Legal Q&A

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......

Do the normal set-off rules apply to an LLP in administration? The Limited Liability Partnerships Act 2000 ( LLPA 2000) created limited liability partnerships ( LLPs) and is intended to be considered alongside the Limited Liability Partnership Regulations 2001 ( LLPR 2001), SI 2001/1090. Through these Regulations, the Insolvency Act 1986 ( IA 1986) and the Insolvency ( England and Wales) Rules 2016 ( IR 2016), SI 2016/1024 are applied to LLPs accordingly......

In partnership with Alexander Stewart of Hogarth Chambers If a limited liability partnership ( LLP) becomes insolvent, the preferred view is that members’ entitlements to amounts due under their capital and current accounts are subordinated to the claims of external unsecured creditors. That said, it can be contended that members’ claims for advances or loans made to the LLP—despite being entered in their current accounts—stand on the same footing as those of external unsecured creditors. LLPs are established by the Limited Liability Partnerships Act 2000 ( LLPA 2000). In several respects, including insolvency, LLPs are akin to limited companies rather than partnerships; see: Limited liability partnerships ( LLPs) and insolvency—overview. Where an LLP is insolvent, it is terminated by voluntary or compulsory winding-up. The winding-up regime under the Insolvency Act 1986 ( IA 1986) operates alongside LLPA 2000, s 14 and the Limited...

Service of a notice to quit/notice to end the licence was not required. The lodger/licensee occupied solely by way of goodwill. No periodic licence was ever created or granted......

If a lease was granted at undervalue, you are the 3rd owner, and you knew it was at undervalue, if creditors ask for an order returning the property to the original owner you cannot claim relief? Transactions at an undervalue ( TUVs) are regulated by the Insolvency Act 1986 ( IA 1986). The relevant provisions are: sections 238, 240 and 241 of the IA 1986 for companies sections 339 to 342 of the IA 1986 for individuals These powers are available to trustees in bankruptcy, liquidators (in both compulsory and voluntary liquidations), and administrators. They permit the office-holder to review dealings made by the insolvent person or company in the lead-up to insolvency and to assess whether assets should be recovered for the insolvent estate. In particular, an order under: section 241 of the IA 1986 (for companies), or section 342 of the IA 1986...

Case study A landlord serves a section 25 notice under the Landlord and Tenant Act 1954 ( LTA 1954), ending the lease on the contractual expiry date and contesting any renewal on ground f. No claim has yet been brought. It is expected, however, that the tenant will start renewal proceedings, without making an interim rent application. The landlord has issued an invoice for the yearly rent, which the lease stipulates is payable in advance, covering the year commencing on the contractual expiry date... Assume for this Q& A that the tenant does issue proceedings, so the lease carries on beyond the contractual expiry date and the tenant stays in occupation, preserving protection under LTA 1954, Pt II... Further assume the parties remain in discussions about whether the tenant will vacate on the notice expiry, and that the lease requires rent to be paid...

Where a long residential lease is extended under section 56 of the Leasehold Reform, Housing and Urban Development Act 1993 ( LRHUDA 1993) and the freehold is subject to a Form N restriction in respect of a charge to the freeholder’s lenders, will the HM Land Registry require lender consent to be submitted in order for the lease extension to be registered notwithstanding that the lease extension is pursuant to statute? A restriction entered on the register indicates that the proprietor’s power to deal with the land is constrained in some manner. Its practical effect is either to bar registration of a disposition, or to oblige the applicant to satisfy specified requirements before registration can proceed, for example by producing evidence of consent from the person entitled to the benefit of the restriction. A restriction may apply to every...

Leasehold Reform, Housing and Urban Development Act 1993, Chapter II ( LRHUDA 1993) Chapter II of the Leasehold Reform, Housing and Urban Development Act 1993 ( LRHUDA 1993) specifies process for exercising right to obtain a new lease......

Case study A one-year fixed term assured shorthold tenancy ( AST) was initially granted, ending in February 2015. With the fixed term concluded, a statutory periodic tenancy has commenced. The landlord fears they might have failed to comply with duty to supply prescribed information; can they issue a section 21 notice to bring the statutory periodic tenancy to a close? Since the term expired, the tenancy continues on a statutory periodic footing. How to rent checklist The obligation to provide the publication ‘ How to rent: the checklist for renting in England’, issued by the Department for Housing, Communities and Local Government, arose under Deregulation Act 2015 ( DA 2015). However, amendments introduced by that Act do not extend to fixed term ASTs granted before 1 October 2015, even where agreements roll into a statutory periodic tenancy after 1 October 2015. This remains the stated...

