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Scenario:

  • Alan advertises a room to rent in a joint tenancy property in which they are lead tenant
  • Zoe views the room and verbally expresses an interest in renting it
  • Alan passes on Zoe's contact details to the estate agent
  • The estate agent contacts Zoe by email, providing a draft contract and asking for further information in order to complete her details
  • Zoe provides the requested details, again by email
  • The contract is drawn up and the estate agents inform both Alan and Zoe that it is ready to be signed
  • A week later (having not yet signed), Zoe informs the estate agent that she no longer wants to take the room

Question:

In UK law, is it possible that the email correspondence between Zoe and the estate agent would provide strong enough evidence of intention for Zoe to be held liable for costs incurred by Alan and/or the landlord of the property as a result of her late withdrawal?

So far I have found guidance which states that a verbal agreement is rarely considered binding with respect to tenancy agreements, but no clear information about written agreement prior to signing or liability in such a circumstance.

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No

The tenant is liable if they break a contract: there is no contract here. One of the tests for a contract is that there is an offer that if accepted will create a clear, unambiguous contract. Looking at the enumerated facts:

  • Alan advertises a room to rent in a joint tenancy property in which they are lead tenant - not an offer, this is an invitation to treat
  • Zoe views the room and verbally expresses an interest in renting it - not an offer, this is the opening of negotiations
  • Alan passes on Zoe's contact details to the estate agent - not an offer, this is communication between one party and their agent
  • The estate agent contacts Zoe by email, providing a draft contract and asking for further information in order to complete her details - not an offer, the contract is a "draft"
  • Zoe provides the requested details, again by email - not an offer, just a transfer of information
  • The contract is drawn up and the estate agents inform both Alan and Zoe that it is ready to be signed - this is an offer
  • A week later (having not yet signed), Zoe informs the estate agent that she no longer wants to take the room - ... that was not accepted

Further, the tenant is liable if they are promissory estopped - they have withdrawn a promise made to a second party if the latter has reasonably relied on that promise. Zoe has made no promises other than one to negotiate - she has negotiated.

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    Note that if Zoe had paid a holding/admin deposit to the agent, she probably wouldn't get it back.
    – Steve Melnikoff
    Aug 31, 2017 at 8:50
  • Thank you for breaking it down, but after reading the link you provide about 'promissory estoppel', is it not possible that it could apply in this case? The key criterion is "an unequivocal promise by words or conduct" - could it not be argued that by going along with the contract process that Zoe's conduct implies a promise? Alternatively, would it make a difference if there was correspondence to the effect of 'I will take the room' (for example)?
    – DaveMongoose
    Aug 31, 2017 at 16:42
  • @DaveMongoose you could argue that - you would lose. Negotiations are not promises.
    – Dale M ♦
    Aug 31, 2017 at 19:21
  • @DaleM I was only seeking clarification, there's no need to be so abrupt...
    – DaveMongoose
    Sep 1, 2017 at 9:10
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    @DaveMongoose don't read tone into comments that is not actually there.
    – Dale M ♦
    Sep 1, 2017 at 11:25

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