This briefing note is only intended as a general statement of the law and no action should be taken in reliance on it without specific legal advice.

REAL INSIGHTS - Property Update - November 2014
28 November 2014

REAL INSIGHTS - Property Update - November 2014


Mishcon de Reya was at the inaugural MIPIM UK in Olympia as a Gold Sponsor. As part of the programme, we co-hosted the latest in our series of Big Think debates on 'Shaping and Creating Great Places', part of a series of linked debates established by Mishcon de Reya and Central to examine the changing needs of our cities. In front of a MIPIM UK audience, Property Partner  Susan Freeman and our Head of Planning Daniel Farrand attended with a group of industry leaders including local authorities, property developers and senior opinion makers to discuss the issues around creating places people want to live and work in.

The debate, chaired by Patricia Brown of Central, highlighted some interesting issues, in particular how well as an industry we are communicating what we do in terms of creating places. Please click here for Susan Freeman's Estates Gazette Guest Blog on the debate.

Please click here to view the guest list.


The avalanche of regulation and legislation affecting the private-rented sector (PRS) market continues.  Following the note in our  September bulletin, here are three more issues to be aware of:

Immigration Checks

A pilot scheme starts in Birmingham and surrounding areas on 1 December. Landlords of residential dwellings, including those who take in lodgers or sub-let premises are required to ensure that the tenant / occupier is either a UK national, a national of an EEA member state, or has a right to remain in the country. Checks may be carried out online. Failure to comply could lead to a civil penalty of up to £3,000. The onus to carry out the checks can be passed to a letting agent but make sure it is clear who is to take responsibility for the checks. Further information can be found on the website

Residential agents joining redress schemes

From 1 October 2014, all lettings agents in England (only) dealing with private individuals and property managers dealing with residential premises must belong to a Government approved redress scheme. It does not apply to local authorities or in respect of social housing. Landlords or resident management companies managing their own properties will be excluded as they are not acting on instructions from a third party. There are currently only three approved redress schemes and local authorities can impose a fine of up to £5,000 for failure to join one. It is hoped that the ability to complain to a redress scheme will weed out unscrupulous agents. More information can be found on the website.

Tenancy deposit schemes - proper protection

Finally, old news but an important reminder on the topic of PRS to ensure that any deposit under an Assured Shorthold Tenancy is properly protected in an approved scheme and that the tenant is provided with all relevant information. Be aware, that where a tenant stays in occupation after the end of the original fixed term tenancy, this counts as a new tenancy. The deposit must be re-registered at that point and the information re-served. Failure to do so will render the landlord liable to a fine of up to three times the deposit and can mean that a section 21 notice cannot be served to terminate the tenancy without repayment of the full deposit to the tenant first. Legislation has been drafted to remedy the issue but there is no guarantee that it will be brought into force.

Alison Taylor is a Professional Support Lawyer in the Real Estate Department.


Residential landlords can breathe a sigh of relief following a decision by the Court of Appeal at the end of October. The case of Phillips v Francis considered when the statutory requirement for landlords to consult residential tenants over service charge expenditure is triggered. 

The High Court had previously ruled in 2012 that all service charge costs in a year must be aggregated, so any works which would result in the tenant paying more than £250 over the whole year would require consultation. This decision caused much concern amongst landlords, as it was contrary to the widely held understanding that the £250 limit applied to each "set" (or batch) of works. The High Court's aggregated approach caused real problems for landlords, as once the £250 limit had been reached, even minor works or emergency repairs would require consultation, or a dispensation from a tribunal, both of which would result in considerable delays and additional costs.

Thankfully, common sense has now been restored. The Court of Appeal has rejected the "aggregated approach" and agreed with the "sets approach" put forward by landlords. The court decided that the earlier decision had serious practical implications and could not have been what Parliament had intended.  Tenants already have a statutory right to challenge unreasonable expenditure, so they don't need additional protection under the consultation rules, which are there to ensure tenants aren't sent a large bill out of the blue for works to their building.

This decision is therefore good news for landlords, but also for tenants. Landlords won't be prevented from promptly carrying out emergency repairs and won't be passing on their additional costs of complying with unnecessary red tape to tenants. The court also gave guidance on when works should be treated as forming part of one "set", which will be helpful to landlords and managing agents as well as tenants.

Lucy Smith is a Professional Support Lawyer in the Real Estate Department.

news from the team

Mishcon de Reya launches construction blog

Mishcon de Reya's Construction Group is pleased to announce the launch of its new blog, Construction Matters. The Construction Group will use the blog to share its thoughts on the latest developments in Construction Law, with guest bloggers from across the industry also featured.

Commenting, Simon Hunter, Partner and Head of Construction, said:

"We will be contributing articles that provide useful information and voice our opinion on construction matters. Topics will be chosen for their relevance to the construction industry and we will aim to cover issues that are commercially relevant. We want Construction Matters to be a valuable tool for our clients and will be inviting them to shape the topics that we write about. We hope you enjoy the read."

If you would like to subscribe to Construction Matters to receive news and articles straight to your inbox, please click here.

Real Estate lawyers listed in Spears 500

In other news, Real Estate Partner Beverley Lewis and Consultant Ned El-Imad have been listed in Spear’s 500 as two of London's Best Property Lawyers.

Spear’s 500 is a comprehensive guide to every field that matters to HNWIs, from lawyers, private bankers, wealth managers and property consultants to the top art, philanthropy, wine and security advisers. Lawyers were selected for each category after being anonymously nominated by people in the industry.