Cohabitation Rights

Cohabitation Rights

Cohabitation Rights
Posted on 7th April, 2021

Cohabitation is a term used to describe two people who are in a relationship with each other and are living together but who are not married. There is no such thing as a ‘common law marriage/relationship’. The legal rights of cohabiting couples are very different from those of married couples or civil partners. This is particularly relevant in relation to provisions for children, finances, and inheritance rights. Undoubtedly, these will always come to the fore if couples separate.

When people decide to set up home together, few think much about what will happen if their relationship ends or, sadly, if one of them dies. For married couples, the law is fairly clear-cut, but for people who cohabit things can become very problematic. You should consider the effect that living together has upon the following examples, for instance:

  • Owning a home together
  • Having children together
  • Impact of separation and rights to make financial claims
  • If you were to die without making a will

Buying a house 

It is possible to own property as “joint tenants” or “tenants in common”. If you own property as joint tenants, then this means that if one of you dies the property will automatically pass to the other person by way of survivorship. It is irrelevant what you have said in your will about that property. If you own the property as tenants in common (which will specify the shares in which you hold the property and may not be equal), then this means that your share of the property, whatever that may be, can be left under the terms of your will or by the rules of intestacy. Therefore, if you own the property as joint tenants and do not wish your spouse to inherit the property if you die, then it will be necessary to sever the joint tenancy of the property to change it to tenants in common.

If you intend to buy a property together, a Declaration of Trust allows you to state clearly what should happen regarding your property ownership and individual financial interests in that property. If you want to be sure of what will happen to a property if you were to split up, this document is unequivocal and can be relied upon to represent your respective considerations at the point of purchase.

Having children together

There are various considerations here, e.g.:

  • Parental responsibility
  • Financial support
  • Whose name the child should have
  • Child arrangements if you were to split up

In England and Wales, a father will automatically have parental responsibility over a child if they are named on the birth certificate or married to the mother. Parental Responsibility gives you the right to make decisions about a child’s upbringing.

If the father is not married to the mother and has not been named on the birth certificate, there are other ways to get parental responsibility. If the child’s mother, or anyone else with parental responsibility (like a grandparent), agrees to provide parental responsibility, it is possible to make a joint application to Court.

So, what legal protection is offered to cohabiting couples with dependent children? In short, there are no specific legal provisions for cohabiting couples when it comes to separation or one person’s death. When it comes to dividing the family home, this will fall to property law, and, where children are involved, the Children Act 1989 will need to be relied upon.

Neither of these areas of law will make provisions for the needs of the parents themselves and they will not take into account non-financial contributions that either person has made to the relationship (such as giving up work to raise the children). This means that one parent could find themselves destitute as a result of their separation.

Where there are children of that relationship, the only claim that a party has is for child support which is the money that a parent without day-to-day care of the children must pay to a parent with day-to-day care to assist with the maintenance of the child or children involved. This is calculated by the Child Maintenance Service, in accordance with a fixed formula.

This can be particularly worrying for a parent who does not own or have any rights in the property in which the family were living. This could be particularly concerning where that parent will continue to be the main carer for the children. This, again, is where the Children Act can play a role in addressing the financial needs of a child. It is possible to make Schedule 1 claims against the other parent so as to allow the Court to address some of the financial needs of dependent children. Please be aware that these needs are those of the child(ren) and not those of the parent.

In certain cases, the Court has the power to award the following:

  1. The transfer of a property. The housing needs of a child are met by transferring property (usually the former family home) to a parent until that child is an adult.
  2. Lump sum payments to cover capital expenditure. This is usually for items which depreciate such as cars, computers or, perhaps, to cover expenses already incurred.
  3. Periodical payments to address the costs of a child’s disability or school fees, or to provide top-up maintenance.

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The child can take either the mother’s or the father’s surname at birth. Both parties should think very carefully before agreeing which name the child should have as, once this is on the birth certificate, neither parent (with parental responsibility) will be unilaterally able to change that child’s name without the formal agreement of the other and, usually, a Court Order is required.