Damages After the lease ends, a landlord’s terminal dilapidations claim lies in damages. The recoverable sum is determined by common law rules for assessing loss arising from breach of the repairing covenant, but is curtailed by the statutory ceiling in section 18(1) of the Landlord and Tenant Act 1927 ( LTA 1927). At common law, the benchmark for disrepair is the reasonable expenditure required to restore the premises to the condition they should have been in at the point of lease expiry. The claim for damages may, in addition, encompass foreseeable knock-on losses, including rent foregone during any period when the state of disrepair prevents the property being relet......

The Landlord and Tenant ( Covenants) Act 1995 ( LTCA 1995) The LTCA 1995 does not extend to “old tenancies”, that is, those granted before 1 January 1996. Consequently, where the sale contract is silent on the matter, the entitlement to pursue the tenant for pre-completion rent arrears in respect of such “old tenancies” automatically passes to the purchaser with the transfer of the reversion (see the Law of Property Act 1925, s 141; Claims to the Possession of Land, paragraph B4.2; and Hill and Redman, Division A, Chapter 4, paragraph 1087). That entitlement is a chose in action, which can be expressly reassigned to the seller......

If the landlord and tenant cannot agree the terms of a renewal lease, either party may then apply to the court so that the court can determine those terms under section 24(1) of the Landlord and Tenant Act 1954 ( LTA 1954)......

For the purposes of this Q& A, it is assumed the roof is not demised to the tenant and that the tenancy is in writing. The respective obligations of landlord and tenant for roof repairs will be dictated by the lease terms. Repair Leases typically place responsibility on the landlord to repair retained parts. In the commercial context, absent an express covenant, the landlord gives no assurance that the premises are, or will remain, physically suitable for the intended use, and is not obliged to undertake repairs except those required by common law or statute. Neither of these imposes particular fitness obligations on a landlord of business premises towards a tenant simply by reason of the landlord and tenant relationship......

A tenant’s obligations A tenant is under an implied duty to use the rented premises in a tenant-like manner. In Warren v Keen, the Court of Appeal (per Denning LJ) described this as taking proper care of the home and doing the small tasks a reasonable tenant would attend to. Frequently, tenancy agreements include express terms about how the property is to be used and any duties to keep it in good repair; these express provisions supersede the implied obligation. In addition, a tenant owes a tortious duty under the doctrine of waste, meaning they must not do, or fail to do, anything that brings about a permanent alteration to the property’s nature. Removing fixtures Allowing the property to fall into decay A landlord’s remedy once the tenancy has been determined Where a tenant has failed to meet their repairing obligations, the landlord is entitled to claim damages even after the...

Forfeiture Forfeiture is the landlord’s entitlement to terminate a lease due to a tenant’s breach. A landlord can only bring the tenancy agreement to an end by forfeiture where: there is an express right within the lease; that is, the tenancy agreement includes a forfeiture clause permitting the landlord to forfeit in relation to the tenant’s alleged breach......

Where a tenant breaches a keep open clause, a landlord’s principal remedy is damages, in the ordinary course of things, rather than an injunction, specific performance, or forfeiture. Courts are ordinarily disinclined to oversee compliance with keep open clauses, since they regard compelling a tenant to meet this duty as more burdensome and expensive than any loss incurred by the landlord......

A company becomes dissolved (or treated as dissolved) after liquidation, administration, or its name being struck off the register by the Registrar of Companies. Once dissolved, the company ceases to have any existence. Upon dissolution, any assets and rights owned by, or held on trust for, the company immediately before dissolution are regarded as bona vacantia and pass to the Crown (or to the Duchy of Lancaster or the Duke of Cornwall if the company’s registered office was in Lancaster or Cornwall, respectively)......

Section 2 of the Landlord and Tenant Act 1987 ( LTA 1987) Section 2 of the Landlord and Tenant Act 1987 ( LTA 1987) states that a person is the landlord if they are (a) the direct landlord of the qualifying tenants of flats in the premises, or (b) where any such tenant is a statutory tenant, the person who, but for that statutory tenancy, would have the right to possession of the flat. Consequently, the relevant landlord is usually the immediate landlord of the qualifying tenants, so a transfer of a superior interest is generally outside scope. Intermediate headleases are often used to avoid the regime. However, s 2(2) LTA 1987 provides that where the immediate landlord is also a tenant of the premises under a tenancy that is either: a term under seven years, or a term exceeding seven years, but...

It turns on the presence of a fair wear and tear exclusion in the lease and, if present, the way it is interpreted and applied. In principle, a carve-out for damage arising from fair wear and tear means that the tenant is not responsible for loss resulting from normal use of the premises and the ordinary action of natural elements......

Section 21 of the Landlord and Tenant Act 1985 ( LTA 1985) Under section 21 of the Landlord and Tenant Act 1985 ( LTA 1985), a residential tenant may require their landlord to furnish a summary of costs relating to service charges for the last accounting year; if accounts are not kept by accounting years, the previous 12 months. The landlord is obliged to comply with the tenant's request within one month, in any event, or, if later, within six months of the end of the relevant 12‑month accounting period......