Procedural Steps for the Assignment of a Lease

Question 1

Since the assignor may be in breach of the assignment covenant in the lease if the L’s consent hasn’t been given by or on completion of the assignment, how do the SCs and SCPCs deal with this?

Answer 1

SCs - either party can rescind the contract by notice if the L’s consent hasn’t been granted 3 working days before the completion date, or it has been given subject to a condition that the buyer reasonably objects to.

SCPCs - if the L’s consent hasn’t been obtained by the completion date, completion is postponed until 5 working days after the assignor has notified the buyer that consent has been given. Either party can rescind by serving notice on each other but only after 6 months have elapsed since the original completion date.

Question 2

Should superior freehold title be deduced if the assignor’s lease is registered with absolute title?

Answer 2

No, there’s no need since the title to the lease is guaranteed by the LR.

Question 3

Should superior freehold title be deduced if the assignor’s lease is registered with good leasehold title?

Answer 3

Yes, since there’s no guarantee of the soundness of the freehold title. While not entitled to do so, the assignee will try to insist on deducting the freehold title because, without it, the lease may be unacceptable to the assignee or lender.

Question 4

Should superior freehold title be deduced if the assignor’s lease is unregistered?

Answer 4

Yes, in this case, the assignee is entitled to call for the lease and all assignments under which that lease has been held during the past 15 years, but not for evidence of the freehold title.

Question 5

What deed of assignment is used for registered and unregistered leases?

Answer 5

Registered leases irrespective of how long left it has to run = TR1

Unregistered lease for an assignment exceeding 7 years = TR1