Child arrangements

It is important to note that both parents have just as much right to contact with their child as the other. This is not dependent upon the amount of child support paid. When two parents do not live together, or have separated, it is important to try and create a practical timetable when each parent can see the child.

Both parents can agree on this informally or, if this is not possible, a mediator can help you to reach an agreement – although a decision reached through mediation is not legally binding. If either parent does not stick to the agreed schedule, it may be possible to make an application to Court. This should be the last resort.

If you cannot reach an agreement about how often the children spend time with you or your former partner, you can make an application for the Court to decide. It is likely you will need to attend a mediation session before you can make the application.

Separation

Aside from potential issues arising with contact and the children, couples who are unmarried have no automatic entitlement to financial support from each other when they separate. Nor can they register home rights to prevent their partner from selling the house without having a legal interest in the property in their own right. This creates a great deal of uncertainty.

If the couple own a home together, there is no automatic right for the person with care of the child to remain in that property. Similarly, if you are an unmarried partner of a tenant (in private or social housing) then you will not usually have rights to stay in the accommodation if the tenant asks you to leave.

To avoid these issues, consider the Declaration of Trust as detailed above if you own property jointly. If in social housing, you could consider being joint tenants with equal rights and responsibilities.  If you are in private rental, then one person may remain and seek the tenancy in their own right but will have to repay to the other half any deposit that person has paid and be able to meet the monthly rent payments in their own right.

Death

In certain circumstances, cohabitees can benefit from the deceased partner’s pension. You need to have taken very clear advice from the Pension Provider and usually must be named on the Policy as a benefactor. There is no automatic right otherwise. It might also mean that the remaining partner is not entitled to the deceased’s partner’s life insurance policy unless specifically stipulated. Pension policies tend to differ dramatically, so if you are in a relationship and are not married to your partner then you should stipulate to whom your pension should be paid in the event of your death. For some pension schemes this can be relatively simple and done through an “expression of wishes form”. For other schemes this may not be possible, and you may need to seek legal advice on what to do. For life insurance policies, if you want your unmarried partner to be the recipient of a pay-out in the event of your death then they must be named in your policy as the recipient.

In addition to the above, it might be possible to bring a claim against the deceased person’s estate.  For instance, if you have children with the deceased, under the Inheritance (Provision for Family and Dependents) Act 1975 you may make a claim for financial support in respect to those living children.

In terms of the other assets of the deceased, a surviving partner will only inherit if this is stated in the deceased partner’s will. This can come as an extremely nasty surprise to some people who are already mourning following the loss of their loved one, sometimes after many years of living together, and are having to deal with everything else that follows a close bereavement.

This aside, as is the case when anybody passes away without leaving a will, the “rules of intestacy” apply. This means that the relatives of the person who has passed away will be the beneficiaries of their estate (even if they were not on speaking terms, had not seen each other for years or did not even know each other), and the surviving partner, who might have lived with the deceased for the last 50 years, receives nothing.

What can you do if you do not want to get married?

If a cohabiting couple does not want to get married but does want to put measures in place to legally protect themselves in the event of a separation, there are steps they can take. One option is to put a Cohabitation Agreement in place.

With a Cohabitation Agreement (also known as a Living Together Agreement), a couple can set out exactly how they will manage their money during the relationship, as well as what will happen in the event of their separation.

A Cohabitation Agreement will not interfere with any provisions made for children under the Children Act 1989, but it can help the couple to agree on how money matters should be dealt with between them.

A Cohabitation Agreement will not affect the will status and/or pension status as detailed above.

There is an awful lot to consider before you begin cohabiting and it is best to take advice as to how you can both protect your positions. If you would like to speak to someone, we are happy to help. Please call 01392 848911 to speak to one of our Family solicitors.

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This article was originally written by Moira Reynolds for the website MyBump2Baby.

