Every now and then the question arises as to what is the position if a rented house is destroyed or damaged by fire. The question will usually apply to damage by flooding or other disaster.
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Alternative Accommodation
One of the first questions that gets asked is whether a landlord is under a duty to re-house a tenant after a disaster such as fire or flood. The answer to this question is “no” but there is a further question that requires asking namely must the landlord “pay” for alternative accommodation? This is a totally different question but first let’s consider the duty to re-house.
Duty to provide alternative accommodation
As discussed above, there is no rule, act of Parliament or case law which provides in the event of a property rendered uninhabitable by some disaster that the landlord must start ringing round accommodation providers or hotels, arranging alternative accommodation and providing the details or keys to the tenant. It is submitted this is the case even if the landlord was at fault and somehow caused the fire.
However, the local authority does have such a duty.
A person is regarded as homeless if they have no accommodation available to occupy [s.175 Housing Act 1996]. A person is in priority need for accommodation if a person is homeless (or threatened with homelessness) as a result of an emergency such as flood, fire or other disaster [s.189(1)(d) Housing Act 1996]. Where a local authority has reason to believe a person is “homeless” and “in priority need for accommodation”, then, there is an interim duty to accommodate and as such they “… shall secure that accommodation is available for his occupation pending a decision as to the duty (if any)” [s.188(1) Housing Act 1996].
Cost of alternative accommodation
Whether the landlord must pay for the costs of re-housing a tenant albeit temporary will depend on whether the landlord is in breach of his repairing obligations or not and whether the fire was the landlords fault.
The landlord is not in breach of his covenant to repair until he has notice of the disrepair and a reasonable time has elapsed in which the repair could have been carried out (see O’Brien v Robinson [1973] A.C. 912). Therefore, if the fault was for example due to the electrics in the property but the landlord was not aware of any problem nor had the landlord received any notice of a defect, then, the landlord is unlikely to be liable for any damages to the tenant and therefore the landlord will not be liable to contribute towards the alternative accommodation.
If it is found the landlord was liable for the defect (perhaps by receiving notice of the defect and failing to act) and the tenant has found the defective condition of the premises to be intolerable and has reasonably taken alternative accommodation at reasonable cost, then the cost of this alternative accommodation will normally be recoverable from the landlord [Calabar Properties v Stitcher [1984] 1 W.L.R. 287, CA]
How badly the property has been damaged and whether alternative accommodation was reasonable and necessary will be down to the individual case in question and no strict set of rules will be able to answer that question.
Rent
Where rent is payable on a tenancy and there is no exception in the case of fire, then, the tenant remains bound to pay the rent even though the house is burnt down because the land remains and the parties were free to agree a contrary stipulation in the tenancy had the parties intended [Matthey v Curling [1922] 2 A.C. 180]. This rule applies even if the landlord has received the insurance money from insures [Lofft v Dennis (1859) 1 E. & E. 474] (authors note: I wouldn’t like to take this to the Supreme Court given the modern law!)
Insurance
In the vast majority of cases, there will be buildings insurance on the property and that will normally cover both the alternative accommodation and rent points. However, it again depends on the situation and terms of the tenancy as to what the insurance will pay out.
Where, as in most cases, the tenancy remains silent, then it is up to the tenant in essence what should happen. If the tenant wishes to have alternative accommodation paid for by the landlords insurer, that will normally be available under the policy. However, in this case, the tenant must continue to pay the rent for the destroyed house because that is (a) what the law provides (see above) and (b) it would be unfair if they didn’t because otherwise they would be living for a period entirely free of charge. Where alternative accommodation is paid in this manner, any loss of rent will not normally be paid to the landlord because of the tenants responsibility to continue to pay.
Alternatively, the tenant may wish to offer a surrender of the premises altogether and simply hand the keys back. The landlord is perfectly free to accept this surrender if they wish, in which case, the tenancy will end immediately and if the insurance has rent loss cover (something that often has to be specifically asked for) the insurers will pay loss of rent whilst the building is reinstated.
