In an earlier blog, which can be viewed here, we considered some basic principles to take into consideration when considering undertaking alterations at your UK property (in this blog we are only considering an application for alterations and not notification to make improvements).
So, what happens next once the application for alterations has been submitted?
As the tenant, if the landlord is following good practice, you should be looking for the landlord to:
- have acknowledged your application within a reasonable period for example about five working days;
- confirm when acknowledging receipt of your application if they think any additional information is required or if they need more time to work out whether they need additional information;
- if they themselves are a tenant, pass the application to the superior landlord (if the terms of their lease require consent to be obtained for the proposed alterations);
- let you know their proposal regarding costs for reviewing, issuing a decision regarding the application and any costs in documenting the decision (formal licence for alterations). These costs should be reasonable and proper in the circumstances covering legal and any other costs they think they will incur in considering the application and will take into consideration, the complexity of the works, the value of the property, any additional third party consents which may be required, any other professional advice required. The landlord may refuse to look at the application in any detail until their costs are covered.
Does the landlord need to respond substantively on the application within a prescribed time scale?
- There is no statutory obligation on the landlord to respond to an application within a reasonable time scale.
- The lease itself may place a contractual obligation on the landlord to respond within a reasonable time scale.
- If the lease is silent on whether a landlord is to respond within a reasonable time, if the landlord is following good practice it should still respond within a reasonable time scale.
- If the landlord fails to respond within a reasonable time scale, it could be unreasonably withholding or delaying consent, which may have an impact upon any costs awarded if the application is referred to a dispute resolution process.
What should you expect when the landlord responds?
- The response should make it clear whether:
- consent in principle is being given;
- there are any conditions being imposed;
- consent is being refused.
- If consent is being refused, as the tenant it is reasonable to expect the landlord to be clear with you whether this is because:
- additional information is required and if so, detailing their further requirements; or
- if simply being refused, the reasons for the refusal.
If the landlord requests additional information, the request should be reasonable and detail all additional information required, and as the tenant you should aim to respond as soon as it is reasonable to do so (taking into consideration the nature of the request) and before any previously provided information may become outdated. Any requests for information and responses should as far as possible be dealt with in one request / package and not piecemeal.
If the landlord fails to provide reasons, at least in outline, which prevents a tenant from dealing with any objections / considering alternative solutions, the landlord's failure may be relevant in any proceedings to determine whether consent has been unreasonably refused and have an impact upon any costs being awarded.
What happens next if consent is granted in principle?
- It is common for any consent to be formerly documented in a licence for alterations (to carry out works), which annexes plans and specifications of the proposed works.
- As the tenant you should consider documenting the works photographically as well as entering into the licence, as this may assist in:
- determining on a future rent review what works are to be disregarded (assuming the works are to be disregarded on rent review);
- dealing with any reinstatement obligations at the end of the term;
- determining what compensation (if any) may be due to the tenant at the end of the term (for English / Welsh leases).
What can the tenant do if they believe an application for consent has been unreasonably withheld or delayed?
- If the parties agree, alternative dispute resolution (ADR) can be considered (and depending upon whether the lease prescribes a particular method of dispute resolution) may take the form of arbitration, expert determination, or mediation.
- If the parties disagree about the use of ADR, either party may refer the matter to court for determination. Unlike ADR, this is a public process; the general rule on costs is that the loser pays the winner's costs; and, only a court has enforcement powers such as executing a licence for alterations or other deeds in the event a party fails to comply with a judgment or order.
If you are considering alterations or have queries regarding any other matter, please do not hesitate to get in touch with our Real Estate team or your usual Brodies' contact.
