Tackling anti-social tenant behaviour in your contracts.
Learning from south Liverpool’s ongoing crisis
At first glance, it may seem that a Lodger (legally known as a Licensee) and Tenant are the same: a person renting a property from a Landlord. However, in reality they are quite different and their obligations and rights differ, as do the agreements they enter into. A Lodger will enter into a Licence Agreement and a Tenant will enter into a Tenancy Agreement - typically an Assured Shorthold Tenancy (AST) Agreement. You can view a tutorial of Legislate’s ASTs online.
The Tenancy Agreement grants the Tenant with a legal interest in land for a specific period of time, the Tenant will have control over the property for the duration of time specified in the Tenancy Agreement. Whereas a Licence grants permission for a person to occupy the property but does not confer a legal interest, in the absence of the Licence Agreement this person would be a trespasser.
For a person to be considered a Tenant and for the letting to be considered a Tenancy there are key elements that must be present. It is clear from the case of Street v Mountford that the essence of the Agreement determines whether a letting is a Tenancy (and not a Licence) rather than the label of the Agreement.
A Tenant has the right to exclude others (including the Landlord) from entering the premises without permission. The premises can be an entire property or just a single room in the property.
A Lodger does not have exclusive possession and is considered an excluded occupier. An excluded occupier is someone who shares the property with the homeowner (the Landlord). If the Agreement allows unrestricted access to the room or property, this would be a Licence Agreement.
In addition, in a Tenancy the letting is for a specific room/property and the Tenant cannot be moved to a different room/property. In a Licence Agreement, the Lodger can be required to move to a different room within the property.
Agreed Period of Time
This can be for a fixed period of time or periodic based on the rental period (i.e. week to week or month to month).
A Lodger can be given ‘reasonable notice’ to leave the property and as mentioned above, the Landlord can require the lodger to move to another room within the property. The Landlord must give at least 2 months’ notice in order to repossess the property if you are a Tenant.
Although this is not an essential ingredient for a Tenancy Agreement, it is very common as most Landlords will require the Tenant to provide a form of payment in return.
Whilst it might be tempting to label an Agreement a Licence due to the reduced obligations, it is important to understand that the agreement must have the features of a Licence or risk being treated by the courts as a Tenancy. Equally, a landlord must understand the consents they need to give before renting their property via a tenancy agreement.
Legislate enables Landlords to create licence and assured shorthold tenancy agreements which are fair, robust and tailored to their situations. To find out how, watch our demo and tutorials or alternatively book a call with us
The opinions on this page are for general information purposes only and do not constitute legal advice on which you should rely.
Learning from south Liverpool’s ongoing crisis
The services provided by a full management letting agency
On the 2nd anniversary of RoPA’s groundbreaking report
In law, is a landlord responsible for the actions of their agent?
The basic rights that both tenants and landlords are entitled to.
4 key stages in implementing a change of employment terms
Factors to consider before proposing a change to employment terms
How to read your tenancy agreement with student tenants
How can a landlord or letting agent end a tenancy without a section 8 or 21 notice?
For what reasons can you start the process of ending an assured shorthold tenancy?
Changing the terms of a tenancy agreement pre and post signature.
Everything to know about controlling Legionella risk in a rental property
If it looks, walks and talks like a tenant, can it be a lodger?
Are these 3 clauses in your free licence to occupy template?
What the case law says on the essential elements of a lease
Does a contract actually need to be in writing?
Your obligations before, during and whilst housing a lodger.
What the Electrical Safety Standards in the Private Rented Sector (England) Regulations 2020 mean for Landlords
A history of the landlord-tenant relationship and how it is shaped today
Don't cover up the cracks.
Make sure to remove these ‘unforgotten’ clauses from your contracts.
3 things missing in your agency’s template agreement with landlords
Bridges to cross when renting property.
Bridges every landlord needs to cross before letting their property.
Classifying property and your obligations.
Single occupancy, multiple obligations.
Landlords: Your extra responsibilities when letting a HMO.
Why your tenancy agreements might not be as enforceable as you think they are.