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Your rights when subletting

By Simon Tye, Legal Adviser

This article originally appeared in News on the Block in July 2011

An Absolute prohibition on subletting is rare but can be found in some leases. If present, then it is hard to avoid. It is not a term that an individual leaseholder could apply to the “Appropriate Tribunal” to vary under section 35 of the Landlord & Tenant Act 1987.

In England the Appropriate Tribunal is the First tier Tribunal(Property Chamber) and in Wales it is the Leasehold Valuation Tribunal.

An absolute bar on subletting could be the subject of an application under section 37 of the 1987 Act, provided a substantial majority of the leaseholders are in favour of variation. The most common clause requires the leaseholder to obtain the freeholders consent to subletting (a qualified covenant). The clause may require the leaseholder to provide a copy of the tenancy agreement and covenants to be entered directly with the freeholder.

The clause may also say consent should not be unreasonably refused, but in any event the Landlord & Tenant Act 1927 section 19(1) provides that the landlords consent should not be unreasonably refused for subletting.

Also, where a written application is served on the person who may consent to the subletting they owe, pursuant to Section 1 of the Landlord & Tenant Act 1988 , a statutory duty to the leaseholder, within a reasonable time: –

The leaseholders remedies against unreasonably refused consent to subletting are as follows:-

Schedule 11 Part 1 of the Commonhold & Leasehold Reform Act 2002 defines an administration charge.

The lease may specifically refer to an administration charge being payable for the freeholder’s licence or consent. If not, the Landlord & Tenant Act 1927, section 19 allows the freeholder to “…require payment of a reasonable sum in respect of any legal or other expenses incurred in connection with such licence or consent..”

A variable administration charge, such as a fee for subletting, must be reasonable.

Any demand for an administration charge should be accompanied by a summary of leaseholders’ rights and obligations. There is a right to withhold payment if the summary is not provided.

LEASE is governed by a board, appointed as individuals by the Secretary of State for the Ministry of Housing, Communities & Local Government.

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