A further alternative is that the tenant may agree with the landlord that instead of paying the rent for the destroyed house, instead they will pay for the alternative accommodation themselves. In this situation, the insurers (again assuming cover) would pay the loss of rent and not the alternative accommodation costs.
This is not definitive because it is all dependant on the terms of the individual insurance policy and the terms of the tenancy but the key point is that rarely will insurance pay both alternative accommodation and rent loss. It will be for the landlord and tenant to agree which is to work best for them and in particular whether the tenant intends to return after the property is reinstated.
If the tenancy agreement provides that the landlord will insure the property but fails to do so, presumably he will have to cover any costs that the insurance would have paid had he not breached the tenancy and failed to insure.
Must the house be reinstated or rebuilt?
Again the question will often be answered by the lease. In particular long leases (greater than 21 years) will often have specific clauses in relation to rebuilding. For example a local authority right to buy lease on a flat within a building will have an implied term that the landlord will rebuild or reinstate the premises.
“There is an implied covenant that the landlord shall rebuild or reinstate the dwelling-house and the building in which it is situated in the case of destruction or damage by fire, tempest, flood or any other cause against the risk of which it is normal practice to insure.” [para 14(3) Schedule 6, Housing Act 1985]
For landlords in the private rented sector and most commonly assured shorthold tenancies, there is an implied covenant in every lease (less than 7 years) that the landlord shall repair the structure and exterior, installations for water, gas and electricity and sanitation, and the space heating [s.11(1) Landlord and Tenant Act 1985].
However, these repairing obligations do not require a landlord
“to rebuild or reinstate the premises in the case of destruction or damage by fire, or by tempest, flood or other inevitable accident” [s.11(2)(b) Landlord and Tenant Act 1985].
Therefore, subject to there not being a term of the tenancy to the contrary there is no requirement to rebuild.
In such a case and because the tenancy continues and normally rent continues to be payable, a tenant wishing to cease continuing to pay the rent should offer to surrender the tenancy or assuming the timing is appropriate (periodic tenancy) give a notice to quit.
A landlord wishing to end the tenancy would also need to serve an appropriate notice and if necessary obtain a possession order through the court if the tenant is unwilling to accept the tenancy at an end.
The appropriate notice would normally be a section 21 notice (or section 8 if the rent has not been paid). However assuming the tenant is not residing at the property due to it being destroyed or damaged, there is potential argument that the tenancy of the destroyed house has ceased to be an assured shorthold tenancy because it has ceased to be the tenants home. It is submitted as long as there is an intention to return that this won’t be the case because the condition is that the property is occupied as the tenants only or principle home. It is submitted that if they intend to return, although the alternative accommodation would be the home, it wouldn’t be the “principle” home and therefore even if no one is residing it is submitted it remains an AST. The type of notice and whether a notice to quit would be appropriate will depend on the individual circumstances though.
Frustration
“Frustration of a contract takes place where there supervenes an event (without default of either party and for which the contract makes no sufficient provision) which so significantly changes the nature (not merely the expense or onerousness) of the outstanding contractual rights and/or obligations from what the parties could reasonably have contemplated at the time of its execution that it would be unjust to hold them to the literal sense of its stipulations in the new circumstances; in such case the law declares both parties to be discharged from further performance” [National Carriers v Panalpina (Northern) [1981] A.C. 675]
It is well established that frustration can apply to a licence (as opposed to a tenancy) [Krell v Henry [1903] 2 K.B. 740.] It is also settled that frustration may apply to a tenancy that has taken effect although it will hardly ever do so [National Carriers v Panalpina (Northern)]
The reason it will hardly ever apply is because as we have discussed above, it is the “land” that is being rented not just the house that sits on the land therefore, whilst the land remains, so too in most cases will the contract which rented the land. Therefore, where the demised property consists of part of a building only (e.g. a flat within a block of flats), with no underlying land, destruction of the building may have the result of being frustrated. [para 7.143 Woodfall Landlord and Tenant].
