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Written and recorded by Hannah Mackinlay
welcome to the first of three sessions on commercial leases. Commercial leases. Do you have a bit of mystery of Onda? It's not actually that bad. Think about commercial leases. The clients better understand. Complex. They could be Andi as understanding the kind. See one commercial lease and they think it seems all the other ones. And then there is this mythology off First Standard. Least you get clients telling you, the agents have said, Oh, we don't need to see its listo. It's standard lease. There is no such thing. Standard lease. I need that There was a standard lease. It wouldn't work because there's no such thing as standard property or standard client. So kinds have to realize that the differences may be small, but they could be quite significant. On one way I try and get this home to them is to point out that human beings that your client sitting in front of you is 98.5% the same DNA instructions as a monkey have been 100%. But in most cases that makes a difference. So we also share 67 my dear name with Paris, so it their little differences could bankrupt. They're kind of client if they don't get these sort things sorted out. What we're gonna look at three different sections off the modern Commercial East President, which is available for download to On This is part of a suite off commercial leases, which have been very well received. It was a project started off my property federation on in my notes. You can see when you get them from model commercial leases dot co UK. There's something retail, punks, buildings, hole just states etcetera. Andi do use them as an alternative to practical ball for his out. For other brands are available on day, probably fairly straight down the middle of what's fair landlords or tenants where some people think practical, always get more favorite Lord, they're a good starting point because they contain a lot of square brackets for things like premises, which is very important. So it's not just question of putting back in what the man more socialist across town is about. Looking at the physical property where the rights decent fire escapes are as considering whether or not police triplex it, considering the length of the term clients responsibilities. What sort of property is on so on. So everything I must say we predicated that it applies to something like the parts off a building which is not gonna be a brand new building. It will be secondhand building is being used before and therefore there may be issues over perhaps repairing obligations on definitions of demised premises whose land laws, which is the tenants. But again, it is a massive mistake not to look at the plants. Look on Google Street view and understand things like, Where is the parking? Where is the pistol? Where's the bicycle yard? Where is the fire? Escape is one of the most important things. It isn't just filling in forms and glacial process on something. Your client gets commercial lease. It has to doctor exactly with physical presence on the side of your clients use, but also some kinds thinking that searches are not necessary on commercial leases on, they may say, Well, just look at the least it standard lease and their politics Searches don't seem to realize that if your kind it takes a lease off a property that hasn't got planning permission for the use that's for Mrs on police or is in breach to a variety of different health safety fires. Festus, you name it obligations that would be revealed by local search. Doesn't have water, doesn't have gas. And still on that they will not be able to handle these like and they will still have to pay the rent all the way through to the end. Police, even the dip operative they can't use. So the searches are actually for your clients benefit. The lease is for the tech. Vandals benefit Andi. It's again, clients head in the sand. Nothing is complicated, everything straightforward. They just want to see the keys. So, first of all, the first session, first minute session We start off looking at this lease on basic on commercial leases. Now the procedure is gonna be slightly different from convincing of, say, of residential property, because you don't automatically have to have a contract. Andi. It's a mistake to just produce contract for no reason whatsoever. In many cases, you can't enter into a contract until the terms of the lease or agree. You can't agree to take a least till you know what is going to contain. And by the time you got released, agreed on you got your searches in place. While you might just grow up police so often. If there is no conditionality upon, take superior landlord's consent or anything like that, you just going straight to lease. Now. The average leased land has groups to reduce quite considerably in the last 5 20 years. It used to be the average least Lantos. 15 to 25 years. These days, the average police planted about 5.8 years. Andi is very much attendants market now. There's a lot avoid anti property on tragedy is the tenants don't realize in a strong position they are. We're negotiating terms. The best thing you can do is try and get involved in getting these heads to turn straight at the beginning, because clients for happily sign heads of terms, not realizing they found that well, they haven't found themselves deciding heads of terms. We understand that, too, but they will agree to do things. I take full repairing leases on short properties. They will comply the elite labor, looking for things like parking and service charges, rights and easements and stuff like that, and they'll be sort of the landlocked agent will play upon their naivety and the tenant themselves. Post haven't might not want to admit that they're not such a captain of industry that they're making out on degree things. First thing is trying to get clients before you get the least sent to you on trying it heads of terms