Assignment Flashcards
Who becomes landlord of assignee?
Same landlord
What is assignee entitled to
Exclusive possession of premises
Obliged to perform all tenant covenants
Consent required for assignment?
Absolute covenant - not allowed
Qualified covenant - only with LL consent
Fully qualified covenant - LL must act reasonably if deciding to withhold consent
Is qualified covenant upgraded to fully qualified?
Yes
When/how must LL give decision on consent
Within 28 days of having all information
In writing
Reasonable grounds for withholding consent
Assignee has unsatisfactory covenant strength
- Assignee’s proposed use would be breach of lease
- Assignee is in business that competes with LL
- If LL has a policy on different uses in different uses and assignee’s use would conflict
Unreasonable grounds with withholding consent
Personal grievance
Using consent as leverage
T has MINOR breaches of repairing covenant
Old leases - who remained liable after assignment?
Original tenant remained liable and only limited obligations passed to new tenant automatically
New leases- who is liable after assignment
Original T is released and new T becomes liable for all covenants
If lease is silent, can LL insist on AGA from outgoing tenant
Only if it is reasonable to do so
What happens if outgoing tenant gives an AGA, and the lease is subsequently assigned to another new tenant?
Outgoing T only guarantees the next tenant under AGA - if there is a subsequent assignment, the outgoing tenant’s liability ends
Assignment procedure
- T apply to LL for consent
- LL confirm receipt and check if need consent from lender. If want to proceed - LL drafts license to assign
- T deduces title and A investigates
- A raises pre-contract enquiries and searches - CPSE 1 and CPSE4
- LL ask T for undertaking for costs
- LL engross license to assign, triplicate and give one to each party to execute
- T send completion statement to A
- A raise pre-completion searches - OS1
- A draft deed of assignment - TR1
- L, T and A agree to complete license to assign via phone
- T and A agree to complete deed of assignment via phone
- A does pre-completion steps (pay SDLT and register deed of assignment if necessary), send notice of assignment to LL
Who drafts license to assign
Landlord
Who drafts deed of assignment and what form is used
Assignee
TR1
Pre- completion enquiries for assignee
CPSE1 and CPSE4 (specific to assignment of leases)
