Pre-conditions—planning permission If the pre-letting agreement (the PLA) is conditional upon one of the parties (usually the landlord) obtaining planning permission, the...
The landlord's works The pre-letting agreement ('the PLA') will set out the landlord's obligations to the tenant regarding the landlord's works. These will vary depending...
Assignment by the tenant The more important a particular tenant is to the viability of a particular development, the more likely that the landlord will insist the tenant...
An inherent defect may become apparent several years after the tenant has taken over the property. This may be long after: • the building contractor’s liability under the...
Collateral warranties The typical terms of a collateral warranty provided to a tenant by a consultant, contractor or sub-contractor deal with: • compliance with...
Rent commencement date Agreements for lease generally specify that the tenant is obliged to take the lease on, or within a short period after, certification of practical...
A developer has a far greater prospect of securing both: • development finance from a funder to fund the costs of the development works, and • a commitment from an...
Defects Defective workmanship is a feature of virtually every construction project. Very minor defects will be dealt with by a snagging list (see: Snagging list) but...
An agreement for lease with development obligations can give rise to a variety of issues, eg the right to claim an extension of time, measurement, whether...
Certification of practical completion under the agreement for lease (usually prompted by certification of practical completion under the building contract) triggers the...
Delay in completion of the developer’s works can be of far greater concern to a tenant than, eg whether the works are in accordance with the specification or the...
The tenant will appoint its own surveyor and other consultants to monitor the construction works and to represent the tenant’s interest in relation to various...
Insuring the developer’s works As between the developer and the tenant, the developer should covenant: • to ensure that the developer’s works are insured against usual...
If the developer fails to achieve practical completion by the target date set out in the agreement for lease, the tenant will expect to receive damages for the lost...
In some cases, a developer and a tenant agree that the rent under the occupational lease will be a specified figure. However, in many other cases, the annual rent is...
As-built drawings, health and safety file, etc In the context of a lease of an entire building, the tenant is likely to have both contractual and statutory liability for...
Under an agreement for lease, the tenant’s obligation to take the occupational lease only arises once the developer’s works have been completed and are fit to be taken...
Even if a specialist subcontractor is not providing any significant degree of design input in relation to its particular element of the developer’s works, it may well be...
In some respects, the only real value in any contractual duty under an appointment or obligation under a collateral warranty lies in the professional indemnity insurance...
A funder will often only agree to fund a development if it has been pre-let. The existence of the pre-let(s) comforts the developer’s funder that its lending position is...
Plans, specifications, etc In most cases, the tenant will apply its own bespoke fit-out to the developer’s finish condition in which the premises is delivered at...
Developer default Granting a tenant the right to terminate the agreement for lease in the event of default by the developer has potentially disastrous consequences for...
Contracts often provide for a condition or conditions to be satisfied before completion takes place (eg obtaining planning permission) or, in some cases,...
Contracts are often drafted on the basis that a condition or conditions must be satisfied before completion takes place (a condition precedent). Common conditions are: •...
If there is no express provision on insurance in the agreement for lease then, under open contract: • neither party is obliged to insure the property, and • risk passes...
The general rule At common law, there cannot be two agreements that cover the same ground. When a contract is completed by deed, insofar as they cover the same ground,...
While this Practice Note primarily covers commercial property matters, it also touches on residential considerations. Time is generally not of the essence for completion...
While this Practice Note primarily covers commercial property matters, it also touches on residential considerations. There is no common law requirement for a buyer to...
Repudiation of a contract occurs where one party to it communicates to the other (through words or conduct) that they no longer intend to be bound by it, usually by...
The term rescission is used to describe two very different remedies: • rescission ab initio, and • rescission for breach (or more accurately discharge by breach)...