Q I AM a tenant of commercial premises and since the economic downturn it has become necessary for me to downsize the size of the premises I rent. I have found someone to whom I would like to transfer the lease.
How do I ensure that the transfer takes place as quickly and smoothly as possible?
A The most important initial step is to check the lease to ensure that assigning the lease to another person or company is allowed.
If there is a clause in the lease prohibiting any assignment then the landlord will be under no obligation to deal with any potential application for consent to assign the lease.
In the majority of cases, assigning the lease will require the written consent of the landlord and an application by the tenant to seek such consent.
The lease will specify any other requirements of the landlord.
Applications for consent needs to be clear, in writing and include sufficient information about the proposed new tenant including a trading reference and three years of audited/management accounts.
The more information that can be provided to the landlord at the outset, the quicker the landlord will be able to deal with the request.
An application for consent should include full details of whether the application is to assign the lease or underlet.
If any further information is needed from the tenant, then the landlord must be specific about what further information they require.
The landlord is obliged to ensure that an application for consent is dealt with promptly.
The Landlord and Tenant Act 1988 provides that a landlord must give consent within a reasonable period of time and must give consent except where it is reasonable not to do so. The landlord should serve the tenant with a written notice of its decision.
If a tenant considers that a landlord has breached their duties under the Landlord and Tenant Act 1988 then it can apply to the court for a declaration that the landlord is in breach and the transaction should proceed.
If a landlord is found to have breached its duties under the 1988 Act, the tenant can claim damages for losses suffered as a result of the delay in receiving consent, such as the extra rent they have had to pay because of the delay in assigning the lease.
■ Nagina Hussain is a solicitor specialising in commercial property with BHP Law in Stockton. She can be contacted on 01642-672770.
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