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Landlord and tenant – commercial

Covenants – third parties ‘benefit’

The Contracts (Rights of Third Parties) Act 1999 has proved to be a damp squib. Whilst it is an Act of enormous potential it has largely been killed off at birth by standard contractual clauses that exclude it from applying.

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Parking – regs

As the number of vehicles increases each year, so the pressure on parking spaces grows. To what extent can L alter or change the parking arrangements, by introducing new parking regs for Ts?

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SDLT – holding over

When a business lease expires, T will often remain in occupation whilst the new lease is being negotiated. But, many Ts do not appreciate that there may be an SDLT liability during this holding-over period.

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Insurance – fitting-out

There can be insurance complications when T is doing fitting-out works to part of an existing building. For instance, suppose T has taken a lease of a floor in a large office block, and is about to enter into a Joint Contracts Tribunal (JCT) contract for the fitting-out works, which will involve some works to structural parts of the building.

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Serviced offices – exclusion clause

The CA has upheld the validity of a wide-ranging exclusion clause in serviced office contracts offered by Regus:

‘We will not in any circumstances have any liability for loss of business, loss of profits, loss of anticipated savings, loss of or damage to data, third-party claims or any consequential loss.’
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Lease renewal – no Pt 36 counter-offer!

An L who is involved in LTA 1954 lease renewal negotiations should avoid becoming involved in the pitfalls of CPR Pt 36.

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Guarantee – pitfall

An assignment of a lease can lead to a long guarantee obligation for the assignor. If a post-1995 Act lease is assigned, the assignor may become a guarantor by virtue of entering into an Authorised Guarantee Agreement (AGA) if required by the lease.

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Disclaimer – summary

When can an insolvent T disclaim its lease? The answer is that only a liquidator or trustee in bankruptcy can disclaim a lease. Thus, disclaimer does not apply if T is in administration, if a receiver has been appointed, or if there is a voluntary arrangement.

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Double value – double rent

Do not confuse ‘double value’ with ‘double rent’. The entitlement to either can arise under 1730’s(!) legislation:

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Rent – non-payment

We all know that the scope of distress is likely to be severely curtailed when Tribunals, Courts and Enforcement Act 2007 comes into force later this year. In any event, the usefulness of distress as a remedy always depends on the nature of T’s business (ie does he have sufficiently valuable assets to cover the rent? Does the stock and equipment actually belong to T – as opposed to being leased or being subject to retention of title clauses?).

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