L&T 2 Flashcards

1
Q

What is the difference between a lease and a licence?

A
  • Lease give a tenant exclusive rights of possession,
    which excludes 3rd parties such as a landlord
    rent is normally is usually made in return for possession.
  • Licence gives permission to do something on someone’s land/property that would otherwise be deemed as trespass
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2
Q

What is the leading case in the matter of “lease or licence”?

A

Street v Mountfort 1985

Case determined the difference between a lease and a licence as the parties intention is a contributing factor for exclusive possession.

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3
Q

In what circumstances have you granted (or would consider granting) a licence?

A
  • Erecting of an advertising board
  • Car parking space
  • use of a bin store
  • To hire out an event hall
  • Free standing kiosk in a shopping centre
  • Burger vans
  • Ice-creams vans
  • Market stalls
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4
Q

You are managing a property that is going to be redeveloped at some unknown date in the future. What letting options do you have to generate some rental income without giving the tenant security of tenure under the 1954 Act?

A
  • Grant Leases of less than 6 months (section 43)
  • if over 6 months agree to contract out of section 24-28 of 1954 act. (section 38). Advise client rolling break.
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5
Q

A Tenant has entered into a full repairing and insuring lease of a property in disrepair. The landlord now requires the tenant to remedy this repair. What advise would you give to this tenant?

A
  1. Check the wording of the repair covenant of the lease
  2. Confirm to the tenant they are responsible.
  3. The standard of repair would depend on the age and surrounding areas.
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6
Q

What advise would you give to a tenant wanting to take a FRI lease of a property in disrepair but suiting his business

A
  • The tenant could look to seek a rent incentive to undertake the works
  • Ask the landlord to put in repair prior to occupation
  • Limit repairs by schedule of condition
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7
Q

What action can a landlord take when a tenant is in breach of repairing covenant?

A

Serve a section 146 notice law and property act 1925. Notifying tenant of:
- breach
- requesting T to remedy the breach
- landlord could go in and complete the repairs themselves, and claim for damages. Javis v Harris

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8
Q

What action can a tenant take when a landlord is in breach of repairing covenant?

A
  • Go to court getting an injunction for LL to complete the works.
  • If LL does not respond to notice/court complete works themselves and claim a set-off against the rent.
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9
Q

What does the Jervis v Harris case mean to you?

A

When the landlord exercised the right to re-enter the property and do works and claim it as a debt.

Avoids damages under S18 of the L&T act 1927.

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10
Q

How are damages assessed when a tenant is in breach of repairing covenant?

A

Amount to the diminution in value to the Landlord’s reversion caused by the Tenant’s breach. Damages are limited by S18 of the 1927 act.

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11
Q

How are damages assessed when a landlord is in breach of repairing covenant?

A

Difference in value between the premises in their condition at the time of assessment and the value if the LL had undertaken the repairs when on receipt of the notice.

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12
Q

Explain the provisions of S18(1) of the L&T act 1927

A

Damages limited to the extent in value caused by T breach

Jones v Hexheimer (1950)
- T left room in residential house in poor cstate
- L obtained aware of £36 redecorate

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13
Q

Explain difference between a schedule of condition and a schedule of Dilaps

A

SoC = statement describing the physical state of the building

SoD = Record of alleged breaches of repairing covenant undertaken by a landlord surveyor

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14
Q

Explain the difference between an Interim and Terminal schedule of dilaps

A

Interim schedule – can be served within more than 3 years left of the term
Terminal schedule – served at the end of the term or last 3 years of the term

You have 56 days after lease expiry to serve a dilaps schedule

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15
Q

What is a Scott schedule?

A

It is a schedule showing the items of disrepair and the cost to put in repair in the recommended form that a schedule of conditions should to be presented to court.

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16
Q

What is the difference between an alteration and an improvement?

A

Alteration = makes physical changes to a building
Improvements = Alteration that adds value

17
Q

Your tenant client wishes to extend an industrial property. Explain the factors that need to be considered and the action that needs to be taken.

A
  1. Read the lease and check the alterations clause.
  2. Apply for improvements to be registered under The Landlord and Tenant Act 1927 to ensure compensation is paid for improvements.
  3. Landlord has 3 months to reject / do the works themselves
  4. Tenant should consider:
    - unexpired term (surrender)
    - The wording of the rent review clause (will improvement be disregarded?)
    Section 34 LTA 1954 improvements are to be disregarded unless:
18
Q

You are managing a property for your landlord client and have received a request from a tenant to carry out improvements. The tenant has requested that improvements are registered under the 1927 Act. What advice would you give to your client?

A
  • Check whether landlords consent is required
  • Landlord can do the works and rentalise the improvements if he does the works himself
  • Ensure works do not diminish the value of the property
  • The tenant can register the improvement for compensation. - The landlord may believe that the works does not add value to the site
19
Q

How is compensation for Tenant’s improvements calculated?

A

The lesser of
- The net addition in value to the property
- The cost of doing the works at the end of the lease

20
Q

What lease terms are implied under Section 19 of the Landlord and Tenant Act 1927?

A

Where consent cannot be unreasonably withheld for assignment, sub-let, alternations or improvements.

21
Q

Explain the legislation that needs to be considered in an assignment of a lease?

A
  • S19 of L&T act 1927 (Consent not unreasonably withheld)
  • S1 L&T Act 1988 (Consent in a reasonable timeframe)
  • L&T Covenants Act 1995 (LL may require AGA)
22
Q

In what circumstances could no restriction on assignment and subletting be appropriate?

A

when trying to let particularly large properties

23
Q

What are reasonable grounds for refusing consent to assign?

A
  • Covenant strength of assignee
  • Character of proposed assignee
  • effect on rental or capital values
24
Q

What is the usual amount of an assignee’s business profit that a landlord will look for before giving consent to assign?

A

That T annual profits exceed 3x annual rent.

Footware Corporation Ltd vs Amplight Properties ltd

25
Q

What do you understand by the expression Authorised Guarantee Agreement or AGA

A
  • Landlord can require the assignor to guarantee the performance of the assignee

L&T Covenants act 1995 - S16. AGA would fall away at lease end or subsequent assignment.

26
Q

In what circumstances is it appropriate to have restrictive user classes in leases?

A
  • provides a good tenant mix
    To protect the mixture of tenants in a retail parade to ensure over competition does not result in voids
27
Q

What do you understand a conditional break clause to be?

A

An option for the tenant to terminate the lease on the break date so long as the conditions of the break are satisfied.

If conditions are not met then the break is ineffective

28
Q

What conditions are usually attached to a break clause

A
  • Arrears are cleared
  • Not in breach of the repairing obligations
  • Serves notice
29
Q

Can you give two examples of situations where it was held in court that a break notice was invalid / ineffective?

A

Osborne Assets v Brittania Life Ltd = 3 coats of paint every 5 years

Batts Cables Plc v Spencer Business Park Ltd = sent the break notice to the wrong address and name

30
Q

What are the ground which a LL can reject a S1 1938 notice

A
  • The value of the reversion has been substantially diminished
  • repair is necessary to comply with any Act
  • repair is necessary to protect another occupier
  • cost of immediate repair would be small compared to the cost of future repair
31
Q

How long does a LL have to reject a T application for improvement under 1927 act

A

3 months