A decision has been made this week in the case of Riverside Housing Association who were taken to court by their tenants over rent increases.
Riverside, a charitable housing association and RSL were challenged about the validity of four rent increases which took place between 2001 and 2004 by their tenants (Mr and Mrs White and others). The tenants alleged the way in which Riverside carried out these rent increases was not in accordance with the terms and conditions of their tenancy agreements which stated that:
“…Riverside may increase the rent by giving the tenant four weeks notice in writing as set out in accordance with the provisions of this agreement…
The rent payable will be increased annually with effect from the first Monday of June each year. (This is known as the rent variation date)…”
The rent increases which occurred between 2001 and 2004, took effect from the first Monday in April of the respective years (not in June in accordance with the tenancy agreement) and were preceded by a notice giving the tenants at least 28 days notice of the rent increase.
Initially the Court found the four notices were valid as the first Monday in June was not a crucial date, therefore it was open to Riverside to implement the rent review with effect from a different date. Mr and Mrs White and others appealed to the Court of Appeal, which held that Riverside were not entitled to increase the rent on a different or later date. This decision was detrimental to Riverside and so they appealed the Court of Appeal’s decision to the House of Lords.
The House of Lords judgment this week (24 April) was as follows:
The rent review clause in the tenancy agreement was different from the commercial rent increases which the court had previously considered in other cases. Strict interpretation of the rent increase clause meant it was open for Riverside to increase rent with effect from any date after the first Monday in June in any particular year, provided that tenants were first given 28 days’ notice. Tenants were not prejudiced by the change in date as the method of actually calculating the increase was all set out in the tenancy agreement and was adhered to by Riverside.