Please enable JavaScript.

Coggle requires JavaScript to display documents.

leases II - Coggle Diagram

- - - - International Drilling Fluids Ltd v Louisville Investments (Uxbridge) Ltd- basic principle to determine reasonableness of landlord’s decision- landlord is not entitled to refuse on grounds which have nothing to do with the landlord/tenant relationship (must be to do with assignee’s ability to pay rent, bad references, or damage of value to the property- must not be personal or theoretical reason)
- - - - means landlords of old leases will require an assignee to enter into a direct covenant with them to observe the tenant covenants for the duration of the lease (meaning both original and subsequent tenants can be sued)
  - - - no auto release when landlord assigns freehold reversion, landlord must apply for a release from the tenant (S6) which is generally granted but if not, landlord's can apply to the court (S8)
      - S3 provides auto transmission of benefit and burden of all landlord covenants to new owner of freehold/leasehold reversion and the benefit and burden of all tenant covenants to the assignee
      - suing a former tenant
        
        tenant likely has an auto release from S5
        
        if previous tenant provided an authorised guarantee agreement under S16 LTCA 1995 the landlord could sue the former tenant who guaranteed the obligations of their immediate successor
        
        if there is an AGA they can sue previous tenant (limited to damages as not in control of premises) or seek equitable remedies from current tenant
    - - tenant of new lease will generally obtain an automatic release from their covenants when they assign- S5. no auto release if it is an 'excluded assignment' (S11) e.g. assignment was in breach of an alienation covenant
      - when a former tenant is sued
        
        indemnity- an old tenant should ensure their assignee enters into an express indemnity covenant. former tenant can then sue assignee for breach of indemnity covenant and recoup damages
        
        if no express indemnity covenant, the assignor could claim indemnity at common law under rule in Moule v Grant
        
        Former tenant has benefit of quasi-contractual course of action under rule if one person is compelled to pay damages because of legal default of another, th former is entitled to recover damages from defaulting party (works for assignee, not sub-tenant)
  - - - forfeiture (bringing lease to a premature end)
      - debt action (landlord can only recover six years arrears) but if they cannot pay the rent they probably cannot afford damages
      - distress and commercial rent arrears recovery (distress is old- means landlord can enter upon non-payment and take goods to the value of rent owed- now abolished- replaced with CRAR) CRAR- another self help recovery only usable for commercial properties where seven days principal rent owed (cannot be used to recover service charge, insurance, etc) but does include vat and interest
    - - injunction, forfeiture, specific performance
      - damages- contractual rules apply as lease is a form of contract. breach of repair covenant measures damages to the value of loss of value to landlord's reversion
      - self help- commercial lease may contain self help clause (Jervis v Harris) which allows landlord to enter property, carry out repairs and recover the cost of doing so from the tenant as debt
- - - - peaceably re-entering (commercial premises)
      - obtaining a court order
        
        residential needs a court order S2 Protection from Eviction Act 1977, this includes mixed residential and commercial as in Patel v Pirabakaran
      - Different rules based on if forfeiture is due to non payment of rent or breach of a different covenant. The two above methods apply to both types of breach
    - - (a) landlord is aware of acts or omissions giving rise to the right to forfeit and (b) does some unequivocal act recognising the continued existence of the lease (accepting or suing for rent after breach)
      - Waiver can take place inadvertently like via landlord’s agent (Central Estates (Belgravia) Ltd v Woolgar)
      - where there is a continuing breach, the waiver only lasts until the next day the breach continues at which point the landlord can then choose to reject the rent and forfeit the lease
      - for a non-continuing breach, the waiver is permanent
      - (London and County Ltd v Wilfred sportman Ltd) each missed payment is treated as a separate breach with a separate right to forfeit
  - - - exception is weekly periodic tenancies- notice is four weeks, not one week