Remedies for Breach of Leasehold Covenants

Flashcards covering liabilities and remedies for breaches of leasehold covenants for SQE1 revision.

Old Lease

A lease granted before 1 January 1996, where the original tenant remains liable for the covenants for the full term regardless of assignment.

New Lease

A lease granted on or after 1 January 1996 under the Landlord and Tenant (Covenants) Act 1995, where the original tenant is released from liability upon assignment.

Privity of Contract

The relationship between the original parties to a lease; in old leases, this allows the landlord to sue the original tenant even after assignment.

Privity of Estate

The relationship between the current landlord and the current tenant which allows either to sue the other for breaches of covenants that touch and concern the land.

Authorised Guarantee Agreement (AGA)

A promise by an outgoing tenant of a new lease to be liable for any breaches of covenants by the incoming assignee.

Action in Debt

A High Court or County Court procedure to recover unpaid rent, subject to a six-year limitation period under the Limitation Act 1980.

Commercial Rent Arrears Recovery (CRAR)

A remedy allowing a landlord of commercial premises to enter the property and seize the tenant's goods to recover at least seven days of outstanding rent.

Section 17 Default Notice

A notice required under the Landlord and Tenant (Covenants) Act 1995 that must be served on former tenants or guarantors within six months of a breach to recover a fixed charge.

Fixed Charge

A liquidated monetary payment such as rent, service charge, or insurance rent recoverable by a landlord.

Overriding Lease

A headlease slotted between the landlord and the defaulting tenant, granted to a former tenant or guarantor who has paid a sum claimed under a section 17 notice.

Rent Deposit Deed

A legal document setting out terms for a cash sum deposited by the tenant as security, which the landlord can draw upon directly if the tenant breaches covenants.

Forfeiture

The right of a landlord to bring a lease to an end and regain vacant possession following a tenant's breach of covenant, provided the lease contains a specific clause.

Relief from Forfeiture

A court's discretionary power to allow a tenant to continue the lease provided they remedy the breach and pay the landlord's costs.

Waiver of the Right to Forfeit

An act by the landlord, such as accepting or demanding rent after a breach, that shows an intention to continue the landlord-tenant relationship.

Specific Performance

An equitable remedy granted at the court's discretion to force a tenant to comply with a positive covenant, such as a covenant to repair.

Section 18 Landlord and Tenant Act 1927

A statutory provision limiting damages for breach of repair covenants to the diminution in the value of the landlord's reversionary interest.

Leasehold Property (Repairs) Act 1938

Legislation applying to leases of seven or more years with three or more years left to run, limiting the landlord's ability to claim damages or forfeit for disrepair.

Self-help/Jervis v Harris Clause

A contractual provision allowing a landlord to enter the property, perform required repairs themselves, and recover the cost from the tenant as a debt.

Section 146 Notice

A formal notice served under the Law of Property Act 1925 before forfeiting a lease for any breach other than non-payment of rent.

Surrender

A mutual act by both landlord and tenant to terminate the lease, usually through a deed of surrender for commercial properties.