Tenant paid for improvements

jimmii

I own a property with a long term Tennant who has paid for structural improvements from before my time mainly a new kitchen and some roof tiling. Who legally owns this now? Are they entitled to remove it if they decide to leave or because its physically part of the property then it stays? Its new lease time and they are looking to have a strange clause inserted whereby I have to agree to the things they have paid for being of no value to me and that they are entitled to remove them if they decide to leave.

How does this sound to you?

Graham

jimmii wrote: »

I own a property with a long term Tennant who has paid for structural improvements from before my time mainly a new kitchen and some roof tiling. Who legally owns this now? Are they entitled to remove it if they decide to leave or because its physically part of the property then it stays? Its new lease time and they are looking to have a strange clause inserted whereby I have to agree to the things they have paid for being of no value to me and that they are entitled to remove them if they decide to leave.

How does this sound to you?

WTF, that sounds completely nuts. Unless there was something to that effect in the lease when the work was done I'd be politely declining.

How would the tenant react if you asked him to reinstate the property to the exact condition it was in prior to his alterations.

jimmii

Graham wrote: »

WTF, that sounds completely nuts. Unless there was something to that effect in the lease when the work was done I'd be politely declining.

How would the tenant react if you asked him to reinstate the property to the exact condition it was in prior to his alterations.

I know it's crazy alright not sure how it came about. Those were my thoughts too feel free to take the kitchen as long as you return the property to the state it was when you moved in!

The agent even said my original offer was more than generous they were surprises how the Tennant came back with this. I was trying to reasonable to try get the new lease sorted as soon as possible as we're both self employed so time is in short enough supply as it is!!

Graham

jimmii wrote: »

I know it's crazy alright not sure how it came about. Those were my thoughts too feel free to take the kitchen as long as you return the property to the state it was when you moved in!

The agent even said my original offer was more than generous they were surprises how the Tennant came back with this. I was trying to reasonable to try get the new lease sorted as soon as possible as we're both self employed so time is in short enough supply as it is!!

I'd seriously go and get some legal advice here. If you're in the process of drawing up a new lease you really need to make sure it clarifies your position. Make sure the tenant is not under the illusion he can walk away in 12 months time with your kitchen and roof.

That sort of thing that would make you think twice about renewing the lease at all.

jimmii

Graham wrote: »

I'd seriously go and get some legal advice here. If you're in the process of drawing up a new lease you really need to make sure it clarifies your position. Make sure the tenant is not under the illusion he can walk away in 12 months time with your kitchen and roof.

That sort of thing that would make you think twice about renewing the lease at all.

It certainly does seem like no lease may be better than that lease!

Just trying to get as many views as possible before going further thanks for your input.

garhjw

Very strange situation Op and I can't see hobbit can be workable within the lease. As others advised, you need to run it by a solicitor.

Gatling

Did you buy the property with the sitting tenant

jimmii

garhjw wrote: »

Very strange situation Op and I can't see hobbit can be workable within the lease. As others advised, you need to run it by a solicitor.

It certainly is a weird one. The agents I use are a solicitors too so at least they should be able to understand the situation a little quicker!

Mrs OBumble

Hmm, imagine you had a clause like the tenant suggests. And then the tenant stays for another 10 years and the kitchen stuff wears out.

Who's responsible for paying for the replacements then? The owner of the stuff (which is likely higher quality than what a LL would provide)? Or the property owner?

Unless there's a reason to make a new lease, then I wouldn't.

jester77

Are they foreign?

That is very normal here in Germany, property must be returned to the state it was received in and if you changed anything you normally offer the landlord the option to pay for the changes and they can accept or decline the offer. If they accept then the changes would be valued at the costs at the time minus depreciation.

jimmii

Gatling wrote: »

Did you buy the property with the sitting tenant

Yeh they have been there for 20+ years or something. I met them at the time and they just wanted reassurances that nothing would change which I have done my best to ensure to date and any time they have reported faults I have always had them fixed as soon as possible bit of a surprise for this to suddenly crop up!

jimmii

Mrs OBumble wrote: »

Hmm, imagine you had a clause like the tenant suggests. And then the tenant stays for another 10 years and the kitchen stuff wears out.

Who's responsible for paying for the replacements then? The owner of the stuff (which is likely higher quality than what a LL would provide)? Or the property owner?

Unless there's a reason to make a new lease, then I wouldn't.

They want to have a lease in place which I am happy to do as there will be a rent increase written into it. I don't know the condition of the kitchen previously but they have said that it wasn't one they were happy with basically!

jimmii

jester77 wrote: »

Are they foreign?

That is very normal here in Germany, property must be returned to the state it was received in and if you changed anything you normally offer the landlord the option to pay for the changes and they can accept or decline the offer. If they accept then the changes would be valued at the costs at the time minus depreciation.

This is how I would think it would be dealt with too. I have contacted the agent for them to look into previous leases and who owns what legally so will have to wait and see what comes back! Way I see it when they moved in there was a kitchen so when they leave there should be a kitchen whether it be the one there now or they put another one in when they take this one.

listermint

Technically speaking all this should have been squared away prior to you purchasing the property. Thats on you and the original vendor.

The only way out of this is to negotiate an amicable solution for both parties. That could be indeed reduced rent in lieu of ownership of the upgrades for a certain period of time. Or some other incentive.

I think a sit down with the tenant is your best possible approach right now.

3DataModem

jimmii wrote: »

I own a property with a long term Tennant who has paid for structural improvements from before my time mainly a new kitchen and some roof tiling. Who legally owns this now? Are they entitled to remove it if they decide to leave or because its physically part of the property then it stays? Its new lease time and they are looking to have a strange clause inserted whereby I have to agree to the things they have paid for being of no value to me and that they are entitled to remove them if they decide to leave.

