Leases Flashcards

1
Q

Essential ingredients of a lease

A

Exclusive possession
Fixed term (or periodic)

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2
Q

Formalities for registering lease

A

Up to 3 years - no need or registration

3- 7 years - deed, but does not need to be registered (but can be)

Over 7 years - deed and must be registered by notice on charges register. If land is unregistered, this triggers compulsory registration.

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3
Q

What is a full repairing and insuring lease

A

Any costs of repair or insurance met by tenant, directly or indirectly.

Rent paid is clear of deduction.

Institutional landlords will insist on FRI lease

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4
Q

Key features of FRI lease

A

Rent - payable quarterly by standing order, reviewed to open market upwards only.

Insurance - LL insures and recovers premium from T.

Repair - T responsible for repairing property at own expense, but not for insured risk unless insurance payout is withheld due to T’s actions.

Service charge - LL provides services and recovers cost from T

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5
Q

When will 1 year lease from and including 10 July expire?

A

9 July

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6
Q

When will 1 year lease from 10 July expire?

A

10 july

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7
Q

types of break clause

A

Specified date or rolling break (eg any time after certain date)

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8
Q

If lease is of a whole property, what is T responsible for the repair of?

A

Interior, exterior and structural

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9
Q

If lease is of a part of a property, what is T responsible for repair of?

A

Interior only.

LL will repair common areas and recover £ from T by way of service charge

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10
Q

What is a full repairing obligation?

A

To keep premises in good repair.

If premises are not in good repair (even if they were not at term commencement date), T is responsible for repairing.

T should obtain survey

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11
Q

What is a qualified repairing obligation?

A

Keep premises in good repair but not better than they were at start of lease.

Not usually included in FRI leases. Schedule of condition should be provided

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12
Q

What should T ensure is excluded from repairing obligations when taking lease of new property?

A

Inherent structural defects, otherwise responsible for repair of any that arise during lease term

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13
Q

Rent in commercial FRI lease

A

-Expressed as yearly figure payable quarterly
- FRI lease will state rent is payable in advance of quarter, eg pay before 1 Jan for Q1
- rent will be apportioned if T takes lease part way through a quarter

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14
Q

Types of rent review

A

Stepped - increase in specified increments
Turnover rent - based on turnover
Index linked rent
Open market rent review

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15
Q

How is rent reviewed in open market rent review

A

LL and T can try to agree rent. If they cannot, appoint a specialist valuer who assumes certain matters and disregards others to reach new rent payable.

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16
Q

What happens after rent review concluded?

A

New rent documented in rent review memorandum - signed by LL and T and kept with lease

If review is before 5th anniversary of term commencement date - further SDLT may be payable

If new rent is agreed after rent review date, it is backdated