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Marcus Francis Avoiding accidental surrender
marcus.francis@fsp-law.com
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By Marcus Francis
May 2009
    

In the recent case of Artworld Financial Corporation v Safaryan the tenants of a very substantial London house complained about problems with the swimming pool and central heating, then moved out of the property and handed the keys back.
 
The landlord and its solicitors both made it clear in correspondence that the landlord regarded the lease as continuing, but the tenant failed to pay any further rent.
 
The landlord sued for unpaid rent, but the court held that the lease had terminated by what is known as a "surrender by operation of law".
 
The court held that the landlord's conduct had been inconsistent with the continuation of the lease as the landlord had re-decorated the house, parked its car in the drive, re-hung the curtains, returned some furniture and allowed a member of the landlord's family to move in.  Although not of concern individually, judged together these acts were treated as the landlord accepting that the lease had ended and the huge claim for future rent had to be dismissed.
 
If a tenant does vacate before the end of the lease term, there are various acts a landlord can take to protect its interests that do not amount to a surrender.  The landlord can accept the keys in order to gain access to the property, can enter to carry out repairs and can also seek to re-let the property. 
 
The boundary between the steps that a landlord can take and those which would amount to a surrender is not always clear and landlords are strongly advised to obtain legal advice when their tenants vacate their properties before the end of the lease term.

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