10.1 Alienation Flashcards
What is the effect of an overriding lease granted pursuant to 19 LT(C)A
Makes T immediate L of assignee who has defaulted
Two types of deed for assignment
DoA or TR1
Tenant-mix
Moss Bros v CSC Properties
Why does L want direct covenant w/ A under old lease + UT to comply w/ T’s covenants
To give direct action
What is an assignment
Sale of lease
When will T remain bound by PoC even if new lease
If the assignment was unlawful (failed to comply w/ conditions of assignment)
Docs to investigate for T’s title for underlease
OCs if reg, lease and subsequent docs
What is the effect of 19(1A) LTA ‘27
Makes circumstances of refusal and conditions of A automatically reasonable
Reasonable response
Dong Bang Minerva v Davina
Whose title do you investigate for underletting
Immediate L and superior L’s titles
What is the position on privity of contract for old leases
PoC remains for outgoing T on assignment for entire term
What to consider first in law part of alienation Q
19(1)(a) LTA ‘27
When is an underlease registrable
If term over 7 years
How is consent to alienation given (generally)
Deed of Licence
What happens to the headlease in underletting
Remains
19(1C)
If 19(1A) condition by ref to subjective opinion, that person must act reasonably or give T right to refer to independent 3rd
What case is always applicable under 19(1)(a) LTA
International Drilling v Louisville
Crestfort v Tesco Stores ratio
Preconditions to underletting are mandatory + failure to comply means L need not even consider T’s app
What section + statute permits L to ask T for AGA
16 LT(C)A
What was considered obiter on 1 LTA 1988
L bound to response by 1 LTA even if preconditions of consent for alienation not met
Consent in principle
Aubergine v Lakewood
Three cases on 19(1)(a) LTA ‘27
International Drilling v Louisville; Moss Bros v CSC Properties; Ashworth Frazer v Gloucester CC
What document must be used for lease of longer than 3 years
Deed
When is a deed not needed for a lease
If 3 years or less
What does 17 LT(C)A require
If L claiming rent, serve rent default notice on OT within 6 months of payment becoming due
Milmo v Carreras key
Term in underlease
What is underletting
Grant of a new lease out of a headlease
Consent of who for underletting if applicable
Mortgagee
Crestfort v Tesco Stores key
Underletting preconditions
When does an assignment need to be registered at LR
If unregistered + >7 years left, or if reg then change details on Proprietorship Register
What case warns against giving consent in principle to alienation
Aubergine v Lakewood
Moss Bros v CSC Properties ratio
L can have tenant-mix policy if known + rational
What is a new lease
On/after 01/01/96
What provisions in underlease must be less than in headlease
Term and rent
What is the effect of an AGA
T liable for A’s defaults, for term or until A assigns
Why is outgoing T’s covenant strength no longer determinative for whether to give consent to assignment under new lease
Because outgoing T won’t remain liable
Conditions for AGA to be imposed under 16 LT(C)A
Assignment requires consent + lawful condition of assignment is to enter into AGA
What if preconditions on assignment + old lease
As long as doesn’t state what = reasonable refusal, conditions are valid
International Drilling v Louisville ratio
To be ‘reasonable’ under FQC, refusal must be to do w/ L-T relationship
When does privity of estate cease
As soon as interest in land disposed of
Term in underlease
Milmo v Carreras
Who will you also need consent from for assignment, if applicable
Mortgagee
What is L likely to get from assignee under old lease + UT
Direct covenant to comply w/ T’s covenants
What can you argue for preconditions to underletting, despite Crestfort
Still unreasonable - apply International Drilling
What are the title deeds for investigation of title on assignment
Lease, OCs and docs affecting lease
Within what time period must assignee apply to LR to change details of T on Proprietorship Reg
Within priority period of OS1R
What can T do under 19 LT(C)A
Demand in writing within 12 months of payment to be granted overriding lease
When will SDLT be payable after assignment of lease
If premium paid above SDLT threshold
What additional doc for assignment may be condition of assignment, imposed by L
AGA
What is the next stage after applying 19(1)(a) LTA
Look to see if any preconditions of alienation
Dong Bang Minerva v Davina ratio
28 days considered reasonable when L given e.g. HoT for 1 LTA ‘88
What kind of covenants does 1 LTA ‘88 apply to
FQC
What if underlease for 3 years or less
No deed needed
When is AGA unnecessary
If old lease, as T remains liable for entire term
What prohibits L charging fine for giving consent to alienation unless expressly included in lease
144 LPA ‘25
144 LPA does what
If consent needed to alienate, cannot charge fine unless lease expressly permits
Moss Bros v CSC Properties key
Tenant-mix
Example of a doc that may affect the lease (for investigation of title)
Deed of Variation, Licence to Assign
What if preconditions on underletting
Mandatory + failure to comply means L need not even consider T’s app
Breach covenant
Ashworth Frazer v Gloucester CC
What is an old lease
Before 01/01/96
What docs do you investigate for L’s title
OCs if reg or epitome if not
What may be a condition of A if assignee is of lower financial standing
Guarantor or OT to give AGA
What does 1 LTA 1988 require
L to give written consent within reasonable time, unless reasonable refusal
When can T recover expenses paid for L to consider alienation request
If L unreasonable or does not comply w/ 1 LTA 1988
Underletting preconditions
Crestfort v Tesco Stores
Who is deed between for assignment
Outgoing T and assignee
What might L do if within circumstances to refuse, but chooses to give consent
Impose conditions also set out within lease
Can L charge fine for giving consent to alienation under 19(1)(a)?