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The Future of Farming & Rural Business

The Future of Farming & Rural Business

Rural economies throughout Europe, not just the UK, have been neglected politically for years, and the people living and working in them are angry and upset for having been ignored. From Brexit in the UK, the “Gilets Jaunes” movement in France and the Five Star government in Italy, to the growing tensions in Spain, Austria, Germany and Eastern Europe, the status quo has been rejected.

From the UK perspective, there will be change. That much is clear from the Agriculture Bill, Environment Bill and the Stacey Report, which sets out the direction of travel the government has in mind over the years to come.

It’s up to us, collectively, to fight these inequities (and many more besides) and force the government to listen and act. Everys created a series of podcasts with farmers, rural businesses, scientists and others, so that we can all learn more about each other’s businesses, share ideas and support what we all demand.

Making these podcasts has been both fun and informative. Everys is also supporting the Sustainable Food Trust where it can, particularly in its campaign to halt the decline of small, low throughput abattoirs. Its reports make the case for changes to farming that, by and large, we all support. The link to their website is set out below.

There are six podcasts for you to listen to:

  • Sally and Roger Maynard farm near Exeter. They describe how they diversified their farming operations over the years into, amongst other things, the outdoor toy business, and discuss the important business principles that they consider key to success.
  • John Coles describes how he diversified into the meat trade, establishing a low throughput abattoir on his farm. There were 200 when he started 40 years ago; only four remain. The rapid decline in the number of small abattoirs is putting the niche, high-quality livestock producer out of business.
  • Steve Williams and Pete Woodham-Kay started a charcuterie business just over four years ago in Steve’s garage. They now have an industrial unit full of equipment required to cure, using “only salt and natural Exe and Clyst Valley air”.
  • Andrew Parr is the fifth generation to run the family’s oak bark tannery business in East Devon – the last oak bark tannery in the whole country. At the beginning of the last century, Devon had 160 such tanneries. Andrew supplies top quality leather to the Northampton shoe industry, saddlers and the French and Italian fashion houses.
  • Professor Michael Lee runs Rothamsted Research at North Wyke near Okehampton and he cogently sets out the scientific case for both keeping red meat as part of our diet – although less of it – and for drinking more milk. Indeed, he believes that the decline in milk consumption is already having profound effects on our health.
  • Catherine Broomfield writes for the farming and national press about countryside matters and argues that the Agriculture Bill will only work if every element of it is implemented.

Sustainable Food Trust – https://sustainablefoodtrust.org/

What happens if I lose mental capacity and I have not made a lasting power of attorney?

What happens if I lose mental capacity and I have not made a lasting power of attorney?

What happens if I lose mental capacity and I have not made a lasting power of attorney?
Posted on 17th March, 2021

What do I mean by mental capacity?

Mental capacity is a complex subject but, at its most simplistic, it can be defined as our understanding of a given concept, situation, or predicament. It refers to our ability to be able to weigh up the pros and cons of a situation and make an informed decision. It is not black-and-white because very often it is not a case that one day we can make all our decisions and the next day we cannot make any. It is time and task-specific. This means that it depends on our understanding at a specific time, which is important if our capacity is fluctuating especially if we have good days and bad days, and it depends on what we need to understand about that specific decision we are being asked to make.

The important question that we should ask ourselves is who will make decisions for me if I cannot make them for myself? The starting point is always to check whether the person whose mental capacity is in question has done any planning for this possible eventuality by making a lasting power of attorney or if there was an old-fashioned enduring power of attorney in place.

There are two types of lasting powers of attorney:

  1. finance and property; and
  2. health and welfare

These are two very different and specific areas and you have to have both powers in place in order to make decisions in both categories.

If you have an enduring power of attorney in place you have covered the decisions that may need to be made on your behalf in relation to property and finance. However, they do not apply to welfare decisions.

