Drafting Leases advice – Tenant’s property agreements

Most tenancy agreements stipulate obligations on the tenant to remove all of its goods at the end of the agreement. There is no guarantee, however, that the tenant will oblige in this. By leaving goods at the property, the landlord can inadvertently be put in a position he or she likely didn’t predict.

The biggest potential issue for landlords is that they could find themselves unintentionally becoming ‘bailee’ of the tenant’s goods. The Torts (Interference with Goods) Act 1977 (the ‘Act’) states that the landlord must take reasonable care of any uncollected consumer goods belonging to the tenant. As the goods are under the care and control of the landlord, the Act states that the landlord is considered as the bailee of the goods.

This potentially unfortunate situation can be avoided with careful planning and foresight with regards to drafting the lease. We would advise that landlords consider adding a clause to the agreement that deals with the procedures the landlord will take in the event of uncollected goods being left in the premises. Such a clause should also deal with the costs that would be borne by the landlord in handling these goods.

Of course, any such clause must adhere to the Act. In drafting this clause, we would advise that you include the following points:

  • Define the period in which the landlord may remove, store, sell or otherwise dispose of the goods if they are not collected by the tenant at the end of the tenancy.
  • State that the tenant will be responsible for all reasonable costs which the landlord may incur.
  • Make it clear that the landlord will be able to deduct any such costs from monies owed to the tenant.

After the sale of this property, any monies that are left after the deduction of the landlord’s reasonable costs are technically the property of the tenant for six years after the sale of the goods. It would be wise to keep the paperwork relating to the tenancy, the goods, the sale of the goods and the balance of monies until this six year period is ended as the tenant will be able to claim the return of their monies during this time.

Ask your Solicitor and Chartered Surveyor for advice if a new lease is being drafted. There are many other more substantial matters which also need consideration if you are drafting a new lease. Many Chartered Surveyors and Solicitors are fully trained in the nuances of property law and very sensibly, they usually work in tandem in providing advice on such matters.

Follow this link to find your nearest independently verified Chartered Surveyor.

02-12-11

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