Q&As

If a company voluntary agreement (CVA) has been approved and implemented and a landlord has given notice under the CVA to determine a lease, can the lease then be varied or does a new lease have to be granted?

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Published on LexisPSL on 16/03/2021

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

  • If a company voluntary agreement (CVA) has been approved and implemented and a landlord has given notice under the CVA to determine a lease, can the lease then be varied or does a new lease have to be granted?

If a company voluntary agreement (CVA) has been approved and implemented and a landlord has given notice under the CVA to determine a lease, can the lease then be varied or does a new lease have to be granted?

See Practice Note: Property law aspects of Company Voluntary Arrangements (CVAs), at section Options to determine.

A CVA may give a landlord whose rights have been compromised in the CVA the right to terminate the affected lease. How this is achieved, and its effect, will be a matter of interpretation of the CVA and the lease. However, some general principles are explained in the Practice Note, including that:

  1. the termination right will usually operate by requiring the landlord to serve notice within a given timeframe

  2. the landlord may be required to specify the method of termination to be used (for example, surrender or forfeiture)

  3. if the lease is to be surrendered, the parties should be obliged to enter into a deed of surrender (but note the Commentary in the Practice Note about the issues if the lease has security of

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