and address any underlying causes and the timeframes for the work.
• Prior to the removal of any mould, photograph, and document the location of the mould, to help identify the source.
• Remove any mould using a qualified professional when appropriate.
• Advise any tenant who is concerned about the symptoms they are experiencing to consult a healthcare professional.
• Inspect the home at least 6 weeks after any remedial work has been carried out, to ensure that the issue has been fixed and damp and mould have not reappeared. If damp and mould have reappeared, further investigation and intervention should be pursued.

Additional guidance covers:

• Processes to report and monitor damp and mould
• Property condition monitoring
• Guidance for individual landlords with a small number of properties and for housing providers
• Training internal staff and external contractors
• Collaborative working with other professionals for the social and private rented sectors
• Building relationships with tenants

External Checks

• damaged or blocked pipes, gutters or downpipes
• broken seals around windows or ill-fitting windows that do not close fully
• visible structural or facade defects, such as cracks in render or the foundation, missing or broken roof finishes
• bridged (compromised) damp proof course

Internal Checks

• peeling wallpaper
• visible damp or staining
• visible condensation
• defective plaster
• consistently high relative humidity, as assessed using a moisture meter or environmental monitors
• low levels of loft or wall insulation
• low internal wall temperature
• damaged, blocked, absent or switched off mechanical ventilation (for example, extractors in kitchens and bathrooms)
• ineffective or broken heating systems

Ventilation Checklist

• Do kitchens have ventilation systems (for example, extractor fans, cooker hoods) that are fully operational and sufficiently powered to remove moisture from cooking?
• Do bathrooms have ventilation systems (for example extractor fans) that are fully operational and sufficiently powered to remove moisture from showering and bathing?
• Do tenants know how to use ventilation systems and are they making use of them?
• Can windows be opened and are tenants making use of them?
• Do windows have trickle vents and are these kept open and free from blockages?
• Do tenants understand what they can do to improve ventilation and moisture control?
• Do tenants have access to secure spaces to dry laundry outdoors?
• Are roof and under floor spaces properly ventilated to ensure timber remains dry?

Heating checklist

• Is the home energy efficient?
• Is the heating system (including radiators) working effectively, sufficiently powered for the property and are tenants able to control it?
• Has the tenant been given clear, written instructions on how to use the heating system most effectively?
• Are the occupants struggling to heat their home?

In Dorrington Residential Limited v 56 Clifton Gardens Limited, Dorrington were the long leaseholder and 57 Clifton Gardens were the landlord.The long lease leaseholder had sub-tenants.

The landlord served the long leaseholders notice within the terms of the lease to inspect the property. The landlord was unable to get access and the long leaseholder was liable for the resulting breach.

Lesson Learnt

1.The long leaseholder is responsible for the covenants in the lease and they cannot be passed on to the sub-tenant.

2. Ensure notices are served in accordance with lease or s.196 Law of Property Act 1925