It is also worth remembering that most tenants have some form of statutory protection when dealing with tenancies. If a contract were to be frustrated as a matter of course every time something unexpected happened, the tenant would loose this statutory protection at a time when this may not be suitable or in their interests.
Please contact me if you are a landlord or lawyer with practical experience of a FRUSTRATED TENANCY.
I am at present in this situation, with a mentally disturbed Assured tenant on housing benefit whose bedsit has been totally destroyed by fire.
All comments would be most welcome and will be acknowledged. O. P. M .
Need to know if the appliances are covered by landlords insurance asy flat flood last week and water hot in to freezer destroying all the meat
Is an assured tendency ‘frustrated’ if it is exclusive to a single person who dies within the term?
No, the tenancy continues and vests with the tenants estate and must be properly ended. See here for details about death of a tenant
If there was a fire in a rented home that was a result of a grease fire who is responsible for paying for damages. Is it the landlord? or the tenant?
I want to know how much it can be in that case of fire
My brothers flat has been burnt down due to a fire starting in a builders yard next to them. Most of the furniture is intact but he is classed as home less. What will be done to the furniture that is still in a half burnt property.
Ive had a fire caused by accident from a candle and dont have insurance my landlord does can you tell me what ive to pay as a tesult
I want to know if its right that when my house went in fire (gha house) by another tenent who lived in the close and i was already moving but did not get all my stuff out before this happend now the (gha housing ) are saying they cant replace anything from the house as we had time to get out stuff but i had a month to get my things any answers people or lawyers please dont think they should leave us with nothing
My two daughters have been renting a flat for a month and its above the landlords business the business had a fire and spread upstairs luckily they got out In time and now living back at my house as the flat is a mess my daughters have no insurance and all their contents are smoke damaged could they claim off the landlords insurance for contents
My house caught on fire due to electrical fault in the house but I lost everything due to smoke and fire damage is anyway I can get my things replaced if the landlord has homeowners insurance and if yes how do I go about doing this. Thank you
My two daughters are renters who just this weekend was flooded with a foot or more of water they are trying to work with the landlord who seems to think just replacement of the Carpet is enough of a repair job I have been in tje house and know in my heart of heart that that won’t work what can we do
The house where i used to live yesterday fired and i am out and sleeping in my car what i have to do \
You should speak with your local authority as they will be able to assist.
Are we responsible as landlord to pay for tenants house content if ever there was a fire or flood in our rental house
Hi
My rented accommodation was caught in fire and destroyed many parts of house and the carpets and curtains. 1st ,can I take the excess money from the tenants deposit 2nd can I take the money for replacement of curtains and blinds
My apartment building was only about 3 months old, it burned down the other night nearly taking me with it. I have lost everything. The fire was due to an electrical fault. I have been in hospital on oxygen and only have the jocks I am wearing and my phone. Everything else is gone. I have also paid a further month in advance for rent. The units are under a body corp. What happens here? Do they pay for the damage to my property, give rental money back or need to put me up in a motel until the apartment is repaired. I don’t really want to go back to the apartment , but have a year agreement and I am only 2 months into the agreement.
Hi my rented property caught fire due to a electrical fault with a light in garage.then caught on to the house everything was destroyed we left with nothing. I have two children we r now homesless.we had no insurance and he had no land lord insurance.he was in the process of buying this property from his parents.we are homeless living in the car and motels.can u tel me any info plz
My number is 0412 869 202
There was a fire at my rental house caused by a careless smoker a friend of the tenants. The tenants were away and friend was house sitting . Anyway half the back deck burned and some siding . How much notice must I give them to vacate . I’m from alberta
Please see our possession notice wizard which will determine the appropriate notice required.