12.11: Structure and content of a lease and termination of a lease

Question 1

Alienation

Answer 1

This means dealing with the tenant’s interest in the property. Subletting or changing it. If the lease contains no provisions regarding alienation, the tenant can deal with it as they wish.

Question 2

Assignee

Answer 2

The party taking on the assignment of the lease. The assignee becomes the new tenant. They take on the lease.

Question 3

Assignor

Answer 3

The party assigning the residue of their lease

Question 4

Demised premises

Answer 4

The premises defined in the lease that are subject to the matter of the grant

Question 5

Immediate landlord

Answer 5

the person in the position of landlord. This can be the person who has created the sub let

Question 6

Landlord

Answer 6

The actual owner of the freehold who carves out leases out of the freehold property

Question 7

Privity of estate

Answer 7

A legal relationship that exists between parties where they hold the same interest in the same land for the time that they hold the interest.

Question 8

Residue

Answer 8

The number of years left to run on a lease that is being assigned.

Question 9

When is a lease automatically registrable at the HMLR

Answer 9

when granted for a term of more than 7 years

Question 10

Are break clauses implied into a lease?

Answer 10

No - if either party wants to use a break clause they must expressly included in the terms of the lease

Question 11

Prescribed clauses

Answer 11

If the lease is registrable at HMLR, this is contained at the beginning and contains a summary of the provisions in standard format

Question 12

Demised premises

Answer 12

The subject matter of the leases ie. the extent of the premises which are included in the lease

Question 13

Tenant/landlord covenants

Answer 13

Obligations imposed on the tenant or landlord. For the landlord, this includes the quiet enjoyment of the lease. Others which apply to both is the maintenance of the property.

Question 14

Forfeiture

Answer 14

Right to bring the lease to an end. Not implied into the lease must be included as a term

Question 15

Demise

Answer 15

Physical extent of the premises

Question 16

Security of tenure

Answer 16

Right to stay in the property at the end of the lease. Applies more to Business tenants unless expressly excluded

Question 17

Ground rent

Answer 17

On a long residential lease, rent is described as the ‘ground rent.’

Question 18

What happens if there is no provision in the lease dealing with alienation (subletting, assigning the lease etc)?

Answer 18

Tenant is free to deal with the property as they wish

Question 19

Absolute covenant

Answer 19

Prohibits the specified act from being carried out (alienation / re-assigning the lease)

Question 20

qualified covenant

Answer 20

tenant is allowed to alienate the property but must first obtain the landlord’s consent. Do not require the landlord to behave reasonably if they withhold their consent

Question 21

fully qualified covenant

Answer 21

requires the landlord to act reasonably in deciding whether they should grant their consent. Means that the landlord cannot unreasonably withhold their consent

Question 22

What does section 19(1) of the Landlord and Tenant Act achieve?

Answer 22

converts a qualified covenant into a fully qualified covenant ie. it adds on that consent should not unreasonably withheld by the landlord

Question 23

Can a landlord recover costs for giving consent to change the use / re-assign the property?

Answer 23

Yes they can recover REASONABLE costs for giving consent, such as fees for a solicitor or surveyor. Section 19(3) of the Landlord and Tenant Act applies, only where the change of use does not involve structural alterations

Question 24

What happens if a commercial lease contains an absolute prohibition against making alterations / improvements

Answer 24

LTA 1927 s3 permits the tenant to serve notice on the proposed works. if the landlord does not object within 3 months, the tenant can carry out the works. If the landlord does object, the tenant can apply to the court for an order

Question 25

Can a landlord change the rent if there is no clause in the lease setting out the mechanism for increasing the rent?

Answer 25

No - must be a clause in the lease

Question 26

Name the rent reviews in a commercial lease

Answer 26

- open market (calculates what the rent would be if the premises were let on the open market) - turnover (rent payable according to the financial year) - stepped rent (rent increases and at what intervals)

Question 27

How can a Landlord demand a forfeiture for non-payment of a lease?

Answer 27

- formal demand for the rent due - if the rent is still not paid, an order for possession - if a commercial premises, can also effect forfeiture by peaceable re-entry

Question 28

What is the significance of waiver?

Answer 28

if the right to forfeit a lease has risen, landlord must ensure that they do not do anything which can waive their right (ie recognise that the lease continues to exist in words or by accepting payments for missed rent fees)

Question 29

How can a tenant be reliefed?

Answer 29

- non-payment of rent, if they pay all the arrears and landlord's costs, tenant is usually entitled to keep the lease - for breaches of other covenants

Question 30

Effluxion of time

Answer 30

Where the lease is for a fixed period, it will automatically come to an end at the end of that period

Question 31

Surrender

Answer 31

in a fixed term lease, where both parties unilaterally bring the lease to an end

Question 32

Merger

Answer 32

Where a leasehold mergers into a freehold ie. the tenant buys the freehold. Landlord no longer exists and the tenant becomes the freehold owner.

Question 33

LTA 1927 s3

Answer 33

where there is an absolute prohibition against the tenant making any alterations on the property, s3 allows the court to make improvements to the property

Question 34

When will the landlord have a remedy for forfeiture

Answer 34

- if there is a provision in the lease allowing the landlord the right of re-entry - the tenant's obligation is a termed condition in the lease - the right of forfeiture arises automatically if the condition is breached