Not everyone makes lasting powers of attorney and there are often various reasons why this is the case. In my experience, It can be because people are not aware that they can make powers of attorney. It can be because people think that this will impact upon their independence and don’t see it as a support tool. Sometimes the older we become the harder it is to make these decisions because we are nearer to the prospect of needing support. Some families have relationship difficulties with their children or between their children and so it makes it very difficult to decide who would be the appropriate person to be involved. In these circumstances, sometimes people choose not to make that decision because it’s easier to do that than run the risk of causing any more friction within the family. Some people do not have family and don’t know that they could ask a professional to do this for them.

If, for any reason, you or a loved one loses mental capacity, and you have not had the foresight to prepare for this situation, it is not the end of the road. There is an alternative that may offer some assistance. That is the Court of Protection.

What is the Court of Protection?

The Court of Protection is a special court that makes decisions on behalf of people who cannot make decisions for themselves. Someone could apply to the Court on your behalf and ask that they be appointed as a deputy to have the authority to make decisions on your behalf that you cannot make for yourself. That person would be referred to as a deputy.

There are two pathways for appointing a deputy. The first pathway is for property and finance which will involve stepping into your shoes and managing your affairs on your behalf in accordance with the powers conferred by the court in their order. It is very important to set out the powers that you will need when making your application.

The second pathway is for health and welfare. The Court is more reluctant to appoint a health and welfare deputy because it would prefer to deal with issues of welfare on a matter-by-matter basis. It recognises that to give someone a carte blanche ability to make welfare decisions for someone is to give them a lot of power over that person. However, the Court will look at appointing a health and welfare deputy where there are decisions that are going to need to be made about someone’s care, medical treatment, and place of residence. This will be particularly important if there are conflicting ideas as to what is the most appropriate way forward for the person who is unable to act for themselves.

The initial application to the Court is a paperwork application. The matter will only go before the Court if it is disputed. The outcome is the same as appointing an attorney but there are some extra protections for the named person. That being an insurance policy has to be put in place so that if the appointed deputy acts negligently, or if there is any impropriety, the named person will be put back into the position that they would have been in had the deputy not been appointed.

The deputy also has a duty to prepare an annual report to the Court giving an account both of the finances that have been spent in the current deputy year and any decisions that they have had to make on their behalf. The report also includes the people that the deputy has had to consult during that year.

The process for applying for a deputy does take longer than making lasting powers of attorney. In my experience, when a family is applying to the Court for an order it is because something needs to happen that cannot happen without it. This can be quite stressful for the family. It is also more expensive because you have to consider your solicitor’s fees, court fees, the cost of preparing a medical report, and the ongoing insurance costs. In most circumstances, these costs will come out of the named person’s estate.  However, if it is a disputed matter then not all costs may be allocated to the named person. That would be a matter for the Court to decide.

The plus side of a deputyship is that there is annual accountability scrutinised by the Office of the Public Guardian.

If you would like more information regarding making a Court of Protection application or making lasting powers of attorney, please contact me on jane.flaherty@everys.co.uk or 01404 541904.

 

 

 

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Preparing for your divorce appointment

Preparing for your divorce appointment

Preparing for your divorce appointment
Posted on 5th January, 2021

Preparing for your divorce appointment – what do I need to bring with me?

In order to assist clients with their initial divorce and finance appointments, I thought it useful to list some of the things that would be helpful for the solicitor to have at that first divorce appointment. This is not an exhaustive list because everyone’s circumstances are very individual but I hope it assists some in preparing for their divorce consultation. I am often told that there is apprehension around an initial divorce consultation and around what the divorce lawyer may ask or what documents are needed to start a divorce, so, hopefully, this will allay some concerns.

Correspondence

Those that have received correspondence from solicitors already, whether that be a draft divorce petition or a letter from the other party’s solicitors, it will be imperative that you provide this correspondence to the solicitor beforehand so that they can provide advice on the contents.

Details of the marriage

Full names of both parties, as detailed on the marriage certificate, would be helpful for your solicitor so that they have the details ready if they are instructed to draft a divorce petition. Further, if you have the marriage certificate, it would be helpful to provide this to your solicitor as it will be required to start your divorce petition. The date of the marriage is important so that the solicitor knows the length of the marriage when discussing financial settlement but also so that the solicitor has the date ready for the drafting of the petition.

