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What is the liability of an outgoing tenant under an 'old' lease following assignment? Is a landlord obliged to pursue the current tenant for any arrears before pursuing a former tenant or guarantor to a former tenant?

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Published on LexisPSL on 08/05/2017

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

  • What is the liability of an outgoing tenant under an 'old' lease following assignment? Is a landlord obliged to pursue the current tenant for any arrears before pursuing a former tenant or guarantor to a former tenant?
  • Obligations of an assignor tenant under an old lease
  • Who should be served?

What is the liability of an outgoing tenant under an 'old' lease following assignment? Is a landlord obliged to pursue the current tenant for any arrears before pursuing a former tenant or guarantor to a former tenant?

Obligations of an assignor tenant under an old lease

The general rule is that where the lease is an old tenancy, the original tenant remains liable for the tenant covenants throughout the term of the lease, even if it has assigned its interest.

However, there are some exceptions:

  1. the tenant will not be liable for any obligation arising from a variation of the lease made without its consent following assignment, unless the variation was anticipated under the terms of the original lease, eg an increase in rent under the rent review clause. (See Friends’ Provident Life Office v British Railways Board, and section 18 of the Landlord and Tenant (Covenants) Act 1995 (LT(C)A 1995)

  2. an assignee of an old tenancy is liable for those tenant covenants that touch and concern the land for as long as the lease remains vested in the assignee (privity of estate). The assignee's liability is usually extended by a direct covenant with the landlord to comply with all of the tenant covenants for the remainder of the term

  3. the original tenant’s liability does not continue following assignment where

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