Alienation

Question 1

What is alienation?

Answer 1

Disposal of all or part of tenant’s interest in lease

Question 2

If a lease is silent on assignments/underletting can the tenant do so?

Answer 2

Yes

Question 3

What is an absolute covenant against assignment?

Answer 3

Not allowed

Question 4

What is a qualified covenant against assignment?

Answer 4

Allowed with landlord’s permission

Question 5

What is the effect of s19(1)(a) LTA 1927 on qualified covenants against assignments and underletting?

Answer 5

converts into fully qualified (must not unreasonably withhold consent)

Question 6

When and how must a landlord make a decision on consent to assign/underlet?

Answer 6

Within reasonable time and burden on L to prove reasonable refusal with written reasons

Question 7

When may a landlord be able to reasonably withhold consent for assignment?

Answer 7

• Must relate to landlord/tenant relationship
• Tenant mix policy (eg proposed use)
• Inability to pay rent

Question 8

What can happen if the landlord unreasonably withholds consent to assign or delays in making decision?

Answer 8

tenant can claim damages

Question 9

If a lease is silent on providing an AGA as a condition of a assignment, can a landlord request one anyway?

Answer 9

Only if reasonable to do so

Question 10

Who will draft a licence to assign?

Answer 10

Landlord solicitor

Question 11

Who will draft a contract for assignment?

Answer 11

Tenant solicitor

Question 12

Who will deduce title for an assignment?

Answer 12

Tenant solicitor

Question 13

Who will apply for consent to assign and from whom?

Answer 13

Tenant solicitor applies, Landlord solicitor confirms receipt

Question 14

What will the landlord’s solicitor ask from the tenant’s solicitor in terms of the application for consent to assign?

Answer 14

Undertaking for costs

Question 15

How will the tenant’s solicitor dedice title for assignment?

Answer 15

• official copies of leasehold title or if unregistered - landlord title
• copy lease

Question 16

What enquiries will the assignees solicitor raise?

Answer 16

CPSE1 and CPSE4

Question 17

Who will draft the Deed of assignment?

Answer 17

Assignee solicitor

Question 18

Who will prepare and pay the completion statement?

Answer 18

• Tenant solicitor prepare
• assignee pays

Question 19

What pre completion search is raised for an assignment?

Answer 19

OS1 for leasehold title

Question 20

What form is the deed of assignment in for registered leasehold?

Answer 20

TR1

Question 21

Which document will the landlord be involved in completing/not be involved?

Answer 21

• completes license to assign
• not involved in deed of assignment

Question 22

What are the post completion steps for the assignees solicitor?

Answer 22

• Submit SDLT/LTT return and pay
• Register assignment (if over 7 years)
• Send formal notice of assignment to Landlord’s solicitor

Question 23

Does the original tenant still owe the original landlord rent/obligations if it underlets?

Answer 23

Yes

Question 24

Does a qualified covenant for underletting convert to a fully qualified covenant within reasonable time?

Answer 24

Yes

Question 25

How will a lease typically prevent a tenant from underletting premises?

Answer 25

o Together with property not belonging to landlord o On payment of lump sum o With rent free period beyond what is normal in that market

Question 26

What will leases typically require for underletting?

Answer 26

o Is at rent no lower than T’s lease o Contains covenants no less onerous than T’s lease

Question 27

Does privity of contract exist between a landlord and an undertenant?

Answer 27

No

Question 28

Does privity of estate exist between a landlord and an undertenant?

Answer 28

No

Question 29

How can an undertenant directly covenant with the landlord?

Answer 29

In license to underlet

Question 30

Will an AGA be relevant for underletting?

Answer 30

No

Question 31

Who will draft the underlease?

Answer 31

Tenant solicitor

Question 32

Who will draft the agreement to underlease?

Answer 32

Tenant solicitor

Question 33

Who will draft the licence to underlet?

Answer 33

Landlord solicitor

Question 34

Will the landlord's solicitor be involved in completing the lease/agreement for underlease?

Answer 34

No

Question 35

What will the landlord's solicitor ask from the tenant's solicitor in terms of the application for consent to underlet?

Answer 35

Undertaking for costs

Question 36

For deducing the title when underletting, what should the tenant's solicitor provide to the undertenant's solicitor?

Answer 36

* Over 7 years – only provide official copy leasehold title * 7 years or less – official copy Landlord freehold title and copy of the lease

Question 37

What are the pre-completion searches for underletting?

Answer 37

OS1 underletting of whole or OS2 underletting of part If not registered – OS3 against T’s interest

Question 38

What precompletion search is used where the underlease being taken on is not registrable?

Answer 38

OS3

Question 39

What is the notice of dealing requirement under licences to assign/underlet?

Answer 39

Assignee (assignment) or Tenant (underlet) required to give formal notice within a month that transaction has completed

Question 40

What are other forms of alienation?

Answer 40

- tenant creating charge over lease - tenant sharing occupation

Question 41

Which document will contain an undertenants direct covenants with the superior landlord?

Answer 41

Licence to underlet

Question 42

What are the post completion steps for underletting?

Answer 42

* SDLT/LTT return and pay * Register underlease if over 7 years