Webcast Flashcards
What are leasehold covenants?
Terms agreed in a lease that relate to a parties obligations to each other in their capacity as landlord and tenant, example who will carry out repairs.
Give some examples of express covenants that tenants enter into?
To pay rent
Permitted use of premises
Not to assign or sublet without consent of the landlord
What does s19 of the landlord and Tenant Act 1927 state?
It implies into the contract that the landlord cannot unreasonably refuse consent to assign.
What happens if the landlord does refuse assignment unreasonably?
The tenant may assign the lease without the landlords consent and this will be an effective assignment.
What happens if the refusal of assignment is reasonable and they still go ahead?
The assignment without consent can constitute a breach of covenant for which the landlord can seek a remedy, possibly even terminating the lease prematurely.
What is contained with s1 of the Landlords and Tenants Act 1988?
It imposes a duty on landlords to reach a decision win a reasonable time and give reasons for refusing consent. This helps the tenant in determining whether the landlord is being unreasonable or not.
Give some examples of express covenants landlords enter into?
Allowing tenant quiet enjoyment of the property (Owen)
Not to derogate from his/her grant meaning you cannot give rights on one hand and take them away in the other (Aldin)
Give some examples of common leasehold covenants that could go either way?
Repair property
Insuring the premises
What is a qualified covenant against assignment?
A covenant which prevents the tenant from assigning the lease without the prior consent of the landlord.
L granted T a 3 year legal lease of a wooden building on his large estate for bird watching as she is writing a book. L knew of the purpose for which she rented it. After a year L starts to use the land next to the wooden building for quad biking and is planning to build a racecourse there. The noise is frightening the birds. Is L in breach of any covenant?
Yes a breach not to derogate from his grant. He knew the purpose of her renting and should therefore not take action which he knows will prevent her from using it in that particular way.
What do we mean by enforcement of leasehold covenants?
We are asking whether the tenant or landlord can take action against one another if they have broken a covenant theypromised.
Are leasehold covenants only beneficial to a party?
Every covenant must have a benefit and a burden.
What rules are in place to work out who can enforce a leasehold covenant and against who?
It depends upon when the lease was originally granted
- old leases granted before 1st January 1996
- new leases granted on or after 1st January 1996
L grants a 5 year lease to T. She covenants to use the flat for residential purposes only. L covenants to keep external structure in good repair. Who has the benefit and burden?
L has benefit of user covenant and burden of repair covenant. T has vice versa.
In 1994 Y granted a 21 year lease to J. J Covenanted to pay the rent monthly. In 1998 he assigned the less to N. N is in arrears with his rent and Y wants to enforce the rent covenant against him. There are 2 sets of rules for ascertaining the enforceability of leasehold covenants: the old rules and new rules. The 1st Jan 1996 is the crucial date to determine which rules apply. Which date is the relevant date for working out which set of rules to apply?
It is the date of the grant of the lease that decides which rules to apply and therefore it is 1994 and the old rules apply.
What is an old lease?
A lease granted before 1st January 1996.
Can a personal covenant be enforced?
Yes, all covenants unrelated to the land can be enforced.
If A owns the freehold estate and grants B a 10 year lease which includes a covenant that b must keep the premises in good repair, after 2 years he assigns the lease to C, 5 years later the house falls into disrepair. Who can the landlord sue?
B as stated in s79 of the LPA , the continuing liability rule, which states the original landlord and the original tenant may be liable for breaches of covenants by their successors in title for the whole duration of the lease.
If A owns the freehold estate and grants B a 10 year lease which includes a covenant that b must keep the premises in good repair, after 2 years he assigns the lease to C, 5 years later the house falls into disrepair. What is C assigns her lease to d and it is D who let’s the house fall into disrepair?
B is still liable under s79 LPA 1925 as it only applies to the original tenant.
What is an indemnity covenant?
It allows the party to recover damages in the event of having to pay out due to s79.
If A owns the freehold estate and grants B a 10 year lease which includes a covenant that b must keep the premises in good repair, after 2 years he assigns the lease to C, 5 years later the house falls into disrepair. What is the effect of entering into an indemnity covenant?
When B assigns the lease to C, C enters the indemnity covenant by which she agrees to recompense B for any money he has to pay out for her. B is still sued but C will pay this back through the indemnity covenant.
On 1995 C granted a legal lease to T. C Covenanted to keep the roof in good repair. In 1997 C sold the freehold to L. The roof has started to leak. Can T enforce the repair covenant against C?
Yes, C is the original landlord and under s79 LPA 1925 she remains liable for all breaches by successors for the whole duration of the lease.
In 1994 L granted a 25 year lease to R. R Covenanted to pay the rent monthly in advance. In 2000 R assigned the lease by deed to A and in 2010 A assigned the lease by deed to T. T is now three months in arrears. Who can L sue?
She can choose to sue R or T as R is still liable under s79 LPA as the original tenant. T is the current tenant and therefore liable.
What me is a successor in title to the lease?
Those who acquire an assignment of the lease or who buy the freehold reversion.
What is the rule in Spencer’s case?
It provides a 3 pronged test for working out if the benefit or burden has passed to the assignee.
- the lease must be a legal lease
- there must be probity of estate between the party who is suing and the party being sued
- the covenant in question must touch and concern the land
What is meant by a legal lease for working out whether a covenant has passed?
The original lease must be a legal lease and not equitable and the assignment must also be by deed in order to pass the leasehold estate to the assignee.
What is private of estate?
It simply means there must be a current relationship of landlord and tenant who are suing.
What does touch and concern the land mean?
P & A Swift Investments provides the working definition of the test:
- if it benefits the landlord only while he holds the freehold reversion, ensuring it’s not a personal benefit
- it must affect the nature, quality, mode of user or value of the land, example keep in good repair
- covenant must not be personal in nature
Can the successor in title to the original landlord use and be sued?
S141 and s142 LPA provide that successors in title of the landlord can sue and be used provided the covenants have reference to the subject matter of the lease.