In order to advise a client, the solicitor will need to know the date of the separation. The solicitor may also ask for information as to why you have separated. This can often be very sensitive and emotive but if you have the right solicitor for you, they will make you feel at ease with this and, certainly, if you instruct them, you will build a relationship with them throughout the divorce process. The solicitor requires this information to enable them to advise you on how to begin your divorce.

Assets

In order for a solicitor to advise, they will require information about your current assets and liabilities. It is important to go into your appointment with as much information as possible. However, sometimes there will be only very limited information that is known, and please do not feel you cannot have the appointment if this is the case. Your solicitor will advise you the best they can with the information they have.

Property – your solicitor will want to know the full addresses of all property owned by the parties either jointly or in sole names. If the property is owned jointly, a couple can own it as joint tenants or tenants in common. This is often something that people do not know so if this isn’t known, it can easily be obtained at a later date. The solicitor will want to know full details of the properties, i.e. when the property was bought, how much it was bought for, any recent valuation of the property, whether there is already any agreement on sale or transfer, mortgage details including the amount owed, the mortgage lender, if there is a fixed term etc. All of these details will assist the solicitor in providing advice.

Pensions – your solicitor will want to know whether either of you has any pensions and whether these were accumulated prior to the marriage, during the marriage or after separation. The solicitor will want to know the value of the pension which is also known as the cash equivalent transfer values (CETV). It is likely that you may not know this prior to your appointment but it will be something that you will need to obtain at some point during the divorce process, so it would be a good idea to obtain it as soon as you can. Further, if any of the pensions are in drawdown, information on the income received from these would be helpful.

Income – your solicitor will likely ask for details of all income received from employment / business / benefits / pension / child maintenance etc and, therefore, having these to hand for both parties would be helpful. Details of employers and length of service may also be beneficial, as well as any benefits received from employers such as bonuses.

Bank accounts / Savings / Shares – your solicitor will likely want to know of details of any joint / sole accounts, whether that be standard accounts or savings / ISA’s and the balances of those accounts. Information on any shares / life insurance policies would also be helpful.

Anything else – your solicitor may ask if there are any other assets that either of you has, over an amount of £500 as these may be included as part of any financial settlement, i.e. cars, jewellery, sports equipment etc.

Children

When discussing divorce and finances with your solicitor, they will want to know if there are any children between you or if there are any other children involved. Contact issues can often arise during separation so you may need advice on this, but also child maintenance is an important provision. The solicitor will likely ask for full names and dates of birth.

Conclusion

Your solicitor will not expect you to have all of this information, and, certainly, you will still be able to have your appointment and receive advice without it all. This is simply a guide to prepare you for the kinds of things your solicitor will ask you during the appointment and will likely ask you to obtain after the appointment if you instruct them. At Everys, your initial divorce consultation will enable your solicitor to get a snapshot of the relationship and the finances so they can advise you on the process, what will be required throughout, discuss any potential financial settlement and also provide advice on costs and time estimates.

At Everys we offer a fixed fee of £99 plus VAT initial appointment for all aspects of family law. These are currently being held remotely via telephone or Microsoft Teams with a solicitor. If you are interested in an appointment for some initial advice please do not hesitate to contact us.

UPDATE ON REMOTE SIGNING AND WITNESSING OF WILLS

UPDATE ON REMOTE SIGNING AND WITNESSING OF WILLS

UPDATE ON REMOTE SIGNING AND WITNESSING OF WILLS
Posted on 30th November, 2020

Update on remote signing and witnessing of wills

Following on from our recent article on remote signing and witnessing of wills, we want to offer an update now as a result of the new law being in place.

The technical bit

A change to the Wills Act 1837 has been brought about by Statutory Instrument. The change is made pursuant to s. 8 of the Electronic Communications Act 2000, which creates the power to modify other Acts so as to authorise the use of electronic communications for a wide variety of purposes, including anything that requires a witness (s.8(2)(c)).

