Lease or license?
A ruling by the Court of Appeal clarifies rules around the rights of property guardians. If you use guardians (or are a guardian) it could affect you. Let’s find out more.
In the recent case ‘G100 Limited v Maria Laleva [2021]’, the Court of Appeal states that a property guardian occupies the property they’re looking after as a licensee, not a tenant. Because they are a licensee, the licensor can obtain possession from the guardian without the licensee claiming the rights of a tenant paying rent. The Court’s view was that exclusive possession of a space alone is not enough to determine what is a license and what is a lease.
If you’re a landlord using guardians to look after your properties, or if it’s something you’re considering, this judgment could affect your interests. In this article, we’ll look in more depth at this verdict, what it means to you and how you can avoid legal entanglements if you use property guardians.
Background
In this case, Maria Laleva entered into a temporary license agreement with G100 (an agency supplying property guardians), paying a weekly fee to occupy a property as a guardian, performing the duties of a guardian.
As part of the agreement, Ms Laleva was given a set of keys and an allocated space on the property. However, when the property owner and the agency came to the end of their agreement, Ms Laleva claimed that because she paid a fee and had exclusive occupation of a lockable room, she had the same rights as a tenant with a tenancy agreement.
The Court of Appeal found against Ms Laleva, stating that sole use of a space is not the same as exclusive possession. Further to this, exclusive possession is not a conclusive way to determine whether a tenancy has been created. In this case, the sole reason Ms Laleva was in the property was to provide guardian services.
Using property guardians in the right way
If you have a vacant property, using a property guardian is a cost-effective way to keep your building in good condition, safe from squatters and vandals. Guardians provided by agencies will ensure that if anything happens to your property, you are informed straight away. The agency always vets them, although this can never guarantee that everything will go smoothly.
However, to avoid legal disputes like the one in this article, you need to go about it the right way. When you draw up the contracts for your guardian, make it extremely clear that you intend it to be a license agreement rather than a tenancy. Talk to your property solicitor to make sure everything is done correctly.
Find out more from Couchman Hanson
If you want to make sure your license agreement is correct, or just want to find out more, talk to Mike Brown at Couchman Hanson.
At Couchman Hanson, our solicitors genuinely care about getting the best outcome for you. We’re highly professional, with ‘city’ level talent and experience, but also friendly and welcoming. Everything we do fits with our values of integrity, honesty and authenticity.
Call 01428 774756 or visit couchmanhanson.co.uk