The High Court judgment in Keydon Estates Ltd v Western Power Distribution (South Wales) Ltd [2004] EWHC 996 (Ch) concerned the issue of whether a landlord was entitled to appeal from an arbitrator’s decision.
The facts around which the case revolved, however, serve as a useful reminder of the principle that the grant of an underlease for a term that is equal to, or greater than, the residue of the tenant’s own term operates as an assignment of the tenant’s lease – and not as an underlease.
The landlord could find that the tenant has divested itself of its lease, and has ceased to be liable for the rent payable under that lease, if the lease is a “new” one for the purposes of the Landlord and Tenant (Covenants) Act 1995. But, if the assignment is unlawful, the tenant will remain liable, because unlawful assignments constitute “excluded assignments” for the purposes of the Act.
Allyson Colby is a professional support lawyer at Wragge & Co LLP.
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The High Court judgment in Keydon Estates Ltd v Western Power Distribution (South Wales) Ltd [2004] EWHC 996 (Ch) concerned the issue of whether a landlord was entitled to appeal from an arbitrator’s decision.
The facts around which the case revolved, however, serve as a useful reminder of the principle that the grant of an underlease for a term that is equal to, or greater than, the residue of the tenant’s own term operates as an assignment of the tenant’s lease – and not as an underlease.
The landlord could find that the tenant has divested itself of its lease, and has ceased to be liable for the rent payable under that lease, if the lease is a “new” one for the purposes of the Landlord and Tenant (Covenants) Act 1995. But, if the assignment is unlawful, the tenant will remain liable, because unlawful assignments constitute “excluded assignments” for the purposes of the Act.
Allyson Colby is a professional support lawyer at Wragge & Co LLP.