and see if you could really go shaking things at that stage because you'll see himself a lot of time. Otherwise, you end up having to mark a police. The Vandals list is going to be a little bit less likely to move these already prepared documents, so procedure is get heads of terms socially with the client. Make sure they understand the importance of getting searches done on. Ask yourself whether it's gonna be necessary for us to be a contract or not. If you're taking the least of a property. There is no Supreme Superior land board. There is no to consent. There is the conditionality on planning permission. Then they need very often. Leases are some police is on. The lease is in which case, the It's not unusual for the agreement, conditional upon getting superior Lisa's consent, etcetera. Now, obviously, the landlord wants to get something from the talent and the terror doesn't want to start doing 50 works or something of that nature and then find the landlord takes advantage of them to check in terms of the deal. Because, of course, they had to turn to fighting. So is there a need for head of terms or not? Sorry. Agreement along? No. So I'm looking through my notes. They're going on to page two. Don't forget the CPSC enquiries raised their head. Also, you may have to use CPSC one on CPSC three Simple property. CPSC seven, cpsc three. The CPS enquiries are vitally important on separate man made. See Guessing Caray's CPSC three in cars are specifically get towards the additional two CPSC one. When you're taking a new lease lead format, there is no standard. At least as I said, there are a number of good projects such as the model these commercial leases, but no other brands are available. The R. I. C s has published excellent small business leads which can be downloaded from their website writing his landlord Or possibly you might find that on. Indeed, I've heard that some landlords agents are issuing the eyes here. Small business leased to tenants direct and saying, Oh, you don't see is that it's all standard. You go right on the eyes, yes and so on. So clients would again have the wool pulled over their own eyes. The small business least prepared by RCs is not really easy to amend it or anything like that. You would have to add writers and things of that nature so not necessary. Wonderful for listers who want to negotiate terms. One thing I would say that wouldn't capital societies business leads with a barge pole. It's many years out of date. I actually think it's appalling. Piece of drafting personally on it should should have been updated some years ago. It's taken so many changes made. It's almost impossible to read cause the farm size is so small and it's almost impossible to amend to without having lots of schedules. So we'll even start with that. I start with a decent modern form of police. So will it need to be registered with police is from all the seven years will be registered land registry. If the leases for less than seven years on it grants rights over other parties, land or the landlord, other titles, and it will also need to be registered as a notice skater of other titles that forget you need to investigate. Experience handles a little common may and don't forget. Also, they may need to get superior landlord's consent if released from more than seven years, you will have to have the prescribed lease clauses which have been set out the land registration rules on. If you don't put them in, they will not registry. The landlord won't care. He's got your cover to pay the rent under the least. So is something for the tenant to check. What is the taxman? Please say listen 70. Issue rent deposit deeds. Now These days, cash is king. Someone said It's not only King, it's the whole roll family, so it may increase may be the case. Instead of guarantees or personal guarantees or parent company guarantees, short term leases may be protected from the landlord's point of view by renting positive. Is there such a thing as they stand to rent deposit? Eat well, Clearly not there isn't, but there's a very good passionate available from the city in London Law Society's website Andi. Typical issues coming in that easy to amend. If you want to take this out, put it. But it covers lots of things, such as 100 deposit is going to be kept whose account it's going to be kept in. You no longer have to rest a rent deposits at the company's house as mortgages has made things a lot easier. Deals interested deals with instructions it deals with the circumstances of the landlord. Can withdraw from Lille. Can't don't forget to point out to tenants, but will landlord can typically withdraw from the account of any times your least rather than just the end? Also, that they're usually provisions in a rent deposit. Be saying that if the landlord does withdraw on the deposited, for example, tenant has failed to pay a quarter's rent. Then the tenants will have to also make up the shortfall in deposit the land. But May uses his cash flow over. Get the money off the red deposit and then continue to press your client for payment of compliance with the terms of the lease, ready to top up any reduction, etcetera. Andi also what happens when your client chooses to assign the least that they've taken. They will want their money back on. It will be up to the landlord to negotiate a new deposits days from the incoming Senate. Make sure that the rented positive covers that right Next thing to think about absolutely super source off guidance for tenants and landlords is the code of leasing business premises in England and Wales. Voluntary code. The result. Off a pan industry discussion between landlord helps and government. You can get that from leasing business premises. Thought you kill you. OK, and if this is something you haven't seen before, I stress dress dress. You must must must download this and read Landlords code the occupier code on the model heads of terms. Now this could