Novation is not strictly a transfer of rights and obligations but a discharge of the rights and obligations between contracting parties and a recreation of them with a third party (replacing an original contracting party) and one (or more) of the contracting parties to the original contract. The requirements of novation are: • consideration, and • consent A novation can be distinguished from an assignment which transfers the benefits of a party to another party without extinguishing the original contract which remains in force (with

The effect of a deed of surrender is to determine the term of the lease from the specified date of surrender. Landlord and tenant are released from obligations taking effect after, but remain liable for breaches of covenant committed before, that date. There is no recent legislation

Unless the parties agree otherwise and serve the correct notices before the lease is entered into, then where a tenant occupies premises for the purposes of a business, the lease will have the protection of Part II of the Landlord and Tenant Act 1954 (LTA 1954). Practitioners will be familiar with the fact that this means that absent to a right to forfeit it, arising as a result of the tenant’s breach of covenant, the landlord can only bring the lease to an end in accordance with the Act. When this happens, the tenant has a right to apply for a new lease and this can only be opposed by the landlord upon proof of certain grounds. When the tenancy has the protection of the Act, the tenant cannot be required to enter into an agreement, either as a covenant in the lease or in a contract which

This Q&A assumes that there is an English Will that includes a relevant election to apply English law under Regulation (EU) No 650/2012, the Succession Regulation. For general information about varying dispositions occurring on death, see Practice Note: Variation of Will or intestacy after death. A ‘deed of variation’ is the term commonly used for a document varying a disposition that occurs as a result of death, to which section 142 of the Inheritance Tax Act 1984 (IHTA 1984) and/or section 62(6) Taxation of Chargeable Gains Act 1992 (TCGA 1992) is to apply. The requirements are essentially the same under both sections. Although, this Q&A refers throughout to IHTA 1984, s 142, the same comments apply to TCGA 1992, s 62(6). IHTA 1984, s 142 does not specify that a deed must be used, only that there must

The transferable nil rate band If a person leaves their entire estate to their spouse or civil partner, by reason of the transferable nil rate band (NRB), there is a potential tax free allowance of up to £650,000 on the death of the second to die. The transferable NRB would be reduced in value if the first person to die gifted their estate to beneficiaries other than the spouse or civil partner, such as children. See generally: Inheritance tax (IHT)—overview, and Practice Notes: IHT—nil rate band (NRB) and transferable NRB and Calculating the inheritance tax (IHT) charge on death. On the death of the surviving spouse or civil partner, the executors can claim a transfer of the unused NRB from the first death. The claim and supporting documents are sent to HMRC when the inheritance tax (IHT) form 400 is submitted on the death of the surviving spouse

It is not clear whether the Q&A refers to a grant of probate or a grant of letters of administration. For the purposes of this Q&A, we have assumed there is a Will and the reference is, therefore, to a grant of probate. Timing of variations Variations may be made before or after a grant of probate. The timing of a variation is important in order to obtain certain tax advantages (see below). If a variation of a deceased person's dispositions is decided on which will reduce or eliminate the inheritance tax (IHT) liability of their estate on their death, it will be an advantage if it can be put into effect before the grant of probate, so that the lesser amount consequent on the variation having been made is payable on account when applying for the grant. An instrument of variation may be made before

Post-death rearrangements Common forms of post-death rearrangement which may be relevant in the scenario described are instruments of variation and appointments out of a discretionary trust within two years. See Practice Note: Post-death rearrangements. In order to qualify for the IHT ‘reading back’ provisions of section 142 of the Inheritance Tax Act 1984 (IHTA 1984), a deed of variation must: • be in writing • be made within two years of the deceased’s death • be made by the relevant parties • include a statement that IHTA 1984, s 142 is to apply • be made without any external consideration in money

Practice Note: Variation of Will or intestacy after death sets out the various factors and considerations relevant to deed of variations made pursuant to section 142 of the Inheritance Tax Act 1984 (IHTA 1984) and states that 'if a variation takes place within two years from the

Deed of variation A deed of variation is used to alter the effect of a Will or the intestacy provisions by passing to someone else property that the operation of a Will or the law of intestacy gives a particular person. For more information, see Practice Note: Variation of Will or intestacy

A legatee may alter the effect of a Will or the intestacy provisions by passing to someone else any property that the operation of a Will or the law of intestacy gives them. To effect a variation, all of the beneficiaries affected must execute the deed of

This Q&A assumes that no grant of representation has been issued and the executor appointed in the Will has not intermeddled in the estate. Where the sole executor and residuary beneficiary A of an estate agrees with a third party B to vary the terms of the Will, such that the residuary estate will be split and the parties have also agreed that alternative personal representatives should act in the administration of the estate, consideration may be given to including all the agreed terms in a deed of variation.

Where all of the members of the discretionary class and the default beneficiaries are all identified, aged 18 or over, are all of sound mind and they all agree, they may call for the trust to be terminated and for the trust property to be distributed or held by the trustees at the beneficiaries’ direction (Saunders v Vautier). If these conditions are met, the beneficiaries could collectively specify fresh administrative powers which are applicable to the trust property. There is an argument that such a direction which amends the administrative provisions but does not change the beneficial provisions does not create a new trust but results in the continuation of the original trust. If that is the case, the direction by the beneficiaries would not be a disposition