Assignment Procedure Flashcards
What is the usual first formal step in the lease assignment process for the tenant’s solicitor?
A. Apply to the landlord for consent
B. Register the lease
C. Draft the deed of assignment
D. Sign the contract
A. Apply to the landlord for consent
Explanation: Applying for the landlord’s consent is key and should happen early, as the transaction depends on it. This begins the process and allows negotiation of the licence to assign.
Who typically drafts the licence to assign in a commercial lease assignment?
A. Tenant’s solicitor
B. Landlord’s solicitor
C. Assignee’s solicitor
D. Buyer’s conveyancer
B. Landlord’s solicitor
Explanation: The landlord’s solicitor usually prepares the licence to assign, since the document is a condition of granting consent and protects the landlord’s position.
What type of document is usually used to transfer a registered leasehold interest during assignment?
A. Form AP1
B. Deed of surrender
C. Form TR1
D. Certificate of title
C. Form TR1
Explanation: For a registered lease, the deed of assignment will usually be in the TR1 form, the same as for a registered freehold transfer.
What is the purpose of a completion statement in lease assignment?
A. Calculate stamp duty
B. Register the title
C. Serve notice on the landlord
D. Divide rent and charges between the parties
D. Divide rent and charges between the parties
Explanation: The completion statement apportions items like rent and service charge between assignor and assignee based on when the lease is transferred.
Leo is buying a short lease with minimal obligations. He agrees with his solicitor to limit title investigations. What should the solicitor do?
A. Proceed without informing anyone
B. Conduct full investigations anyway
C. Cancel the transaction
D. Warn Leo of the risks in writing
D. Warn Leo of the risks in writing
Explanation: Solicitors must advise clients clearly if standard due diligence is being limited. Failing to do so risks negligence claims.
The landlord’s solicitor prepares the licence to assign. Why is it produced in triplicate?
A. One copy is required for the Land Registry
B. So the tenant can file it with HMRC
C. Each party keeps a signed original
D. To include it in the deed of variation
C. Each party keeps a signed original
Explanation: The licence to assign is signed by landlord, tenant, and assignee. Each needs an original signed version, hence three copies.
Dan is taking an assignment of a commercial lease. The lease is registered, and Dan’s solicitor wants to check that no changes have occurred before registration. What search should they carry out?
A. Local authority search
B. OS1 search
C. Bankruptcy search
D. Environmental report
B. OS1 search
Explanation: The OS1 (Official Search with Priority) checks that no other transactions have been registered and secures priority for the new registration.
Cora is assigning a commercial lease. She has already paid the full quarter’s rent in advance. The assignment completes halfway through the quarter. What will the completion statement likely show?
A. The assignee owes Cora half the quarter’s rent
B. The landlord must refund rent to Cora
C. No apportionment is required
D. The rent is suspended pending completion
A. The assignee owes Cora half the quarter’s rent
Explanation: Rent is apportioned in the completion statement. Since Cora paid in advance, the assignee reimburses her for their portion of use.
During assignment of a registered lease, whose title is searched using an OS1?
A. The landlord’s freehold title
B. The new tenant’s title
C. The previous tenant’s personal title
D. The leasehold title of the outgoing tenant
D. The leasehold title of the outgoing tenant
Explanation: The OS1 search is made against the leasehold title to ensure no recent or pending changes before registering the new leaseholder.
A solicitor provides an undertaking for costs as part of the landlord’s consent process. What is the status of this undertaking?
A. Enforceable only in equity
B. Enforceable by the client only
C. Legally binding and enforceable in court
D. Void if not signed by the client
C. Legally binding and enforceable in court
Explanation: Solicitor undertakings are serious obligations. They are enforceable in court and a breach may lead to disciplinary action by the SRA.
Why is exchange of contracts often skipped in commercial lease assignments?
A. Because deposit payments are too complex
B. Because the parties usually combine pre-exchange and pre-completion steps
C. Because it is not permitted in commercial law
D. Because it delays SDLT calculations
B. Because the parties usually combine pre-exchange and pre-completion steps
Explanation: In commercial practice, exchange is often skipped to speed up the transaction. The process moves straight to completion, once documents and consent are ready.
Which of the following is not typically part of the post-completion process in lease assignment?
A. Sending draft contract to the landlord
B. Serving notice of assignment
C. Registering the lease (if required)
D. Filing SDLT or LTT return
A. Sending draft contract to the landlord
Explanation: The landlord is not normally a party to the contract and does not need to see it. Post-completion steps include notice, tax return, and registration.
