Q&As

Under a lease where a fee is payable by the tenant for any disposition, is a grant of an AST a disposition for the purposes of the lease? Will the requirement to pay a fee on the making of the disposition be subject to an implied requirement of reasonableness?

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Published on LexisPSL on 21/12/2015

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  • Under a lease where a fee is payable by the tenant for any disposition, is a grant of an AST a disposition for the purposes of the lease? Will the requirement to pay a fee on the making of the disposition be subject to an implied requirement of reasonableness?

Under a lease where a fee is payable by the tenant for any disposition, is a grant of an AST a disposition for the purposes of the lease? Will the requirement to pay a fee on the making of the disposition be subject to an implied requirement of reasonableness?

Absent an exception to the covenant requiring payment, it is difficult to see why the obligation would not be engaged.

Much depends, of course, upon the wording of the clause and in particular whether any term is specifically defined or is expressed to be subject to exceptions. Quite often there will be a requirement to pay a fee where a landlord has to consider an application for permission to assign or sublet. Although the Law of Property Act 1925, s 144 (LPA 1925) precludes the charge of a “fine” for the giving of consent to an application to assign or sublet, a landlord may still require the payment of a reasonable sum in respect of any legal or other expenses incurred in relation to considering

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