This is one of those phrases you may hear mentioned around which does have a deeper legal meaning – ‘vacant possession’ of a property.
In short, it means leaving a property empty. Typically, this might be at the end of a lease when a tenant vacates, or a buyer purchasing a property with nothing left there.
If you add a bit more legal technicality to this, the receiving party must be able to immediately exclusively occupy and possess the property at the relevant time in question.
In principle, this all makes sense. Any new tenant or owner will of course want an empty property without anything left from any previous owners or occupiers. And such previous interests will of course try their best to make sure the property is handed back in a presentable fashion.
But reality can be different, with varying expectations of what is ‘presentable’ and goal-posts changing.
And this can cause serious consequences, for example new tenants and buyers not wanting to go through with things, and owners left chasing previous ones to sort out the mess.
This affects all property types, so even down to a leaving a small residential flat when an AST ends, however, the stakes become higher often with bigger commercial properties.
Plus, where you have complicated scenarios with legal documentation, so for example, if a tenant serves a break notice in a lease which relies upon effective ‘vacant possession’ being given. Therefore, not providing vacant possession can mean the break could be classed as invalid and the tenant is left with an extended lease liability.
So, here’s some helpful pointers for making sure the famous vacant possession, or ‘VP’ as some people refer to, is correct:
1. Handing Back Keys
Real simple, but this act of handing back any keys to the landlord or owner can show that you are handing back possession – plus any other forms of access and security like alarm or lock codes.
Just make sure these are to the right people, at the right time, and recorded is the correct fashion. And if you are at the receiving end with queries, you may deliberately not want to accept these back.
2. Ending all Legal Interests
Pretty straight forward in principle – all other legal interests like sub tenants and incenses also needing to end by the vacant-possession date.
However, don’t forget other ancillary ones like wayleave agreements and telecoms equipment.
And watch out for the grey areas and nasty surprises like sudden squatters and trespassers, which although will not have been permitted by the current occupier or owner, they may well end up unfortunately being their problem to then resolve.
3. No People Left Behind
When it comes to the official vacation date, then just make sure that people are literally off site okay with no one hanging around causing potential issues of continued ‘occupation’.
So, no contractors left, even if works have not yet been completed. And no individuals doing a spot of last minute cleaning or inspection.
Only in extreme cases may there be a legitimate reason for someone still being there, but even then, it may go legal trying to justify. As an example, security guards and any essential barriers to stop any form of illegal access may be passable.
4. Removing Fit out and Contents
Of course, this is obvious in principle, that any goods and contents of the occupier must have gone where needed. So maybe their fit-out and shelves, right down to furniture and materials.
However, things can get technical here with legal reference to ‘chattels’ and ‘fixtures’. Sifting through leases and documents is key to see what must be removed and made-good as part of any official ‘re-instatement’ and ‘yielding up’ of the property.
Although very loose items are fairly obvious, some things may be fixed to the property and need to stay, or others time to go. There can also be grey areas like carpets and shelving that need clarification.
5. No Loose Items
This is kind of linked with the previous point and practical items being left on site, but worth a special mention as this covers often very small and unnoticeable items that may not be otherwise easily spotted.
So, things like bags of rubbish, odd chairs, boxes of items, and even coffee mugs can cause queries. Although there is a little room for error and common sense here to still permit ‘vacant possession’, its better to be safe than sorry, and watch out for things like bags of rubbish mounting up and suddenly causing issues.
Saving Vacant-Possession Problems
As you face this issue of a property being correctly left vacant, make sure its crystal-clear what this practically means and that it ticks the legal boxes of what ‘vacant possession’ is to save further recourse.
If you’re a tenant ending a lease or vendor selling a property then you’ll want to make sure you’re not liable for issues by not providing this. If you’re a landlord, purchaser, new tenant or advisor then make sure this is being correctly achieved.
And if in doubt, go the extra mile to demonstrate this, and get recorded in writing and if needs be by photos. In extreme cases people can be stripping out all kinds of re-fits in a property which may well cause them a greater repairing and dilapidations liability, all in the name of making sure ‘VP’ is valid and the transaction not coming to a halt.
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