Contracts

Q: Does a contract need to be written?

A: A contract can be a verbal or written agreement. It is better to have a written agreement as both parties know what is expected and it helps to avoid disputes.

Q: What if I’m not sure about what’s in a contract that’s been offered to me?

A: Do not sign a contract if you are not happy with the terms or there are any aspects of the agreement you do not understand. You should always be given at least 24 hours to read the contract through. Never sign on the spot. Once signed the contract is legally binding on all parties - you do not get a chance to change your mind.

Q: What sort of contract will I be offered and what should I look out for?

A: The type of contract you sign will depend on where you will be living:

In a house, flat or bedsit rented directly from a landlord/agent
In the home of a landlord to whom you pay rent (i.e. the landlord is also resident in the property)

If you’re planning on moving into a shared property, you need to be aware that your contract will make you responsible and accountable to your landlord in one of two ways (e.g. for rent arrears and damage to the property):

Renting from a landlord/agent

Most Landlords/agents use an Assured Shorthold Tenancy agreements. This usually is for a fixed term of 12 months, that is, it has a starting date and an end date. If you sign a fixed term contract you are liable to pay rent for the full period of the fixed term, unless there is a specific clause allowing you to give notice to quit (this is very rare). This type of agreement means that you are a tenant and have exclusive possession of the property. The landlord/agent can have access to the property (e.g. for repairs/inspections), but you should be given notice of any access required by your landlordand they should only call during reasonable hours which suit you.

Living in the same propert as your landlord

This can be a complex area and if problems occur you should seek advice. Normally, if you live with the owner of the property and share the accommodation, you will either be a licensee (if the owner of the property has unrestricted access to your room) or an excluded tenant (if you can lock your individual room(s). The length of the agreement will vary depending on whether the owner wants you to stay for a specified period of time, or if they are happy for you to stay on a periodic basis (e.g. month to month). You will have a bedroom and probably share the rest of the property with owner and possibly other tenants.

There is a standard agreement available which both owners and tenants can use which also acts as a useful checklist of issues that those living in an owner's house need to be clear about.

Joint liability

If you have signed the same contract as your housemates and you all agree to take the property at the same time, you will be jointly and severally liable with each of your housemates for any rent arrears and/or damage to the property. So, if one tenant moves out, the landlord/agent can pursue the remaining tenants (as well as the tenant who has left) for any monies due.

Individual liability

If you have a separate agreement between you and the landlord/agent, and another tenant leaves, the landlord/agent can not ask that you cover their rent. You would be liable for any damage to your room but not the room of any other tenant. The landlord/agent can make a charge for any damage to communal areas but they have to first try and find out who was responsible.

Q: What should I look out for in my contract

A: It is essential that you read through and fully understand all the terms and conditions stated on the contract. This includes any handbook or additional contract sheets you are given. If there is a dispute then the contract is the first point of reference and would be used as the main source of evidence in any court case.

The contract should include the full contact details of the landlord/agent. If you are renting via an agency make sure that you also have the landlords full contact details. You are legally entitled to this information. If you have just a name and telephone number it could be very difficult to pursue the landlord/agent should a dispute arise.

The contract should also make clear what rent payments are due and when. In addition to this it should be clear who is responsible for the bills e.g. water rates. Before you sign a contract, check that the advertised rent is what is stated on the contract. Errors do occur and if you sign the contract it may be difficult to argue later, especially if you do not have the original advert.

Once a contract has been signed the terms and conditions can not be altered unless both parties agree.

Never sign a contract on behalf of your housemates. Even if their name is on the contract, if they do not sign the agreement and decide not to move in, you could be held liable for the rent of the whole house.

Q: Can landlords write any terms and conditions they want into a contract?

A: No, they can’t. The Unfair Terms in Consumer Contracts Regulations (1999) applies to all rented tenancies. Any clauses deemed unfair could be unenforceable under the terms of these regulations. The regulations only refer to the standard terms of a contract (not clauses that have been separately negotiated). Examples of Unfair Terms could be penalty charges, exclusion by the landlord/agent of accepting responsibility for loss or damage to personal property and ambiguous legal clauses.

