Q&As

A company secretary proposes a vote to tenants/shareholders in a retirement block to vary their leases to remove or reduce the current age restriction. What is the process to be followed where the articles of association are silent as to the type of resolution, whether a general meeting is necessary? There is no proposed draft deed of variation detailing the exact variation.

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Published on LexisPSL on 16/10/2017

The following Property Q&A provides comprehensive and up to date legal information covering:

  • A company secretary proposes a vote to tenants/shareholders in a retirement block to vary their leases to remove or reduce the current age restriction. What is the process to be followed where the articles of association are silent as to the type of resolution, whether a general meeting is necessary? There is no proposed draft deed of variation detailing the exact variation.

This Q&A raises the interplay between the rights of parties to a lease and of shareholders in a company who happen to be lessees. It is not uncommon for lessees under long leases of residential property to be shareholders of the company which either owns the freehold, manages the block on behalf of the freeholder or exercises the right to manage under the Commonhold and Leasehold Reform Act 2002. This Q&A also raises the operation of the Companies Act 2006 (CA 2006).

The leases referred to in this Q&A appear to have been drafted on the basis that they be held by people over a certain age. This might take the form of a user clause restricting the occupation of the demised premises to a person or persons who are above a certain age. This will be a term of the lease. The starting point will be that this provision cannot be altered without the consent of both parties. If the freehold reversion were held by a company, the shareholders of which were not lessees, it would not be able unilaterally to vary the terms of the lease. The position is no

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