be used in a number of different ways. First of all, the model heads of terms is a useful aide memoire to make sure that all the relevant points that you need to get agreed are there before you start dropping the lease on behalf of the Mangold or look at amending the lease or considering if you're acting from the tenant, it's also useful to be able to show to the client what sort of things ought to be included, because, sadly, for my spirits. Mandel's agents lose interest in getting the terms detailed. All they want to do is get the identity of the talent. Make sure that good covenant get the rent. Agreed to turn commencement date that you get very short. Sometimes useless heads of terms That's enough for them. Don't have your own sort. You go back to say, Look, let's have a look at some of the detail here that is missing and your own professional body is signed up to this. So let's try and get these agreed Heads terms because it's going to be a lot quicker to get it agreed in principle to start to re amend Andrea Mend re amend a drop, please to reflect reasonable terms. The other exceptionally useful document convention is the Tenants Guide. Now where's the landlord's guys? Roasted the short, two page document intended for people that are conversant with the landlord intent matters. The telescope is very much easy English word for someone who might be taking their first lease on, I would strongly suggest you go through it with Clyde, possibly giving most definitely give you a copy to take away and possibly underlying your highlighting things. First of all, it's written in easy English. Secondly, there's more of a chance. Remember what you told them, because I'll have something to refer to. And thirdly, it could be seen something but not landlord or tenant friendly, but is plain common good sense and explained important things like repairing obligations, full repairing obligations, assignments, consents or price guarantee agreements with importance of definition the premises. And it contains a number of tips on reminders of the sort of things that tells me to get agreed at the very outset. So I I would definitely give clients, and you may want to even think about if you're doing lots of work preparing your own Certainly ice. Do that your own guy to commercial leases that you will give to clients and brand up your phones. No paper or something like that, not just a wall of white paper text. Go do graphic design and desk top publishing it because it may be that they find it really useful. They may keep it. They make it to tell people it's good marketing tool. But its key with all of this is communication, making sure the client actually understands it I think I've talked to a number of people lack for land laws in house legal counsel, etcetera on. They get tenants coming to see them to take leases. And they say, Look, you need to see if it's all right. So I'm just gonna silence monkeys, just keys and they have you read it in the hell are scanned. It scanned it and they say, Well, what about this school? Always or I just want to find it. They just want to move in. They want to ignore pretend head in the sand, that problems. They don't read anything. Toe. The previews are scanned it. So make sure that they don't have any ability to complain that you didn't explain anything to you could see all the fuss in the paper about grandparents on Seo. We were never told this. The same thing happens on commercial leases. They have courses were never told that the it was a full repairing lease, that there was a break clause that wouldn't be operated that extended didn't have security of tenure. In reality, they used to forget, so communication is absolutely vital. So going through the least first thing data police obviously left blank for completion parties. Now this may seem banal, but it's important to try and work out who your client is because they may be limited. Company, the client may know, actually get the own company name right. They may not remember the rest office. They may not know. The rest of company number is absolutely vitally important that the correct legal entity is specified and even more since your landlord on one handles on it even more so. Relation to guarantees. Who is the entity? Corporate, otherwise, is giving guarantee. Are they company? Do they exist? They worth anything? No. Getting you go on wet check on companies. House pitches up the name of company changes only when companies has makes the alteration. It does not change on the issue of a resolution by the board of directors, so check company names before completion for exchange contract. It's free excuse. Next thing, maybe tedious definitions clause. You do need to look through this because there may be all sorts of clever things buried in the boiler plate. For example, things in relation to consents it may have a global thing, saying that where either party has to consent to something neither party will unreasonably withhold Order. I consent. It may, for example, look down the provisions as to the use classes provided as at the decorative Elise, all from time to time may or may not include successive entitle it, etcetera, etcetera. So do not forget to go through the definitions quite closely. Next thing. Interpretation. Now I mentioned already the importance to lock down the use that is defined. A new classes will come onto later, as at the date of the lease, rather than from time to time. Because these classes changed all the time on your client could find out there particularly used waas within the use classes, days police and then two years later it isn't news class that they're not able to use it for the purpose of police. That's one little point. But the most important thing that is often overlooked and not dealt with properly is the definition of the premises. And again, everyone is just in too much of a rush to get through on. Sisters often don't know anything about property. Don't