Any term in a consumer contract must be fair. This rule also applies to tenancy agreements. The Consumer Rights Act 2015 and the Unfair Terms in Consumer Contracts Regulations 1999 explain the types of terms that may be considered unfair.
An unfair term is unenforceable and the landlord can’t rely on it when taking legal action against a tenant. Trading Standards is responsible for dealing with complaints about unfair terms, so you should contact Consumerline if you have any concerns about your contract.
Language used in contracts
All terms in your tenancy agreement must be
- prominent and
“Transparent” means that the term is written in plain, understandable language and that it is legible. “Prominent” means that the term is not hidden away, such as in small print. An average consumer should be able to read and understand the terms in a contract.
Your tenancy agreement cannot take away your basic rights. Any terms in the tenancy agreement that attempt to do this could be seen as unfair. Schedule 2 of the Consumer Rights Act 2015 gives examples of the types of terms that could be considered unfair.
When did you sign your contract?
The rules on unfair terms differ slightly depending on when your contract began. If the contract began before 1 October 2015, the contract will be considered under the Unfair Terms in Consumer Contracts Regulations 1999. Individually negotiated clauses between two parties can’t be unfair under these regulations, so any terms you and the landlord added to the basic contract will not be reviewed by Trading Standards for fairness.
Contracts which began on or after 1 October 2015 are subject to the Consumer Rights Act 2015. All terms, including ones individually negotiated by the landlord and the tenant, must be prominent, transparent and fair to comply with this law.
What kind of terms are unfair?
A contract term could be considered unfair if it
- allows the landlord to charge an excessive late fee for non-payment of rent
- requires you to pay any fees that the landlord is liable for in carrying out his business as a landlord (e.g. HMO registration fees, or fees for a Fitness Inspection)
- allows the landlord complete freedom in deciding whether you have breached the tenancy agreement
- allows the landlord to break the contract early for no reason but doesn’t give you the same rights
- requires you to pay for repairs that are the landlord’s responsibility
- allows the landlord freedom to enter the property without giving you reasonable notice
- requires you to hand the property back to the landlord in a better condition than you received it.
The Competition and Markets Authority has produced guidance on unfair terms in consumer contracts. This guidance should be applied to tenancy agreements.
The rules on unfair terms don’t usually apply to the price and main subject matter of a contract. While you can’t object to the price of your rent, the term about your rent should still be written in plain language.
Getting help with unfair contracts
You should always review a contract before you sign it. Explain any concerns you have about the fairness of the terms and ask the landlord to consider reviewing the terms.
Contact Trading Standards if you think that some of the terms in your tenancy agreement are unfair. Trading Standards can review the contract and may ask the landlord or agent to remove some of the terms.
You can raise the issue of an unfair term at court if your landlord has taken you to court and is relying on a term that you believe to be unfair. The judge may want to know what Trading Standards have said about the fairness of the contract.