Lock-up clause meaning

This Checklist offers a proposed set of key points to weigh up when assessing whether a construction agreement—be that a building contract, a consultant appointment or a collateral warranty—can be assigned. It also sets out the practical steps to be taken to complete an assignment of the benefit of a construction contract from one party to another. Does the construction contract contain assignment provisions? Construction agreements commonly include an explicit clause addressing the parties’ rights to assign under it. Where the contract says nothing about assignment, either side may assign the contract without limitation or constraint. In some cases, the contract will expressly bar assignment by one or both parties. Usually, the employer is not wholly barred from assigning; however, there is often a cap on how many assignments can occur without the other party’s consent (see further on restrictions below). See Practice Note: Assignment in construction contracts. Are there any restrictions on the right to assign? Construction...

Withholding tax is a key concern relating to loans. The objective is to ensure no withholding tax arises on interest, thereby avoiding the administrative burden and cost linked to withholding tax. For further detail in this area, see Practice Note: Tax considerations on a loan agreement—the tax gross up clause—a borrower problem. Loan documentation is typically prepared on terms favourable to lenders. That tendency is especially marked for syndicated loan facilities. Such contracts are generally structured for straightforward transfer between lenders and commonly follow, or are derived from, one of the model loan facility agreements of the Loan Market Association (LMA). For an explanation of the rationale for gross-up clauses in loan agreements, see Practice Note: Tax considerations on a loan agreement—the tax gross up clause—Why have a tax gross-up?...

Compulsory liquidation Provide a certified court interlocutor ordering winding up and naming the liquidator, plus certified proof of appointment: creditors’ resolution, contributories’ resolution with the liquidator’s certificate on the creditors’ meeting, or a court order. Creditors’ voluntary liquidation Include a certified general meeting winding‑up resolution and either the creditors’ resolution appointing the liquidator or a court order. If moving straight from administration, add a certified, administrator‑signed and Companies House‑stamped form 2.25B (Scotland). Members' voluntary liquidation Supply a liquidator/secretary certificate that a solvency declaration was filed, and a certified general meeting resolution appointing the liquidator. Checking the appointment Irregularities do not invalidate acts, but absence of appointment does—so verify appointment and any limits on Schedule 4 powers; in compulsory cases powers are court‑controlled and creditors or contributories may apply. Joint liquidators Confirm power to act severally; otherwise all must execute sale documents. ...

FORTHCOMING CHANGE : The Renters’ Rights Act 2025 obtained Royal Assent on 27 October 2025. For insight into how it affects residential tenancies in England, refer to Practice Note: Renters' Rights Act 2025—key provisions. This Flowchart outlines the steps for ending an assured shorthold tenancy (AST) under section 21 of the Housing Act 1988 (HA 1988) via the standard possession route, covering when to serve a section 21 notice, when to issue proceedings, and the procedural milestones up to a possession order. Where HA 1988 governs, unless the tenant chooses to leave of their own accord, a landlord may regain possession only by following the mechanisms in HA 1988, ss 8 or 21, securing a possession order and enforcing it. For more detail, see Practice Note: Assured and assured shorthold tenancies—terminating. Under HA 1988, s 21, a landlord may terminate a fixed-term AST by giving the tenant no less than two months’ written notice, exercising a break clause during the term, or at the end of, or after the...

In the 2025 Budget, the government set out a package of VAT changes for UK firms that need to be grasped and prepared for before their 2026 launch. They affect how businesses set prices for PHV services. From 2 January 2026, VAT-registered PHV and taxi operators that enter into direct contracts with customers must add 20% VAT to the entire fare, as they will be expressly carved out of TOMS; see clause 79 of the Finance Bill 2026 (as introduced). In London, regulation already requires operators to contract directly with customers as a licensing requirement. In other regions, the position depends on how agreements are set up. What will this mean for operators and customers? At present, most private hire and minicab drivers who deal directly with passengers do not have to levy VAT on passenger fares. Typically this is because these drivers—many earning below the £90,000 per annum VAT registration threshold—are treated as self-employed contractors...

Banking & Finance—July 2025 case round-up Ciddy Ltd v Natalia [2025] EWHC 1616 (Ch) Loan agreement—unenforceable penalty clause The Chancery Division dismissed the bankruptcy petition presented by the petitioner, Anjana Natalia, against the debtor, Ms Ella Vacani. The petitioner sought to recover £657,516.32 said to arise from a loan contract, asserting that the debtor, a professional accountant, had taken legal advice before signing. The debtor, by contrast, maintained that the parties’ relationship was unfair because of unequal understanding, coercive control exerted by her husband, and an excessive default interest rate that, she said, constituted an unenforceable penalty clause. The court identified substantial grounds to challenge the petition, grounded in the debtor’s allegations of an unfair relationship under the Consumer Credit Act 1974 and a penalty default term within the agreement. It held that the issues concerning default interest and unfairness were not fanciful and ought to be determined by the County Court. Accordingly, any sums due to the petitioner, if any, remain to be established in separate...

In this issue: Corporate insolvency processes Personal insolvency Insolvency litigation Property insolvency Daily and weekly news alerts Key dates for R&I professionals New content Corporate insolvency processes No triable issue raised over settlement reached by former director (Re Windrush Alliance UK CIC) The court found that Windrush Alliance UK CIC (the company), a social housing provider, failed to show a real and substantial dispute capable of justifying the setting aside or striking out of the winding-up petition brought against it. The core concern was that the current directors appeared to be bound by a settlement agreement concluded by a former director. Complaints about that director’s conduct, and any contraventions of the regulatory regime attaching to the business, were irrelevant to the question to be determined at the hearing of the petition. There was no reason to reopen the settlement’s terms; a restriction in the company’s Articles of Association did not undermine its validity; and...

