It may sound trite to suggest that the situation on the ground should always be reflected in the legal documentation, but the recent Sheriff Court case of Comhairle Nan Eilean Siar v Paul Collins serves as a timely reminder always to put things in writing.
Who was the legal tenant?
Comhairle Nan Eilean Siar owned Barvas Industrial Estate on the Isle of Lewis and let two units to Mr Collins in 2002, with an expiry date in April 2007. Mr Collins subsequently assigned his interest as tenant under the lease to Xaverian Missionaries in 2003 by way of a written assignation, formally consented to by Comhairle as landlords. Xaverian employed Mr Collins in connection with a project to restore Land Rovers, for use in Africa. When this project ended in 2005, Mr Collins continued to occupy the units, with Xaverian's permission.
Around March 2006, Comhairle became aware that the units were in a poor state of repair. Vehicle shells were being dumped around the industrial estate and other tenants were complaining about the mess, which was restricting access into their own units. As a result, Comhairle wrote to Xaverian to advise them that they were in material breach of their obligations under the lease and Xaverian responded, agreeing to a termination of the lease. Comhairle and Xaverian agreed a termination date of 30 June 2006 and they both wrote separately to Mr Collins advising him of the termination and requesting that he remove himself and his personal belongings from the premises. When Mr Collins failed to vacate the units, Comhairle raised court proceedings seeking confirmation from the court on three fronts:-
# that Mr Collins had no right, title or interest to occupy the units;
# that he should therefore remove himself from the property; and
# that he should be interdicted from occupying the units or storing property on any part of the industrial estate.
Mr Collins' side of the story
Mr Collins argued that the tenants' interest in the units was orally re-assigned from the Xaverian Missionaries, back to himself, in a meeting attended by Mr Collins and Xaverian in March 2005. Comhairle's consent was given over the phone when Xaverian phoned them during the course of that meeting, he said. He was therefore of the opinion that the lease was now in his name and would not expire until the original expiry date in April 2007.
However, nothing was ever put in writing and he never paid any rent.
Incredible, Inconsistent and In Breach
The Sheriff chose not to believe Mr Collins' version of events - and he was not short of reasons:-
# he found it "scarcely credible" that, having gone to the trouble of preparing and signing a formal assignation of the lease to Xaverian in 2003, the same parties should then be happy to rely on an oral re-assignation, consented to over the phone, with nothing at all in writing to confirm this.
# Mr Collins had not produced any evidence whatsoever of anything said or done since the date of the purported re-assignation to confirm that it had actually happened.
# letters from Comhairle to Xaverian were entirely inconsistent with Mr Collins' proposition that there had been a re-assignation in his favour.
# there were letters from Xaverian which totally contradicted the re-assignation story.
# no rent had been paid by Mr Collins. He offered no explanation for this and it therefore seemed likely to the Sheriff that the obvious explanation was that it hadn't been paid because it hadn't been due - there had been no such re-assignation in Mr Collins' favour.
Although this resulted in a resounding success for Comhairle in showing that Mr Collins had no right, title or interest in the units, the Sheriff refused to grant them the interdict they were looking for. The court explained that interdict is a remedy which is available against a wrong which is in the course of being committed or where there are reasonable grounds for believing that a wrong may be committed in the future. Although the court was prepared to accept that it looked likely Mr Collins was the person responsible for the dumping of vehicle shells around the estate, there did not appear to be any reason to believe that he would continue to do so after the court's decree that he had no right, title or interest to the units.
Get it right in writing
It is an old chestnut, but a good one - always commit to writing any agreement reached in relation to the letting of premises. All too often things go wrong, and sorting it all out is much more difficult where there is nothing in writing documenting the position. This is not just the case in relation to assignations of tenants' interests, landlords are often also guilty of letting tenants take entry to their premises without a lease being in place, only to regret their decision when the rent falls into arrears or the roof starts to leak.
Similarly, tenants should insist on a lease being in place before they take entry, to ensure that the terms of occupation which they believe to be the case are on all fours with the landlord's understanding of the position. To do otherwise is a risky decision which one may well live to regret.