Remedies for Breach of Leasehold Covenants

Flashcards covering the SQE1 syllabus for leasehold remedies, specifically addressing old and new leases, rent recovery (CRAR, debt), repair covenants (Specific performance, s18, Jervis v Harris), and the forfeiture process.

Old Lease

A lease granted before $1$ January $1996$ where the original tenant remains liable for the covenants for the full term under privity of contract.

New Lease

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

Authorised Guarantee Agreement (AGA)

A promise by an outgoing tenant in a new lease that it will be liable for any breaches of covenants by the incoming assignee until that assignee assigns the lease on.

Action in debt

A remedy to recover unpaid rent through the High Court or County Court, subject to a $6$-year limitation period under the Limitation Act $1980$.

Commercial Rent Arrears Recovery (CRAR)

A remedy for commercial premises that allows a landlord to seize and sell a tenant's goods to recover outstanding rent, requiring $7$ days' notice to enter and at least $7$ days' rent to be outstanding.

Section 17 notice

A default notice under the Landlord and Tenant (Covenants) Act $1995$ that must be served on a former tenant or guarantor within $6$ months of a breach if the landlord intends to recover a fixed charge.

Fixed charge

A monetary payment such as rent, service charge, or other liquidated sum specified in the Landlord and Tenant (Covenants) Act $1995$.

Overriding lease

A headlease between the landlord and a former tenant/guarantor, created after they pay a sum claimed under a section $17$ notice, making them the immediate landlord of the defaulting tenant.

Rent deposit deed

A document setting out the terms for a cash sum held as security for rent and tenant covenants, specifying when the landlord can draw upon funds.

Forfeiture

A remedy, requiring a specific clause in the lease, that allows a landlord to bring the lease to an end and regain vacant possession following a tenant breach.

Peaceable re-entry

The act of a landlord regaining possession of a property without force to effect forfeiture.

Relief from forfeiture

A court's discretionary power to allow a tenant to keep their lease after forfeiture provided they remedy the breach and pay costs.

Waiver

An act by the landlord demonstrating an intention to continue the leasehold relationship (e.g., accepting rent), which terminates the landlord's right to forfeit for a specific breach.

Specific performance

An equitable remedy available to force a tenant to comply with a positive covenant, such as a repair obligation, usually granted only when other remedies are inadequate.

Section 18 Landlord and Tenant Act 1927

A statutory provision that limits damages for breach of a repair covenant to the amount by which the landlord's reversion has diminished in value.

Leasehold Property (Repairs) Act 1938

Legislation applying to leases of $7$ or more years with at least $3$ years left, requiring landlords to notify tenants of their right to serve a counter-notice against repair claims.

Jervis v Harris clause

A self-help clause allowing a landlord to enter, perform repairs, and recover the cost as a debt, thereby avoiding statutory limits on damages for disrepair.

Section 146 notice

A statutory notice under the Law of Property Act $1925$ required for forfeiture for any breach other than non-payment of rent, specifying the breach and required remedy.

Surrender

A mutual agreement between the landlord and tenant to treat the lease as no longer in existence, typically formalised by a deed of surrender.