In this four-part blog, Icon Surveyors will consider firstly, what a ‘Licence for Alteration’ is? Secondly, when and why one might be legally obliged to obtain a ‘Licence for Alteration’? Thirdly, 'whether a Licence for Alteration can be refused by a landlord?' And finally, how to acquire a ‘Licence for Alteration’ and what might be included within it?
In Part 3, Icon Surveyors will consider 'Can a landlord refuse the licence to alter?'.
In Case You Missed Part 1 and Part 2 of the Licence for Alteration Guide
When can a Landlord Refuse the ‘Licence for Alteration’?
In the simplest of terms,
written consent or a ‘Licence for Alteration’ cannot be refused by a landlord unless the landlord’s reasons are reasonable or the landlord’s consent would cause the landlord to breach their obligations to other leaseholders.
Under section 19(2) of the Landlord & Tenant Act 1927, a landlord is given a statutory right to include a covenant prohibiting improvements without a licence or consent, in spite of any further provisions to the contrary, the landlord, must not withhold such consent unreasonably. However, the landlord is permitted to incorporate into a licence any reasonable conditions including the right to compensation for any damage to the landlord’s property together with any legal or other expenses properly incurred in connection with the licence or consent and/or a condition that the tenant undertakes to reinstate the property to its pre-alteration condition.
Everything You should Know About "Right to Compensation"
With regard to a tenant’s belief that a landlord is withholding consent unreasonably, a tenant may make an application to the court to determine whether or not a landlord has acted reasonably.
Section 19(3) Landlord & Tenant Act 1927, deals with, non-structural ‘Alterations’. The Act permits the landlord to prohibit alterations without a licence or consent on the proviso that such a licence or consent shall not incur on a tenant any sum payable by way of a fine or increase of rent. However, a landlord is legally entitled to any costs and/or damages that were incurred in connection with the licence or consent.
In relation to the reasonableness of a sum requested by a landlord, again, a tenant may make an application to a court to determine whether such costs and/or damages are reasonable? Once the court has ruled on this matter, a landlord is legally bound to grant a tenant a licence or consent on receipt of the determined payment.
However, in the recent Supreme Court case of, Duval v 11-13 Randolph Crescent Ltd UKSC18, the court concluded that a landlord who owned a property in which it had granted several leasehold tenancies is prohibited from granting a ‘Licence for Alterations’ to an individual leaseholder if all of the leases included a uniform clause that prohibited improvements or structural alterations. The court’s reasoning was simply that the landlord would be in breach of their obligations to enforce such clauses in the remaining leases unless s/he obtained the permission of all of the remaining leaseholders.
If after reading the terms of the lease a leaseholder is in doubt as to whether a landlord is able to consent to a ‘Licence for Alteration’, Icon Surveyors would always advise that a leaseholder refers the matter to a solicitor that specialises in leasehold matters.
Part four of this blog will provide the reader with detailed insight into the general running procedure of obtaining a ‘Licence for Alteration’.
Icon Surveyors are happy to provide a free consultation to any Leasehold or Freehold owners who may be affected by the subject matter raised in this blog.