The long-standing position has always been that two witnesses’ signatures must be made in the physical presence of the testator for the will to be valid. The new change to the legislation amends the definition of “presence” to include presence by means of videoconference or other visual transmission.

There is debate amongst practitioners and academics as to whether the old provisions already allowed for remote witnessing of wills, but the new legislation leaves us in no doubt.

The legislation is retrospective from 31st January 2020, which is the date of the first UK case of COVID19.  This will give some peace to those who felt their only option was to make a will remotely.

The legislation is time-limited until 31st January 2022, after which, without further legislation, the requirement for physical presence will return to the position prior to COVID 19. I would say that the jury is out as to whether this will remain a permanent way to make wills going forward.

It is important to note the retrospective element of the legislation does not apply to the following situations:

  • Where a Grant of Probate has already been issued in respect of the deceased person; and
  • Where the application for a grant is already in the process of being “administered”.

What are the practicalities of remote witnessing of wills?

Making a remote will is not an easy option and there are many drawbacks.

Guidance has been issued by the Ministry of Justice as to how this should take place as follows:

Signing by the party making the will 

  • All parties need to be on a video link, so you and your witnesses will need to be confident with the technology required to do this. The person making the will ensures that their two witnesses can see them, each other and their actions;
  • The signing will need to be recorded;
  • The will-maker should hold the front page of the will document up to the camera to show the witnesses, and then to turn to the page they will be signing and hold this up as well;
  • By law, the witnesses must see the will-maker (or someone signing at their direction, on their behalf) signing the will. Before signing, the will-maker should ensure that the witnesses can see them actually writing their signature on the will, not just their head and shoulders. This may make it difficult for the person making the will to be on their own as it could need the camera to be held at an angle to catch the image required to validate the will;
  • If the witnesses do not know the person making the will they should ask for confirmation of the person’s identity – such as a passport or driving licence;
  • The witnesses should confirm that they can see, hear (unless they have a hearing impairment), acknowledge and understand their role in witnessing the signing of a legal document. Ideally, they should be physically present with each other but if this is not possible, they must be present at the same time by way of a two or three-way video-link;
  • The will document should then be taken to the two witnesses for them to sign, ideally within 24 hours. It must be the same document. The longer this takes the greater potential for problems to arise; and
  • A will is fully validated only when testators (or someone at their direction) and both witnesses have signed it, and either been witnessed signing it or have acknowledged their signature to the testator. This means there is a risk that if the will-maker dies before the full process has taken place the partly completed will is not legally effective.

Witnessing of wills

The next stage is for the two witnesses to sign the will document – this will normally involve the person who has made the will seeing both the witnesses sign and acknowledge they have seen them sign. This will require a further recorded session.

  • Both parties (the witness and the will-maker) must be able to see and understand what is happening;
  • The witnesses should hold up the will to the will-maker to show them that they are signing it and should then sign it (again the will-maker should see them writing their names, not just see their heads and shoulders);
  • Alternatively, the witness should hold up the signed will so that the will-maker can clearly see the signature and confirm to the will-maker that it is their signature. They may wish to reiterate their intention, for example saying: “This is my signature, intended to give effect to my intention to make this will”; and
  • If the two witnesses are not physically present with each other when they sign then step four will need to take place twice, in both cases ensuring that the will-maker and the other witness can clearly see and follow what is happening. While it is not a legal requirement for the two witnesses to sign in the presence of each other, it is good practice.

Key points to note

  • This will take longer than making a normal will which may impact on the overall cost of a will, and runs a greater danger of someone dying before the completion of a will;
  • Problems may arise in relation to internet connection especially where people live more remotely; and
  • If the recording is not adequate to demonstrate the signing, the will may not be valid.

I would argue that if remote signing and witnessing of wills is to stay, then more work needs to be done to make this a practical and viable choice over the traditional way, and, in my opinion, the current procedure does not make it a viable option for clients.

