Freehold and Leasehold Advice

If your tenant breaches a term (or terms) in their lease, you may be able to forfeit their lease agreement for Breach of Covenant.

A leasehold owner (technically a ‘tenant’) commits a breach of covenant when they breach one or more terms of their lease.

If the lease expressly reserves the right, a Breach of Covenant can lead to a lease’s forfeiture and the landlord regaining peaceful possession of the property.

Most flats and apartments in England and Wales are owned on a leasehold basis.

For leasehold property owners to lose ownership of their property in this way can be catastrophic —- and a significant commercial windfall for the freeholder.

In some cases, a Breach of Covenant can also lead to the Courts awarding damages to the landlord, which usually includes recovery of legal costs.

There are many potential Breaches of Covenant.

The detail depends on the content of the lease and the specific circumstances.

Some common examples of Breaches of Covenant by leaseholders include;

• Non-payment of ground rent
• Non-payment of service charges
• Unauthorized alterations to the property
• Allowing the property to fall into disrepair
• Unauthorized sub-letting of the property on a short-term AST basis
• Unauthorized sub-letting of the property and use as serviced accommodation such as Air BnB or Booking.com
• Unauthorised use — such as conducting commercial activities in the property without consent
• Causing or allowing nuisance or other anti-social behaviour in the property.

Technically, a leasehold property owner is legally a ‘tenant’, and various ‘landlord and tenant’ legislation applies.

Establishing a Breach of Covenant can — in the most serious cases — result in lease forfeiture by the freeholder, and in their favour, if the breaches of the lease are proven and not remedied after the landlord follows the proper process.

Helix Law regularly acts for landlords and freehold owners dealing with tenant disputes and Breaches of Covenant. We also routinely advise leasehold owners facing allegations by freeholders.

We have extensive experience in court proceedings, including in the County Court, High Court, and First Tier Tribunal (Property Chamber), litigating these types of issues and allegations.

Legal action concerning land-related claims — including those involving restrictive covenants — must be initiated within 12 years as stipulated by the Limitation Act 1980.

In practice, claims should be brought far more promptly.

For example, service charge arrears claims should be commenced within 18 months of the relevant expenditure item being incurred. This is commonly known and referred to as the ‘18 month rule’.

For certain breaches or potential breaches, seeking an injunction from the Court can be a necessary and appropriate step.

Taking the approach of seeking an injunction as a remedy is, by its very nature, serious and urgent. Delay alone can defeat an injunction.

Obtaining timely advice and actioning steps without delay is essential.

Restrictive covenants are covenants attached to land that can limit your ability to use or  develop the property.

If you have a dispute regarding the use of your property due to a restrictive covenant or easement (such as a right of way), Helix Law can help.

Restrictive covenants often seek to prevent freehold owners from extending their property or erecting additional structures like buildings or fences.

The law regarding restrictive covenants and easements is highly complex. Our expert team has significant experience representing land and property owners in proceedings where covenants are in issue.

Restrictive covenants are typically enforceable.

But enforceability can vary in various circumstances, including where the covenants have become obsolete and/or are no longer readily identifiable. Such situations can occur and evolve over time.

Enforceability often extends to issues like unauthorised property alterations or usage prohibitions detailed in leases, as well as in freehold deeds.

Enforcement may be challenged if the covenant’s terms are ambiguous or unclear, impacting the landlord’s ability to seek damages or repossession.

Obtaining expert advice on restrictive covenants is fundamental to avoid wasting time and incurring unnecessary costs.

We have successfully litigated disputes regarding easements and boundaries between adjacent land owners with assets worth millions of pounds at stake.

Disputes over property boundaries are incredibly common. An astute expert team can make a considerable difference in positioning you for success.

Whether a right of way exists, establishing such a right and/or forcing access can radically alter how the land can be used and, as such, the property value.

We have acted for varied parties, including private property owners and significant developers, where establishing rights of access and rights of way have commercially entirely altered and improved the viability and commercial success of our client’s land.

We often act in these disputes on a No Win, No Fee basis.

At Helix, we’re happy to back our own advice and participate in the upside of a positive outcome and success.

The landlord (also known as freeholder) or property owner who stands to benefit from enforcing a Breach of Covenant will typically initiate court proceedings to remedy a leaseholder’s or neighbouring freehold owner’s breach of the lease.

If litigation proceeds, the Court will decide whether to issue an injunction, award damages, and/or permit forfeiture of the lease.

Swiftly taking expert legal advice is essential if you believe that a tenant is in Breach of Covenant or has violated the terms of your lease.

We are instructed in property litigation across England and Wales and act for clients based across the UK and internationally.

We have an experienced team with strength in depth.

There are not many situations or disputes we have not seen in one form or another.

We often find this type of litigation starts small but rapidly escalates.

This is partly borne out of the personal and emotional nature of neighbouring or similarly connected property owners with competing interests, and/or that this type of issue and dispute will usually prevent a party from being able to remortgage, or sell.

Most mainstream lenders will not lend where there are boundary disputes, limiting the market for buyers — for example, to cash buyers only.)

Even well-advised cash buyers will seriously consider whether the risk vs reward dynamic is sufficiently attractive for them to proceed.

There is a considerable downside to purchasing land or property when the buyer must there spend time and money litigating to preserve or protect legal rights often considered a given.

Contact our expert property litigation team at Helix Law to find out how we can help. We aim to respond to all queries within an hour.