How does this sound to you?

What was included in your purchase contract / deed?

listermint

jimmii wrote: »

This is how I would think it would be dealt with too. I have contacted the agent for them to look into previous leases and who owns what legally so will have to wait and see what comes back! Way I see it when they moved in there was a kitchen so when they leave there should be a kitchen whether it be the one there now or they put another one in when they take this one.

That may not have been the agreement with previous owner. So it doesnt matter what thoughts you have on it realistically.

Should have been resolved during sale.

KCross

Im no legal expert but surely a kitchen and roof is "fixtures and fittings" which the tenant has no right to take with them unless specifically agreed in writing somehwere.

Also, when you bought the house you would have become the owner of the tenants new kitchen units, unless something to the contrary was agreed in writing.

Maybe as a compromise you could potentially agree to the clause for anything they add from this point forward that you jointly agree to, but certainly not for undocumented items in the past.

jimmii

listermint wrote: »

That may not have been the agreement with previous owner. So it doesnt matter what thoughts you have on it realistically.

Should have been resolved during sale.

It wasn't something they mentioned at the time and neither I or the agent was aware of it seems it was either agreed with the old landlord without going via the agent or they just did it without asking.

jimmii

KCross wrote: »

Im no legal expert but surely a kitchen and roof is "fixtures and fittings" which the tenant has no right to take with them unless specifically agreed in writing somehwere.

Also, when you bought the house you would have become the owner of the tenants new kitchen units, unless something to the contrary was agreed in writing.

Maybe as a compromise you could potentially agree to the clause for anything they add from this point forward that you jointly agree to, but certainly not for undocumented items in the past.

That's how I saw it too it came as a bit of a surprise when they brought it up! The old leases are being gone through in more detail now to see if there is any reference to it in the past (nothing in the last lease) so we'll see what can be dug up.

I am expecting to pay for any further repairs or replacements quite a bit has already been done in the last year or so! The boiler went just before Christmas in 2013 that was a fun one to try get sorted Christmas week!

kidneyfan

Are these people not sitting tenants?

irelandrover

Would it not be up to the tenant to prove that they own the items before they can remove them? Just because they paid for them does not mean that they own them. Maybe did damage to the previous ones and that is why they paid?

Michael D Not Higgins

irelandrover wrote: »

Would it not be up to the tenant to prove that they own the items before they can remove them? Just because they paid for them does not mean that they own them. Maybe did damage to the previous ones and that is why they paid?

Or were already reimbursed by the old landlord, or agreed a reduced rent in exchange, etc.

There's a number of different ways this could have played out and no indication of any documentation to back it up.

MouseTail

I can see their POV, that has been their home for years and years, they may have invested quite a bit in the new kitchen and now be worried you will sell after a year, turf them out and keep the kitchen. A little bit of compromise here is the answer i think.

Baby01032012

I would not put a lease in place with these tenants. The RTA gives part IV tenancies ( which this would be )enough protection. Or put in place a standard lease. If they refuse to sign they will have to accept part IV or move.

However legal advice should be sought.

Del2005

jimmii wrote: »

It certainly is a weird one. The agents I use are a solicitors too so at least they should be able to understand the situation a little quicker!

For the sake of few Euro I'd go see a different solicitor, can't be a good idea for the EA to also act as a solicitor when they have an interest, to make sure you're getting unbiased advice.

the_syco

jimmii wrote: »

The agents I use are a solicitors

Conflicting interests, and unless you paid for their advice, they may deny knowing if sh|t hit the fan.

The Spider

Tenants could produce receipts for the kitchen and any work paid for by them, in fact if I was them I'd make sure I had said receipts, and if all was paid for by credit card you have zero wiggle room here.

Irregardless of what was there before it doesn't matter, what matters is that you bought the current property with a tenants kitchen in place.

I had a neighbour years ago who put down wooden floors in her house with the landlords approval for reduced rent, she was a single mother and all that, landlord tried to get her out at a later date, however the court found in her favour and she had to be compensated for all work carried out.

You're looking at a similar situation.

seventeen sheep

The Spider wrote: »

Tenants could produce receipts for the kitchen and any work paid for by them, in fact if I was them I'd make sure I had said receipts, and if all was paid for by credit card you have zero wiggle room here.

Irregardless of what was there before it doesn't matter, what matters is that you bought the current property with a tenants kitchen in place.

I had a neighbour years ago who put down wooden floors in her house with the landlords approval for reduced rent, she was a single mother and all that, landlord tried to get her out at a later date, however the court found in her favour and she had to be compensated for all work carried out.

You're looking at a similar situation.

The crucial difference being the fact that this is not the same landlord who was there when the work was carried out.

The OP purchased the house at a price agreed based on the condition of the house as it was at that date. If the improvements meant that the selling price of the house was higher than it would otherwise have been, the tenants should have followed it up with the old landlord at the time, as he is the one who benefitted financially from the improvements. Why should the current landlord be at a loss?

I think you should explain to them that you now own the house, as it is, improvements and all. They do not have any claim over the work done anymore (you could go in and replace the kitchen tomorrow if you wanted - it's your house.) If they feel they should be reimbursed in any way for the improvements, it's entirely between them and the old landlord, and nothing to do with you. And make it clear that they do not have permission to make "improvements" in the future without consulting you first.

seventeen sheep

MouseTail wrote: »

I can see their POV, that has been their home for years and years, they may have invested quite a bit in the new kitchen and now be worried you will sell after a year, turf them out and keep the kitchen. A little bit of compromise here is the answer i think.

And so what if he did? He owns the kitchen, along with the rest of the house. The tenants were feckin eejits to spend so much money on someone else's house. The OP shouldn't have to compromise because of their stupidity.