look it up. The check the plans. They look up on Google Street view. They have any idea where the property is on, and it's very important that you know, whether it's an old property, a new property, newly constructed property on what, exactly is the extent of the premises on? But the client checks the plant. One of the most staggering examples of an attitude that I read a couple months ago was a residential flat in Carlisle, where nine out of 11 off the flats in the property occupied the wrong flat Onda. Neither the twisters acting for tenants nor the tenants themselves had realized that they all moved into the wrong. That this sort of problem arises all the time in relation to presidential, probably on commercial property. People don't check the plants. They don't check the rice. They don't check the easiest. A couple of times recently, I've spoken to in house counsel. A large companies said they had bought one case of Industrial Park community no case of building in London, where they had just oh, just scan the points in relation to Premises writes on. They found that they had no effective fire escape for property, which meant they taken the least or the ultimate on. They simply couldn't use it on their slippers were at fault because they had just assumed all the boilerplate was there. They beat, they'd asked enquiries and they were told, Oh, you must rely on your own enquiries. They had explained to the client how important this waas they didn't realize that the fire escape escape route, which had bean used on the ground, not refer to any deeds or anything like that has absolutely no basis in law. There was no right to reasons over adjoining property. Atal. Same sort of fingers on the car parking state or think about been stores, service jobs, storage areas, access routes and all the rest If the devil is very much in the detail, so make sure the client, you know, strap in tow like attack to shine lights in their eyes. Do whatever you like pointed. Put needles into the say Where is the right? Where is the car parking? Where is bin stall? Where is the service charge? Are there any shared toilets? Are doing each other committees? Is there an atrium? Is there a lift? Is there a storage area is restored. Shop is an electric vehicle charging point, etcetera. Where is the state road. Other alternative accesses on all this stuff. If you look at the leasing business premises of persons of leases, your fever in the schedules, there are copious square bracketed areas for exerting rights and obligations high in ages. Another A. It's often overlook. There's actually no point taken. Industrial. If you haven't got a sign on the front, say, here you are. Or is it? The end of it is State Road that there isn't a sign in front of the state road saying to everybody else that you've done that. So things of this nature are absolutely vital victimize property. Does it include The windows doesn't include the window frames that include the roof. Areas include the basement only so often, so many times people seem that they have areas that they have no right to do. So basement areas. They go on put, um, PV power solar panels on roofs or air conditioning units on roofs, that they have no right to do so because they it is not within the demised premises. So what is the plan? Is it correct? Doesn't type of the land Registry doesn't entire with what's on the ground, because if you signed up police. The landlord could make you pay the rent. Even they can't use it, even though it can't be registered. Next point. The detail Is it an internally or externally east? Is if is a repairing obligation on the roof of the foundations of supporting walls? Or is it that the landlord will repair? Structural items on attendant will repair the internal items. If, as a rule of thumb you're taking a short term lease of the interior property, you want to be responsible for as little as possible. Possibly only painted services or things like doors and walls and window frames, with the landlord being responsible for external windows. Possibly not the glass with their friends and doors, exterior services, etcetera so that the landlord will maintain these as part of the makers of buildings a hole. And it's only fair right that the landlord can recover a service charge from lieutenant as part of the deal. So a little bit of time spent on examining what exactly is within the definition of device premises will pay. That was a part of benefits at the end. When it comes to the reputations planes repairing obligations on arguments at the end, released the next thing the term Is it fighting seven years of 10 years, two years? And so from what date? If the least term starts on the date released, then that's all fine and dandy your plants, getting what they expect. But very often leases are predated toe earlier day, often the previous court they often the day before today. Before that your client takes a three year lease is being back dated. The previous court today, it's coming up to the end of the current quarter ends up with two and 3/4 year least north release or prostitute off year lease rather than three. So check that check pipes outstanding. Head has to turn to check the doctors. The operative closes. Then these are gonna have the all important clause saying the landlord, Let's to the tenant or the landlord demises the premises to the tenant or something of that nature. They will also incorporate by reference rights granted to the shed in the schedules over the remaining the building. And I've already mentioned that this has been in some detail. The boat will invariably reserved runs over the building to so again you gotta ask yourself these affair. The rent will be reserved. Rental normally be defined as including all payments to you onto the least, including insurance service. Charge rent reasons for that historic. But it gives the landlord additional remedies in some cases, to recover some