Landlord's consent Flashcards
(11 cards)
when is it necessary to consider whether LL’s consent is required? How do you check?
relevant where a T wants to grant a sub-lease (i.e. consent wouldn’t be necessary where the FH owner is granting a lease)
T checks by checking the terms of the lease
what are the different types of alienation covenant and what impact do they have on the ability to underlet?
o Lease silent = can underlet without consent
o Absolute = underletting prohibited.
o Qualified = underlet with consent (NB: automatically converted to fully qual.)
o Fully qualified = underlet + consent cannot be unreasonably withheld
if underletting with consent is permitted, what other limitations might be in place?
LL and T may have agreed specific circumstances when consent may be withheld or conditions for consent i.e. the underlease must mirror the headlease, reference to be given
how does T obtain consent?
T makes a formal application to LL
LL must respond within a reasonable time
when should consent be obtained?
consent should be obtained before completion (and ideally exchange) otherwise they are likely to be in breach of their alienation covenant
safest not to exchange until LL’s consent has been obtained
what is a licence to underlet and what is its purpose?
a written agreement whereby the LL gives T permission to underlet the property
it can give the LL some control and documents the terms of their agreement
who prepares the licence to underlet?
LL’s solicitor
who is party to the licence to underlet?
Head-LL, head-T and under-T will be parties
how must the licence to underlet be executed?
as a deed if it included covenants
what are the key provision of a licence to underlet?
o Granting of consent consent is often time-limited
o Direct covenant from under-T to head-LL
o Head-T to pay LL’s legal and professional costs
why might the LL want a direct covenant in the licence to underlet? What effect does this have?
Ordinarily, there is no privity of estate or contract between under-T and head-LL. Therefore, if the under-T breaches terms of the headlease, head-LL cannot sue them.
The head-LL often requires a direct covenant from the under-T that they will perform the covenants in the head (excl. rent) and underlease. This creates privity of contract between head-LL and under-T so head-LL can sue them if they breach the covenants.
