The tenancy agreement

Tenancy agreements are composed of a number of different elements.

This content applies to Scotland

Content of tenancy agreement

Tenancy agreements can be in writing or they can be 'verbal'. Just because a tenant has no written lease does not mean that there is no actual lease. Verbal agreements are as legally binding as written ones, and can provide more rights for the tenant, as any gaps in the verbal lease will be filled in by the provisions of the Private Housing (Tenancies) (Scotland) Act 2016. The problem with verbal leases is proving what their terms are in the event of a dispute, so a witness to the discussion over rent/duration etc. is useful. It should be noted that tenants are entitled to a written lease [1] and that in the event of a dispute a tribunal may decide what terms had been agreed.

Lease agreements should contain details of:

  • the parties, ie the name of the landlord and the name of the tenant

  • the subjects of the lease, ie the address

  • the amount of rent to be paid

  • how long the lease is for.

If there is no agreement on these points then it may be that there is no lease, although the duration of the lease can be implied by the actings of the parties.

For example, in the case of Mann v Houston, [2] the owner of a garage agreed to let the garage out for a single payment of £200. The agreement between the parties stated that the lease would be for a period of ten years and gave a start date of 28 May 1951. The agreement further said that there would be no further rental payments although the tenant would be responsible for certain charges and maintenance costs. Notably, the fact that no further rent was payable was an express provision in the agreement. Furthermore, the agreement also said that the tenant could terminate the contract and that the owner would pay an annual sum back to the tenant if that happened.

The owner then sold the garage to a purchaser while the tenancy agreement was still in place. The purchaser knew about the agreement with the tenant. The legal documents pertaining to the sale of the garage contained a clause which excepted existing leases and the tenant's rights of possession from the sale. The purchaser of the garage raised an action of ejection against the tenant.

The court decided that the agreement between the tenant and the original owner did not form a lease because it did not make any provision for the payment of rent. The person who was using the garage merely had had a personal right of occupancy which did not apply when the garage was sold. The court also decided that it did not matter that the purchaser knew about the existence of the agreement and, therefore, was not barred from raising the court proceedings.

Details to check

Before a tenant signs a lease s/he should read the agreement carefully and check:

  • what type of tenancy is being offered [3]

  • the amount of rent payable, when it's payable and how it's to be paid, for example, if the rent is to be paid by standing order, or does the tenant have a bank account

  • whether the rent covers services (such as gas and electricity) or are these extra, and who is responsible for Council Tax (usually the tenant, unless there is a resident landlord) [4]

  • the amount of deposit to be paid and in what circumstances it will not be returned (it should be noted that premiums are unlawful) [5]

  • what the tenant's obligations are to repair and decorate the property

  • any other obligations and rights of the landlord and/or tenant.

The provisions regarding the termination of the tenancy may also be included. Landlords frequently insert a clause to the effect that if the rent is x days late then the tenant is in breach of the agreement and has to leave when told to do so. This is simply a scare tactic. Non-payment of rent is a ground for eviction [6] but the landlord would still have to obtain an eviction order in order for her/him to evict the tenant. To evict a tenant otherwise would be illegal. For more information, please see the section on harassment and antisocial behaviour.

However there will be circumstances where it would be useful for the tenant to be able to end the tenancy with, for example, four weeks' notice. Indeed, tenants should be advised that termination on their notice is a requirement of a fair lease. This is useful for short assured tenants, since if there is no provision entitling the tenant to leave before the end of the tenancy, the tenant may be liable for rent loss suffered by the landlord should s/he leave the property before the end of the lease.

Tenancy agreements frequently claim to limit or exclude rights given to tenants by Acts of Parliament. This is particularly found in provisions relating to repair. However, tenancy agreements cannot legally do this. The provisions of the Housing (Scotland) Acts 1987 and 1988, relating to the duty of the landlord to provide and maintain the property in a tenantable and habitable condition, cannot be excluded by the lease. [7]

Inventory

In addition to the tenancy agreement, tenants should agree with the landlord an inventory of all furniture, crockery, linen etc. that has been provided by the landlord. Note should also be taken of the condition of the items so that a later dispute over damage or disrepair to the property may be avoided. A witness or photographs may prove useful evidence to the actual state of the furnishings and fittings at the start of the tenancy.

Who is the landlord

Private sector tenants have a legal right to know the name and address of their landlord and this information should be within the lease. If the name and address of the landlord is not on the lease, then the tenant can make a request in writing, for example, to the agent acting for the landlord, for this information. This request for the landlord's name and address has to been answered within 21 days. [8]

It should also be noted that the landlord’s address has to be a place of abode or a place of business [9] and cannot be a PO Box type address.

Last updated: 4 December 2019

Footnotes

  • [1]

    s.30 Housing (Scotland) Act 1988

  • [2]

    Mann v Houston 1957 SLT 89

  • [3]

    If a short assured tenancy, has Form AT5 been properly served on the prospective tenant?

  • [4]

    s.75(2) Local Government Finance Act 1992

  • [5]

    s.27 Housing (Scotland) Act 1988

  • [6]

    ss.18-20 and Sch. 5, Grounds 8, 11 and 12 Housing (Scotland) Act 1988

  • [7]

    s.13 and Sch. 10 Housing (Scotland) Act 1987

  • [8]

    s.327(1) Housing (Scotland) Act 1987

  • [9]

    s.327(3) Housing (Scotland) Act 1987