This Practice Note highlights the principal points to weigh up when acting for an outgoing tenant and advising on the assignment of a rack rent (occupational) commercial lease. See also Practice Note: Transferring commercial property—a practical guide, together with the Assignment of a rack rent lease (assignor)—checklist. Is the landlord’s consent required to the assignment? Carry out the following checks in sequence, in particular: Carefully scrutinise the lease terms, together with any deeds of variation and, where necessary, any other supplemental documents. If the lease is registered and contains HM Land Registry prescribed clauses, the register will confirm whether or not the lease includes provisions that restrict or prohibit dispositions, as shown by clause LR8 of the lease. Consider whether a restriction has been entered on the title expressly barring assignment without the landlord’s consent. Where relevant, review any superior lease carefully to establish if assignment is constrained—for example, a prohibition on assigning an underlease without consent...

Negotiation Guide This Negotiation Guide sits within the Practical lease negotiation collection. See also Practice Note: New starter guide—entering into new commercial leases. An alterations clause sets out how far (if at all) a tenant may undertake alterations to the demised premises. Contemporary commercial leases usually separate alterations into: prohibited alterations alterations allowed with the landlord’s consent alterations allowed without the landlord’s consent If, unusually, the lease contains no alteration restrictions, the tenant may carry out any alterations to the demised premises. More often, commercial leases impose a general ban on alterations, with carve-outs for defined categories of works (eg internal non-structural changes) that may proceed either with, or without, the landlord’s prior consent. Drafting by exception in this manner helps to minimise confusion and reduce the risk of future disputes. The scope of permitted alterations—and any conditions attached to them—is shaped by the nature of the premises, the duration of the lease and the landlord’s plans for...

Background The London Chamber of Arbitration and Mediation (LCAM) is a London-based institution that delivers administrative support for resolving disputes. It operates under the auspices of the London Chamber of Commerce and Industry (LCCI), as part of LCCI’s longstanding commitment to arbitration and dispute resolution work. Founded in 1882, LCCI set as one of its stated aims the undertaking of arbitration and the settlement of disputes arising from trade, commerce, or manufacture. While LCAM might look like a comparatively recent addition, it is in reality a revival of the arbitration scheme created by LCCI in 1903, then known as the London Chamber of Arbitration. The City of London Corporation endorsed that scheme, and the Institute of Arbitrators also took part in its management. Up to 28 November 2016, by-law 6.01 of the London Chamber of Commerce stipulated that disputes brought to the Chamber for arbitration were to be treated as references to arbitration under the LCIA Rules. Only a limited number of arbitrations were directed to LCIA arbitration under...

TO WHOM IT MAY CONCERN FROM: [ insert name of landlord ], of [ insert landlord’s address ] (the ‘Landlord’) PREMISES: [ insert full address of the Premises ] LEASE: a lease relating to the Premises dated [ insert date of lease ], entered into between [ insert names of original parties to the lease ] Today, the Landlord has exercised rights of re-entry to the Premises in accordance with clause [ insert forfeiture clause number ] of the Lease and the locks have been changed. With effect from today, the Lease is forfeited and therefore at an end. If you have any enquiries concerning the Premises or any items remaining within it, please contact [ insert name and address of landlord or its managing agent ]. Date: Signed: [ insert name of Landlord/agents acting on behalf of Landlord ] [ for and on behalf of the Landlord ]...

1 Definitions Within this clause [ 1 ] the following meanings apply: Contaminated Land Regime • Part IIA of the Environmental Protection Act 1990, as amended from time to time, and the Statutory Guidance Contamination • the existence or build-up of any Hazardous Substances at, in, on or under the Property [ at or prior to the Completion Date ] [ at any time whether before or after the Completion Date ] Environment • any or all of the following media, namely air, land, water (including surface water and groundwater) and any living organisms (including man) or systems sustained by those media Environmental Law • all applicable laws, statutes, secondary legislation, common law, directives, regulations, codes of practice and guidance notes that have legal effect [ and are in force at the Completion Date ] in ...

This Deed of dissolution is entered into on [ insert date ] Parties Each individual whose name and address appear in Schedule 1 (each a Partner and, collectively, the Partners named therein). Background: The Partners have conducted and managed the Business in partnership in accordance with the terms of the Partnership Agreement. The Partners intend to dissolve and wind up the Partnership [ as contemplated by clause [ insert clause number ] of the Partnership Agreement ] on the basis set out in this deed. AGREED TERMS: 1 Definitions and interpretation 1.1 Except where expressly stated otherwise in this deed, the definitions and rules of interpretation in the Partnership Agreement shall govern...

This Q&A assumes that the employee is employed on a permanent employment contract, rather than a temporary employment contract. If the employee is on a permanent contract that specifies term-time only hours, their employment still clearly continues throughout the holidays up to the relevant termination date. Under this type of arrangement, pay for the weeks worked during term time, together with any holiday pay, is usually, in practice, distributed or averaged out over the entire 12 months. See, for instance, clause 2 of Precedent: Clauses—term-time working...

It is assumed that the landlord has instituted proceedings to forfeit the lease due to non-payment of rent. Given the claim has succeeded, it is further assumed the lease contained a clause authorising re-entry upon non-payment of rent, and that either the arrears were duly demanded or section 210 of the Common Law Procedure Act 1852 applies, with at least six months’ rent outstanding and insufficient distress available on the premises to satisfy the arrears, in which situation any demand is dispensed with. There is likewise no requirement to serve a notice under section 146 of the Law of Property Act 1925 where the breach relied upon is non-payment of rent. In matters of forfeiture for non-payment of rent, as in this instance, relief is exercised under the equitable jurisdiction of the courts, and any relief is considered, granted or refused strictly within that jurisdiction and on equitable principles alone...