If you have any queries you can contact the Office of Fair Trading

Some common problems and questions

Q: I don’t get on with my housemates anymore and I want to move out – can I give the landlord/agent notice?

A: You must first check your contract. If there is a clause allowing you to give notice to quit then providing proper notice is given you could move out. If you have signed a fixed term agreement with no such clause then you remain liable for the rent and need to find a replacement tenant.

If you are housed by a larger supplier then you may be able to obtain a transfer to a different room in the same building or another part of their portfolio. This way there is no loss of income to the owner and you get to move away from the problem.

NB: if there is a serious household dispute and you feel forced to move out, seek advice before taking any action.

Q: We have signed a joint contract but one of our housemates has moved out. The landlord/agent is asking us for the money but we feel the tenant should pay, is this fair?

A: Fairness does not really come into it, The landlord/agent's primary concern is to collect the rent. If a joint contact has been signed the landlord/agent can decide whom they pursue for the rent. If the rent remains unpaid it can either be taken from the collective deposits or if court action is taken, the landlord/agent is likely to issue a summons that names all the tenants. The best option is to try and find a suitable replacement as soon as possible. Try using the noticeboard.

It is always worth checking that you have indeed signed a joint contract. Check through this link whether your contract meets the conditions for joint liability. If not, then the landlord/agent cannot make a claim for the rent arrears.

Q: I have moved out of a shared house but my former housemates are refusing to accept my replacement tenant. What can I do?

A: If the contract is joint and several the remaining household have the right to refuse a replacement tenant. However, they can only refuse on "reasonable" grounds. If they continue to refuse suitable replacements it is important to notify the landlord/agent. The landlord/agent may decide to take action against the remaining tenants if rent remains outstanding.

If you have an individual contract then you do not need to get the permission of others in the house. However, the landlord/agent does need to agree. It is rare that the landlord/agent refuses a replacement tenant and they would have to give good reasons for doing so.

Q: I have moved out of a shared house and found a replacement for my room, my housemates are happy with the replacement. What do I do next?

A: You need to contact the landlord/agent and see whether they will draw up a new contract to include your replacement. If they refuse, the next best thing is to sign an Assignment notice. This will state that you are leaving, who is replacing you and from what date. The notice needs to be signed by you, your replacement tenant, the landlord/agent and the remaining tenants. Normally this would secure your release from the contract and you can request your deposit back. However, some Assignment notices do include a section that states that you remain liable for the rent should your replacement fail to pay. This is legal and would mean that you have not been released from the contract.

Q: Our house is in a poor state of repair - can we move out?

A: It is very difficult to get out of a property on grounds of disrepair, unless the property lacks the basic facilities and services such as heating and running water, or your are in immediate danger. Disrepair is normally an issue of compensation rather than moving out. Seek advice before you take any steps to move out of the property.

Q: Can our landlord/agent evict us if he wants to?

A: All landlords must comply with the Protection from Eviction Act . Court action must be taken to remove you from the property/room. Under no circumstances can the locks be changed, access refused or your possessions removed. This would amount to an illegal eviction and you could sue for damages. However, if you live with an owner and are classed as an excluded tenant, your protection against eviction is more complicated and you will need to seek advice about your position.

If the housing provider (landlord/agent/private owner) wants you to leave early you must look at the terms of your contract. If you have a fixed-term agreement, possession will not normally be granted unless you are in breach of contract or the landlord/agent has stated in the contract that the property was recently their principal home (this is rare). There are set mandatory and discretionary grounds for eviction. Mandatory means that if the case is proven the court will have no option but to grant possession (e.g. eight weeks’ rent arrears). A discretionary ground can be proven but the court will then make a decision whether it is reasonable for possession to be granted (e.g. if the landlord/agent claims the property has not been looked after by the tenants and the condition of the property has been adversely affected.

Repossession by lender (Building Society/Bank) - A court may grant possession if the landlord has failed to make the mortgage payments. If the landlord has not informed the lender that they were renting the property out, the lender will not recognise you as tenants. As such they have the power to repossess the property with a court order. You can apply to the court for the order to be suspended for a short period of time, so that you can find alternative accommodation.

If you receive a notice of seeking possession or a possession order, or if you have any other queries or concerns please seek legal advice. Click here for details.