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Question Title: Council Property
| Question: 208 |
| I received instructions from a new client for a three bedroom ex-council house. After reassurances from my clients that there was no mortgage, I found tenants and entered into an assured shorthold tenancy agreement. After some time it transpires that the property is in fact still council owned and the client is not at liberty to let it. What would be the likely outcome of this situation be ?
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| Answer: |
| The tenancy agreement is void at law as the 'Landlord' had no title to the property. Therefore, the landlord, who is in fact the tenant, can be sued by the local authority for possession for breach of the tenancy agreement. There is normally a clause in local authority tenancy agreements which prevents assignment or subletting. The sub-tenants can sue the tenant for breach of warranty (the warranty being that she had the power to grant a tenancy) and claim damages. When the local authority obtains a possession order against the tenant, the sub-tenant will also have to leave. As agent, good practice dictates that assurances should not have been enough to satisfy you - you should have asked to see the latest mortgage statement, title deed or other similar paperwork. You can sue the tenant who was purporting to be the landlord for breach of warranty and recover damages.
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