Lease renewal aga

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    Lease renewal aga

    Hi I'm in the process of lease assignment with a aga.

    The lease will be due for renewal after 1 year. My question is will my aga stop once the lease is renewed?

    #2
    Yes the aga should lapse once the original lease ends.

    See 'How long does it last?' in the following link.

    https://www.ashfords.co.uk/news-and-...-a-tenant-know

    Comment


      #3
      Yes and no.

      (1) Although the AGA in the existing lease will lapse on expiry of the contractual term, it is necessary to check the lease definition of "term"'.; In modern leases, term could include any statutory holding-over / continuance.

      (2) With a lease renewal, it is usual (presupposing the first tenant properly advised) for the lease to enable the landlord to require an AGA only 'if reasonable to do so'. Whether the wording of the AGA is in the renewal lease or drafted if and when the AGA is entered into would depend upon what the parties agree when drafting/approving the renewal lease.

      What "if reasonable to do so" means depends upon the circumstances at the time; and case-law. The test of 'reasonable' is objective, To quote from Landlord Protect Ltd v Dolman and others [2006] " Each case turns on its own facts." "Being a landlord may be a risky business, and many risks are difficult to foresee, but it is perfectly reasonable for a landlord that sees a clear risk to seek to avoid it and to cast the risk of the claimant's insolvency on the very man who protests that the claimant will have no difficulty in paying.”

      (3) The Code for Leasing Business Premises in England and Wales 2007 is not mandatory. Whether a landlord wants the renewal lease to comply with the Code is discretionary.




      Comment


        #4
        I'm slightly confused sorry, so as the existing tenant I assign my lease to a new tenant with landlords consent and all referencing and aga and deposit(from new tenant).

        1 year after I have assigned the lease the lease term has expired assuming the now new tenant signs a new lease with the landlord, the old tenants (me) responsibility under aga ceases. The only time it doesnt cease is if a new lease is not signed and the existing lease becomes a rolling periodic lease. Is my understanding correct?

        Comment


          #5
          "Hi I'm in the process of lease assignment with a aga. The lease will be due for renewal after 1 year. My question is will my aga stop once the lease is renewed?"

          It is not clear from your op that you are the existing tenant. I read the op to mean that you are to become the tenant of a lease with an aga and are asking whether on renewal the aga would continue.

          Now that you say it is you that is assigning, the answer is yes. Your responsibility under the aga that you are entering into will cease when either your successor assigns the existing lease or the existing lease ends (including any holding-over period) or is renewed to your successor assignee.

          Comment


            #6
            " The Authorised Guarantee Agreement shall take effect on the date the Tenant is released from the tenant covenants of the Lease by virtue of the Landlord and Tenant (Covenants) Act 1995, and shall continue until the end of the term of the Lease (however it may end), or until the Assignee is released from the tenant covenants of the Lease by virtue of the Landlord and Tenant (Covenants) Act 1995, if earlier."

            What would the (however it may end) mean?

            Comment

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