The dissolution of a limited company results in its property (which includes leasehold interests) vesting in the Crown as bona vacantia. Bona vacantia is administered by the Treasury Solicitor. The Crown will decide whether to disclaim the property under section 1013 of the Companies Act 2006 (CA 2006) within a period of three years, which has the effect of terminating the lease. CA 2006, s 1015 provides that disclaimer operates to determine from the date of the disclaimer the rights, interests and liabilities of the company in respect of the property disclaimed. Many commercial leases contain provisions dealing with the insolvency or dissolution of a tenant. Where there

Although the supervisor of a company voluntary arrangement (CVA) will be an insolvency practitioner (and their role is to ensure that the proposals accepted by the majority of creditors at the creditors meeting are implemented) the powers of the directors in relation to the day to day management of the company will continue. Thus, where the company subject to the CVA is a tenant of business or other premises, and wishes to assign the lease, the landlord should deal directly with the directors. Entry into a CVA by a tenant

The term 'reversionary lease' is often used to describe a lease with a term that commences in the future (also known as a future lease), though the term more properly describes the situation where there is an existing lease and the new lease takes effect only when the existing lease expires. This device is often used to in effect extend the term of a lease, though in fact a new lease is granted, usually on the same terms. However there is nothing to prevent parties from entering into a lease which has a commencement

In relation to commercial tenancies, there is no statutory requirement for a deposit to be protected in the manner that is prescribed for many residential tenancies by the Housing Act 1996. The parties to a commercial lease may agree to enter into a rent deposit deed, which is an agreement under which, when a deposit is paid pursuant to the lease, the landlord agrees to place it into an account (usually interest bearing) and to hold the deposit on trust during the term, subject to the security

Forfeiture Where a lease allows a landlord to do so, the landlord can bring the lease to an end in the event of a default by the tenant by forfeiting the lease. Waiver of the right to forfeit Where a tenant is in some way in default, the landlord is not obliged to forfeit the lease; instead they have the power to do so if they wish. It follows that when the tenant does something or fails to do something which places them in default, the landlord has a choice: either to forfeit the lease (and thus bring it to an end) or to waive the default and thereby allow the lease to continue. The distinction

A lease may contain an option to renew, giving the tenant the right to demand a further term on expiry of the existing one. An option to renew is usually subject to conditions, including at least the service of notice, and any conditions must be complied with strictly. A lease may also benefit from the security of tenure given by the Landlord and Tenant Act 1954 (LTA 1954). Where a tenant wishes to obtain a new lease under LTA 1954, it may serve a request under LTA 1954, s

In this scenario, it appears that works have been carried out in respect of a part of the property not included within the demise without the consent of the landlord, by the removal of an internal wall. Such action amounts to a trespass to the retained property and is actionable in damages or an injunction to restore the internal wall. Assuming that the landlord is content that the internal wall has been removed, and there are no issues relating to building regulations or planning permission, the landlord could seek to regularise the position. It is not clear what the purpose of removing the internal wall is, as the extent of the demise has not been altered, but it could be, for example,

When a tenant applies for a new lease under the Landlord and Tenant Act 1954 (LTA 1954), it is required to set out (among various other things) its proposed terms for the new lease. The tenant is only entitled to a new lease of the 'holding' (that is, the part of the premises that it occupies for business purposes). Although the landlord is entitled to require that the new lease comprises the whole of the property demised by the current lease, the landlord does not need to make its election until filing the

The Leasehold Reform, Housing and Urban Development Act 1993 (LRHUDA 1993) provides for tenants of certain types of flats to request an extension to their lease. This Q&A considers the provisions under LRHUDA 1993 allowing for the landlord to recover costs associated with the lease extension, in particular the cost of a valuation of the lease extension. The process for applying to extend a lease under LRHUDA 1993 commences with the tenant serving a tenant’s Notice on the landlord pursuant to LRHUDA 1993, s 42. From the service of the tenant’s notice, the tenant becomes responsible for the ‘reasonable’ professional fees of the landlord, such as legal fees and valuation costs, regardless of whether the tenant ultimately proceeds to extend the lease. The tenant’s notice must include a proposed

AGA An authorised guarantee agreement (AGA) is a form of guarantee given by an outgoing tenant who guarantees some or all of the obligations of the incoming assignee under a lease (section 16 of the Landlord and Tenant (Covenants) Act 1995 (LT(C)A 1995)). The precise terms of the AGA will be a matter for negotiation and are subject to certain restrictions imposed by LT(C)A 1995. It would be usual for the AGA to include a guarantee that the assignee will perform most, if not all, of the tenant covenants under the lease, including any obligation to pay the rent. Where the lease includes a rent review, the tenant covenants in the lease will include an obligation to pay the rent falling due under the lease as reviewed from time. This is therefore

There is no legal restriction per se on backdating a term commencement date to before the date of grant. However, you may wish to take care that this does not create unintended consequences elsewhere in the lease and any other agreements. Such consequences could include: • a different interpretation of repair and reinstatement covenants, based on any change in the character of the premises, or the state of fit-out or other alterations

In the absence of an express provision in the lease, it has been held at first instance in the case of PGF II SA v Royal and Sun Alliance Insurance plc that the costs incurred by the lessor in consulting a solicitor and surveyor in respect of the preparation of a schedule and any necessary notice may be claimable as damages at common law, subject to the statutory cap under section 18(1) of the Landlord and Tenant Act 1927 (LTA 1927)—as stated by HHJ Toulmin CMG QC: ‘…340. I have considered carefully the issue of law both in relation to the Authorities and the textbooks. I cannot see any reason of principle as to why a reasonable sum should not be recoverable from a tenant for serving a Schedule of Dilapidations at the end of a lease. The Schedule