The unseasonal wet weather and flooding seen across the country throughout July acted as a stark reminder to some landlords that it is important they are prepared for if their tenanted property suddenly becomes uninhabitable.
As you are likely to be aware a landlord is under a general obligation to provide a property in a reasonable condition that the tenant can occupy. However, tenanted properties that are otherwise perfectly habitable can suddenly and unexpectedly become uninhabitable for a number of reasons including flooding, fire or structural failure. Whilst rare, where these instances do arise landlords can be placed in a very difficult position if they do not have the correct legal protection and insurance cover in place.
Ideally, landlords will have included a habitation clause in the residential tenancy agreement. This will state that rent, or a proportion thereof, will not be payable in the event the property becomes uninhabitable, unless of course the damage to the property was caused by the tenant themselves. A further clause should also be included giving either landlord or tenant the right to terminate the tenancy at short notice where it is envisioned the property will be uninhabitable for some length of time.
In addition to including these clauses, it is advised that landlords and their agents ensure adequate insurance cover is in place to cover such eventualities. Some policies will provide for loss of rental income while a property is affected, usually for a given period of time, as well as paying for affected tenants to be re-housed. With insurance premiums tax deductible it may be worthwhile paying a higher premium for greater protection, especially where rent is relied upon for mortgage repayments.
In relation to a landlord’s obligation to provide an affected tenant alternative accommodation, there are contradicting arguments. On the one hand the landlord has taken on the assumed responsibility to house the tenant for the period of the tenancy agreement. On the other, landlords cannot reasonably be deemed responsible for an unforeseeable ‘act of God’ taking place.
To overcome this grey area and protect both landlord and tenant, tenancy agreements should include a ‘force majeure’ clause which releases both parties from the contract in the event of an extreme occurrence that is out of the control of either party. In any event each case will need to be considered on its own merits taking into consideration the terms of the tenancy agreement, insurance cover in place and the local stock of alternative accommodation.