Where there’s a house share, some landlords choose a single joint and several tenancy and others choose individual tenancies on a room by room basis. There is no right or wrong way, and it’s a very personal choice. For a look at pros and cons for each option, please see this article.
As a general rule we prefer the joint and several method whereby a single tenancy is used for the whole property with multiple names on the tenancy. However, one of the drawbacks to that is if one or more joint tenant(s) wishes to move out and be replaced, what should the landlord do?
Our advice has always been that where there’s a change to joint tenants, a completely new tenancy from scratch is needed (as if all the tenants had vacated).
Where the tenants change, and it is known or accepted by the landlord without a new tenancy, it is a surrender of the original tenancy and re-grant to the new composition of tenants.
This was confirmed in Sturgiss & Anor v Boddy & Ors (2021) EW Misc 10 (CC), as HHJ Luba QC held (paras 67 – 69):
As to the extent to which a landlord needs to know – in advance – that joint tenant X is being replaced by joint tenant Y, Mr Jacob relied on Tower Hamlets v Ayinde  26 HLR 631. There, on markedly different facts, the Court of Appeal found that having been told that an outgoing tenant had departed and had installed a replacement, a landlord was thereafter fixed, by its conduct, with the new incumbent by surrender and re-grant. The short point is that the landlord’s acceptance of the new set up amounted to a completion of the process of surrender and re-grant even in circumstances where it had not known of the switch of occupiers when or before it took place.
Here, there was in place, as the landlord’s own evidence sets out, a prior arrangement that at the departure of one or more individuals the property would be treated as, in effect, re-let to those remaining and the new arrival(s). The arrangement did not require the landlord to participate in any way at the time or to be informed each time (although the Judge found he was). Given that this was a structure of the landlord’s own making he can hardly be heard to complain if the law gives effect to what has been agreed through the medium of surrender and re-grant.
As explained in QFS, the authorities on surrender are infused by the concept of estoppel i.e. the landlord who has acted consistently with the termination of a tenancy and the acceptance of a new tenancy cannot later resile. In the current context, it would be absurd to think that the landlord could insist that an individual who was a joint tenant before a ‘churn’, and had left after it, was still a tenant even though he was accepting rent he knew (or can be taken to have known) was being tendered on behalf of a new group.
In respect of deposits, it’s important when completing a change of tenant (by way of a new tenancy) that the deposit for the old group is returned and then re-protected under the new tenancy/group. In the above-mentioned case, the incoming tenants had been paying the outgoing tenants a proportion of the deposit for the whole tenancy. However, this was regarded (quite rightly) as the landlord receiving new deposits for each change in tenancy (referred to in the case as a ‘churn’) and the landlord was held liable for a deposit penalty in relation to each churn as the deposit was failed to be protected each time.
It seems to me that where the landlord has entered into a construct by which, at his own design, there is a single initial payment of a deposit and thereafter a churning in the identities of tenants, he must be treated as having been ‘paid’, by each new cohort, the amount held in respect of the original cohort and each subsequent cohort. The alternative is the very artificial notion that Mr Boddy is fixed with an indefinite liability to account to his original (and long gone) 2004 tenants for such sum as is left after proper deduction in respect of acts for which they are not responsible and have assumed no responsibility.
For a more detailed look at Sturgiss & Anor v Boddy & Ors, please see this NearlyLegal post.