Let me in! Let me in!26th October 2013
How many times have you exchanged contracts to sell a property, or been close to finalising the grant of a lease to a tenant, when you come under pressure from the buyer or the tenant to allow them early access, notwithstanding neither transaction has legally completed?
Buyers sometimes want to store furniture or commence redecoration/refurbishment. Tenants sometimes want to commence their fit out. But in all cases we would recommend resisting taking the “informal” approach and instead either refuse permission, or grant it subject to a formal licence to occupy being entered into in order that both parties’ rights and obligations are clearly set out.
On a property sale, permitting access can cause problems with the seller’s insurance or be a breach of the terms of mortgage conditions. The seller will also be left to pick up the pieces if the buyer subsequently fails to complete, having damaged the property or left goods or equipment in the property.
Lease negotiations also have a habit of suddenly taking on less urgency for the tenant when access is permitted before the lease is actually agreed and completed. Poor management of the situation thereafter can result in a tenant in occupation 6 months later with 1954 Act protection and no completed lease.
If the buyer or the tenant are in that much of a hurry, it is often the case that they will in fact simply legally complete the transaction more quickly which puts everyone in the position they should properly be in.