The decision of the Upper Tribunal in Iveta Nemcova v.
Fairfield Rents Limited  UKUT 303 (LC) is a reminder
that it is not just the alienation covenant that must be considered
when a tenant seeks to deal with its lease. In this case a covenant
not to use the premises "other than as a private
residence" was sufficient to prohibit short-term Airbnb-style
Iveta Nemcova was a long leaseholder of a flat on the Enfield
Island Village housing estate. Fairfield Rents Limited was the
freeholder and landlord.
Under the terms of the lease the tenant was free, at any time
prior to the last seven years of the term, to assign, underlet or
part with possession of the whole of the premises without
landlord's consent. Believing that there were no restrictions
on disposals, the tenant granted a series of short-term lettings of
the flat, having previously advertised the same on the
Citing the user clause, the landlord brought an action seeking a
declaration that the tenant had breached the lease covenants. Under
the relevant clause the tenant had covenanted "not to use the
Demised Premises or permit them to be used for any illegal or
immoral purpose or for any purpose whatsoever other than as a
The Upper Tribunal held that there had been a breach of the user
While the user clause did not require the tenant to occupy the
premises herself it did require that whoever was occupying was
doing so "as a private residence". In determining what
that meant neither the demand and acceptance of payment by the
tenant from the occupier nor the reason for the occupier being in
occupation was decisive in this particular case.
However, what was material here was the duration of the
occupier's occupation. There had to be a degree of permanence
otherwise the occupation would be so transient that "the
occupier would not consider the property he or she is staying in as
being his or her private residence even for the time being".
Lettings for a very short term (being of days and weeks rather than
months) would not constitute occupation as a private residence.
The judgment in this case highlights:
When considering what a tenant is allowed to do it is essential
to consider all the terms of the lease. Here the user covenant
operated as an effective prohibition on a certain type of disposal,
namely short-term lettings. In another case earlier this year,
Roundlistic Limited v. Jones and Seymour  UKUT 325,
a user clause was construed as prohibiting all forms of
Each case will turn on its own facts and in particular the
wording of the relevant covenants. As such the same or a similar
user clause could be construed differently in other circumstances.
To avoid uncertainty, if a party intends to preclude short-term
lettings it would be preferable for this to be stated explicitly
rather than being made implicit through the user covenant.
With the increasing popularity of short-term lettings of
residential space this case may well prompt many to dig out and
review more than just the alienation covenants in their leases.
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