monies. Lando's can no longer use Bayliss to reserve Teoh Count Way property. Without noticed, they have to use the commercial Rent arrears Recovery system, which only applies to actual yearly rent, does not apply to service charges. The next thing is there a premium payable. There is opinion Pavel. Then this may be subject. Castiel T. Of course, it's in excess of the new rate rights Granted, as mentioned before toilets, rights of access, repair points, escape routes, services, buildings, bike stores, etcetera. Site visits may be appropriate. Parking can cause deals fail. The client may want to know that they are going to have those parking spaces outside the office building. Etcetera are not such parking spaces as are given to them from time to time at the discretion of the landlord. Because it may not be appropriate. There is still on argument over whether you can, in fact, half uneasily to park then the until the Lord Jesus is reformed. At the moment of all seems to indicate that specific, easiest part can't exist. A czar interest in possession, right to park in such places from time to time as designated is. But in many cases, laws will stay. Well, we're gonna give you right to park or they may demise leases to you. Um, I don't know where that's gonna go. Probably wind up retrospectively. Nobody can argue about it if it set up a leasehold right over a argue a subtle thing dimension then accepting reservations. And it looked carefully. Normal rights of a landlord to respect property and also to carry out works on adjoining building can't really be objected to. But Norman usually expect the landlord to agree that these works because it happened in a reasonable manner, the compensation for any damage, although suffered Then there will be a serial other obligations, usually extremely long obligations on behalf of the tenant to comply with a whole series of tenants governments very short obligations on the landlord to maintain building provide services on There will be obligation on Thank you
00:26:41
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Written and recorded by Hannah Mackinlay
welcome to part two of the three sessions on commercial leases covering the main points you think about when looking at the commercial East. The next elections. Look at his rent. They were always the attendance conference paying the rent reserved C equals 3.23 point seven in the commercial east that you have a president. This will include the monthly, quarterly or annual rent payable, as well as these sums reserved in the least Trent. Now, Um, I said before things, Do you change these days? Sometimes you might have a monthly rent, but the normal one is 1/4 rent. Thanks to check from landlord is that there's no ability for the tenant to make any adoption or set off from the rents payable. Now, tenants will just assume that the lump is not right. They can just stop paying. Now, of course, the landlord may decide to sue them for rent arrears. Lots of interest will ultimately fourth picture. If they don't do say, they have to deal with that as a separate argument completely so they will still have to pay landlords investment purchases. Etcetera will not be happy Now. There is usually a definition of renting the definitions clause on the rent will include any increase rent under a red review. On it will be an initial sum payable on their subject to review. If the rent review provisions into your course, Lee should also deal with the falling in relation to the rent, the date from which the rent is payable on the date of the first payment. Now, these days, there is often a rent free period of perhaps two months or even up to two years negotiated. So the least may well say that the term starts today or a big quarter day. But the the rent commencement date make a specified date of the future on that. On that date, a payment be made off the a portion of some from that date until the next court date on next thing. Quarter date. The old fashioned quarter days. Our 25th of March 24th of June time. 9 10 or 25th December. Some of you may have noticed that there are five days in March 24 days in the word June 24 9 There are five letters in the word March 4 letters in the word Jew on nine letters in the word September quick way of remembering 25th March early for June. 10 blocks of September doesn't work Christmas, but sometimes you get the modern quarter days, so make sure you worked out your a portion. It's on that. The figures in the least agree with what's in the head turns on the client understanding. Next payment. My in laws expected payment of rent by standing order or direct Bennett on, not by checks. Although sometimes clients want to pay checks because it takes of the bank for a couple of days, most institutional leases will expect the clients to pay money without any delay whatsoever. Um, they will sometimes agree Toe have what's called days of grace, which says that if the client tenant rather pays the rent within that spy days on the court today, no interest will be payable. But if they paid six days, then they will have to pay interest backdated to the court today. So these other days of great tenants are often a bit rubbish about paying rent on time, particularly Christmas, because, let's see might they should pay the red earlier 25th but Of course, they pay on the 25th. It won't go through because the bank is closed will end up having to pay interest. The importance of being clear on this can't be stressed enough because it could invalidate any break clause your client seeks to operate in the future, which is conditional of payment on all some issue on the lease on time. So so, are there any days of great? So how many a week possibly is a reasonable compromise? In some cases, you'll come across some unusual rent. Such a turnover rents were There may be either pure turn of rent or alternatively, maybe a basic some, plus an additional percentage of turnover that can have