The recently reported case of Mann Aviation v Longmint Aviation serves as a useful reminder of how easily a periodic tenancy can arise (with the result that protection under Part II of the Landlord & Tenant Act 1954 (“the 1954 Act”) is acquired) where a tenant is allowed into occupation of a property without a formal lease being put in place.
In the Mann Aviation case the occupational tenant had physical control of a property and paid an annual rent. The owner of the freehold of the property was deemed, by the Court, to have accepted that the tenant had exclusive possession and consequently held that an annual periodic tenancy had been created.
To determine the periodic tenancy (a species of tenancy which is incapable of being contracted out of the 1954 Act) 6 months notice expiring at the end of a period of the tenancy had to be given and, in addition, one of the grounds set out in the 1954 Act had to be satisfied. The termination notice given by Longmint to determine Mann’s right of occupation (Longmint having alleged that Mann were merely a licensee) was therefore ineffective and Mann Aviation were entitled to remain in occupation.
This case highlights the very real risks of allowing a party to occupy a property without a clear contractual agreement (contracted out of part II of the 1954 Act if necessary) governing that occupation. A simple and short form lease could have been put in place quite easily (and at little expense) to avoid this situation arising. The risks (and costs) which flowed from failing to do so, are clear.
If you wish to discuss any points raised in this blog please contact Mark Withers at mark.withers@parissmith.co.uk.