Additional clauses of one lease referring to another lease?

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    Additional clauses of one lease referring to another lease?

    Dear All
    I am extending my lease (informally) and agreed with the landlord that it will be the same lease (not a new one). But the landlord solicitors are pushing the new lease and say that one of the other leases has a clause saying that the landlord needs to ensure that all new leases need to have substantially the same form, regulations and covenants.
    How can it be? How can one lease make it mandatory for all leases to be the same? I am reluctant to accept the new lease as the terms are not good and we would be in breech straight away.
    Any thoughts would be appreciated.

    #2
    Quite normal but you can reject any changes you don't want but you might lose your deal and have to go the formal route though they still might be able to force changes on you if lease is defective

    Comment


      #3
      If I understand correctly:

      You have a lease granted on certain terms.

      Another flat in the same building has a lease on different more onerous terms. It contains a clause which says that all future leases of the same building must be on the same onerous terms.

      The landlord's solicitor is insisting that your new lease must be on the same terms as the onerous lease because of the clause requiring future leases to be the same.

      Assuming the above to be the case:

      Section 57 of the Leasehold Reform, Housing and Urban Development Act 1993 provides, subject to specified exceptions, that on a lease extended under the Act the new lease must be on the same conditions as the old. As your renewal is informal the Act strictly does not apply. However, since you can apply for a new lease under the Act you can effectively insist on a renewal on the terms of the Act. Inform the solicitor accordingly pointing out that the statute overrides the covenant.

      Comment


        #4
        Yes, this is correct.

        The trouble is if we insist on the renewal under the terms of the Act would it not in effect be the so called formal route of extension, and entail valuations, etc....?

        This is the clause in question from another flat's lease:

        "
        To ensure that every lease of the Flats granted by the Landlord for an original term of over 21 years is in substantially the same form as this lease and contains covenants substantially the same as the Regulations. "

        Does the clause prevent the landlord from extending my lease as it is, informally? Or is it just a suggestion and he can do as he wishes anyway? If the lease was extended on our current terms (as agreed with the landlord) would it invalidate our lease or cause some other problem to us or the landlord which is why the landlord's solicitors are insisting on the new lease?






        Comment


          #5
          You may well be right that the landlord ought not to grant a lease under the informal route. However, the right to a new lease arises when a tenant serves a valid notice. Once the notice is served there is no need for the parties to follow any set procedure. They can just get on and agree terms.

          Comment


            #6
            Originally posted by aurora1 View Post
            The trouble is if we insist on the renewal under the terms of the Act would it not in effect be the so called formal route of extension, and entail valuations, etc....?
            You might end up having to make a decision as to whether or not avoiding the changes to the terms of the lease is preferably, even if this means that you potentially incur additional expense as a result of pulling out of the informal route and applying for a statutory lease extension.

            When you follow the informal route the freeholder can insist on changes to the lease and if you can't persuade them otherwise, you choice is to either accept these terms or reject the lease extension.
            If you pull out, there is nothing to stop you starting the statutory process.

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