Alterations and improvements

Alterations

Leases usually restrict the tenant's right to alter the demised premises. The purpose of the covenant is to protect the landlord from the tenant effecting alterations and additions which damage their property interests. In the absence of a covenant, the tenant is free to alter the premises within the demise. But note that there may be implied covenants, such as those concerning waste (see Practice Note: Landlord and tenant implied repairing obligations and the doctrine of waste).

Tenant covenants in modern leases are usually far more extensive and will need to be reviewed carefully for their precise effect.

Alterations outside of the demised premises

In the absence of an express right for the tenant to do works outside of the premises, a landlord has complete freedom to refuse consent to alterations outside the demise. Any alterations undertaken without consent will constitute trespass. For information on trespass generally, see Practice Note: Trespass—claims and defences.

See Practice Note: Alterations outside the demise.

Absolute covenants

An absolute covenant (that is, one that completely prohibits alterations, with no provision for consent) is a

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Latest Property Disputes News

Insolvency, declarations of trust, loan agreements, artificial asset protection, sham transactions, transactions defrauding creditors, interspousal asset transfers, change of position defence and wife’s entitlement to share of husband’s assets (Sayers v Dixon)

Restructuring & Insolvency analysis: The court held that six declarations of trust (DoTs) executed by the transferor (Mr Dixon) in favour of his wife (Mrs Dixon) constituted transactions defrauding his creditors within the meaning of section 423 of the Insolvency Act 1986 (IA 1986) and that two of them, purporting to transfer all his future assets and income to Mrs Dixon, along with an accompanying loan agreement, were shams which were void and ineffective. It set aside the DoTs and ordered Mrs Dixon to restore the value of three transferred properties (which had been converted into £551,589 cash) to Mr Dixon’s trustees in bankruptcy (trustees) together with interest of £101,726. It also ordered an account to be taken of the funds that had been transferred to Mrs Dixon or on her behalf by Mr Dixon over the seven years between the date of the DoTs and his bankruptcy. The court dismissed Mrs Dixon’s defence of change of position to the trustees’ claim for restoration, finding that even if such a defence were generally available (which is unclear), she had not acted in good faith and could not rely on it. It also dismissed her defence that, having been married to Mr Dixon for many years, she was entitled to half his assets and/or an entitlement to a share of them by virtue of a right to be maintained. Written by Jonathan Lopian, barrister at New Square Chambers, who acted for the successful claimants.

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