Our Advice

  • Where possible, make a will in the traditional way: discuss your circumstances with your solicitor to see what can be done to facilitate this. Solicitors have thought of many ways to get wills signed, including drive-through and looking through the window, amongst other ideas. This will save time and money.
  • If you do have to make a will remotely, re-sign it in the normal way at the first opportunity you get as there are fewer risks with a traditionally signed will.

Should you have any questions regarding the making of a will please contact a member of our Private Client team on 0800 8840 640.

Code of Practice for Commercial Property Relationships during Covid-19

Code of Practice for Commercial Property Relationships during Covid-19

Code of Practice for Commercial Property Relationships during Covid-19
Posted on 20th November, 2020

The Government published the Code of Practice for commercial property relationships during the COVID-19 pandemic in June 2020.

The Code provides an interesting insight into the issues facing our sector from the Government’s perspective and should be reviewed carefully by landlords and tenants.

Key Points

The default position has to be that If tenants can pay their rent, they should do so. However, the Code looks at what can be done where the tenant cannot. Landlords and Tenants are encouraged to act in good faith and be open and flexible in negotiations.

There is a non-exhaustive list of points for Landlords to consider in negotiations:

  1. Closure period(s) impacting the tenant’s business, and ability to trade via other means;
  2. Duration and extent of restricted trading due to social distancing requirements;
  3. Extra costs and obligations through protecting customers to adhere to social distancing requirements;
  4. Needs of other stakeholders such as banks, employees, suppliers during this period;
  5. Government support received and how this has been used;
  6. The tenant’s previous track record under its lease terms and any concessions to the tenant already agreed;
  7. The impact that providing support may have on the tenant’s competitors and on other support already offered to tenants;
  8. Possible alternative considerations in a regulated sector. For example, pubs that are regulated under the Pubs Code.

The Government also tables a series of alternative arrangements for consideration. The Code is explicit that these are suggestions and not intended to be binding but it may be useful for both parties to consider whether one or more of the following would be appropriate:

  1. a full or partial rent-free period for a set number of payment periods;
  2. a deferral of the whole or part of the rent for one or more payment periods;
  3. the payment of the rents over shorter payment periods for a set time (e.g. monthly rather than quarterly) including provision for their payment in arrears;
  4. rental variations to reduce ongoing payments to a current market rate and/or to provide for all or part of the rent to be paid as a proportion of turnover of the site, incorporating any period during which the site was closed;
  5. landlords drawing from rent deposits on the understanding that the landlord will not then require that the deposits be “topped up” by the tenant before it is realistic and reasonable to do so;
  6. reductions in rent, either in whole or part, across other units occupied by the tenant and owned by the landlord, as part of a negotiated agreement applying to a portfolio of units;
  7. landlords waiving contractual default interest on unpaid rents or rents paid in arrears to make payment plans more affordable;
  8. provisions for ending the solutions on a fixed date, or on reaching the trigger point of particular circumstances;
  9. tenants and landlords agreeing to split the cost of the rent for any unoccupied period(s) between them;
  10. any of the above in return for other arrangements e.g. a reversionary lease on reasonable terms, the removal of a break right in favour of the tenant, or an extension of the lease.

The Code also contains guidance for dealing with service charges and insurance which again recognises that circumstances will vary and recommends flexibility. In many cases, inactivity and health and safety requirements have led to increased service charge costs via additional equipment, security and cleaning being required.

Next Steps 

Even though the points in the code are not expressed to be binding, it may be that any matters expressed within leases as being subject to the Landlord or Tenant acting reasonably are consequentially already influenced by this guidance. This may be particularly relevant to alienation provisions.

It is important at the moment to distinguish between guidance that the Government provides and legislation passed by Parliament. However, the concern for many Landlords (and advisors) will be whether these suggestions crystallise into legislation or more rigid guidelines in the coming months.

For further information, please contact James Cleveland or Jo Knight.