Only if lease expressly permits (144 LPA ‘25)
When does 16 LT(C)A apply
If assignment can’t be affected w/o consent and lawful condition of A is to enter into AGA
Effect of not registering assignment w/ LR
Assignee does not have legal interest
What is privity of contract
Between parties to C
What is privity of estate
Share immediate interest in same land
After both assignment or underletting happen, who must be notified
L
Ashworth Frazer v Gloucester CC ratio
L can reasonably refuse under 19(1)(a) if believe A will breach covenant
Three kinds of alienation
Surrender, underletting and assignment
1 LTA 1988 on what
Provides for L’s response to application for alienation
Who is burden on to prove reasonable refusal of alienation request
L
What happens to liability of outgoing T on assignment
Disappears if new lease
When does 1 LTA ‘88 apply (response from L within reasonable time)
If T makes written app for consent + FQC
What statute and provision provides for L’s response to application for alienation
1 LTA 1988
28 days considered reasonable when L given e.g. HoT for 1 LTA ‘88
Dong Bang Minerva v Davina
Ashworth Frazer v Gloucester CC key
Breach covenant
What happens if conditions under 19(1A) are by ref to subjective opinion
That person must act reasonably or give T right to refer to independent 3rd (19(1C)
What statute + section upgrades QC to FQC
19(1)(a) LTA ‘27
When a new lease is created (out of freehold or underlease), what is registered at LR
New title number in own right for lease
Can L charge reasonable sum for giving consent to alienation under 19(1)(a)?
Yes but only if expressly in lease per 144 LPA ‘25
What is interplay between 19(1)(a) and 19(1A)
Consider if scenario has condition stated in lease (19(1A)), and if not then consider if reasonable per International Drilling
What if preconditions on assignment + new lease
19(1A) LTA ‘25 applies
Dong Bang Minerva v Davina key
Reasonable response
What two docs needed for assignment
Deed and Licence to Assign
L-T relationship (case)
International Drilling v Louisville
What must happen if lease registered on Proprietorship Register but then assigned
Change details of T on Proprietorship Register
Is there privity between UL and L in underletting?
Not unless Licence to Underlet granted
What is FQC
Consent not to be unreasonably withheld
19(1A) LTA ‘25 only applies to what
Assignment + new lease
5 LT(C)A did what
Removed privity of contract for outgoing tenant on assignment
What is the position on privity of contract for new leases
PoC removed for T and new assignee automatically bound by T’s covenants
Aubergine v Lakewood ratio
Consent in principle to alienation can = full consent so do not give prior to completion of documentation
International Drilling v Louisville key
L-T relationship
16 LT(C)A permits what
T can give L AGA
Aubergine v Lakewood key
Consent in principle
What structure (in terms of what to consider) for alienation Q
Four L’s
Easiest way out of a lease is how
Exercise break clause
Form to register underlease w/ LR
AP1
How do you know 19(1A) only applies to new leases
‘Qualifying lease’, defined in 1E
Milmo v Carreras
If term in under lease is not less than headlease, takes effect as A
When is TR1 used for assignment
If lease registered.
What might happen if L fails to comply w/ 1 LTA 1988
Damages for BoSD
Who is Licence to Assign between
All - OT, assignee and L
Case on 1 LTA 1988
Dong Bang Minerva v Davina
Documents for underletting (procedural)
Deed if over 3 years, Licence to Underlet
Preconditions to underletting are mandatory + failure to comply means L need not even consider T’s app (case)
Crestfort v Tesco Stores
What statute removed privity of contract for outgoing tenant on assignment
5 LT(C)A
What does The Code recommend for AGAs
Only condition of A if assignee of lower financial standing
What happens if term is not less than headlease in underlease
Takes effect as A
Why do all three parties sign Licence to Assign/Underlet
For L to give permission to T, and for UT/A to enter into direct covenant with L to perform covenants (if old lease + A or UL)
What four things does LTA/UL usually cover for assignee/undertenant
Comply with covenant, indemnify for breach, duty to reg if applicable, and notify L of address for rent demand (only A)
Who usually agrees to pay L’s expenses in giving consent to assignment/UL, and where do they give that agreement?
(Outgoing) T usually agrees, given in LtUL/A
Why will you need to check OCs for LTA/UL
To see if need to get mortgagee’s consent