complications in relation to reviews. On also calculation of the turnover, particularly with a tenant who gets a lot of their business from all my sales or from a number of different properties, Andi, it's gonna be something that you need to talk to clients about. What's fair rent free periods could be with a number of where leases, the example that you've got. There's a to month rent free period. The definition of rent would be from the period all this state to whatever that date is there after a 20,000 year and then the date of the first paid rent for two months off data police. So make sure that this all works. The apportionment is correct. Read, review and again, only about 30% of leeches habit views. And they're going to be leases that for more than six years there are different methods of re you ready? We talked about a turnover rent. The most common method of reviewing red is the market value review. The most common rental period is five years. It's very rare, but not impossible. Tohave fixed increases so that the rent is called step, so you have specified friends that will let me go up towards specified dates. It's also possible, but not common tohave indexation off the red to specify. I didn't that, such as retail prices or Consumer prices index with the more common open market review system. What will happen is that the landlord will initiate negotiations for the review. Tenant state usually wants to negotiate an increase in rent turkeys for Christmas fight common unless they're hoping to assigned, at least in the future, on the Assani wants to know what the right is going to pay so often the landlord will initiate a review by it will be an automatic review on the specified review dates, and they may seek to negotiate the increase rent prior to the review date. Generally speaking the way most interview calls his work with, the parties are encouraged to try and agree things without going to litigation or arbitration. But if they fail to agree what the revised rent is going to be, I'll undated the review, or perhaps a month or so before then, the landlord certainly will have the ability to refer the matter to an arbitrator to decide what the rent is or an expert Now is always a good thing for the tenant to ensure that they also have the right to call for the review to refer to an expert or arbitrator. This, for instance, of mentioned this guy potential assignment in the offing. They may want some certainty over what the rent is going to be, so the rent review date should be specified in the lease, and they will usually be the fifth anniversary off the commencement of the term rather than the connection to the date of the lease, knowing that it's common for state mansion purposes for the rent reviews all to take place on the rent on quarter days on. Sometimes the landlord must have all the rent abuse kind of at the same time to minimize costs, expenses in the block, offices, shops. So is this. What kind understands? It may mean that it's perhaps a backdated least the reviews, perhaps 36 months earlier, that I was expecting. The next thing is the hypothetical lease. There are some complex sets of provisions. If the clause has a red review over how an expert or arbitrator would be expected to set the rent, generally speaking, they will look at the premises as they had occupied. Under the terms of the ladies, they were assumed that this will be reviewed on the basis off lease on largely the same basis, but excluding this current rent, but including a red review cross. But sometimes you need to amend and add the assumptions and disregards to reflect the reality. This could be where there are unusual rights or easement or rights that personally enjoyed or break cause of personally enjoyed Andi. There isn't such a thing. Standard view floors find the two. So this is something that's got be thought through carefully. If there are unusual rights reasons or other enjoyed right, such as parking under adjoining leases break such. How's this going to work? Yes, there is that any surveyor value are asked to sign next, but Rent is will be considering what the fair market rent will be for this hypothetical letting in practice. What happens with the landlord in the talents will negotiate surveyors who will seek to negotiate for interview memory movement. You will be entered into, and there will be no need for bears to be appointed to decide experts or arbitrators. Now, in general terms, most read of usual come across our upwards only, although you'll see that the code of practice commercial leases indicates. But landlords should be prepared to offer upwards or downwards read reviews in their lease. But Game tells usually stress that they want this. It will in fact, increase the initial rent in the current market because it's got concession to the tenant of the grant will go down. In any case laws. Banks will probably agree enough. It's very contentious in Northern Ireland, on other as well. Also, things going on that front who's but the moment is generally a present. Something to avoid in the drafting is trigger notices whereby the landlord will serve no, some saying the rent is going to be so much unless you object. This sort of thing is dangerous, because tenants will often forget to deal with the notice. In time, they won't get legal advice. Whatever the Mandl puts in the notice will become the rent, and it may be a little more always trying avoid time being of the essence in relation to any application by the talent to dispute any rent, etcetera. Otherwise, knowing about the most companies operate that property bolt is it could backfire. So I said before you, normally the way it works is that there will be a period of time for parties to try on, agree the rent. And failing that, both parties should be able to refer the matter to an expert or arbitrator, expert or arbitrator, which one, generally speaking for most common or garden things on expert, will be easier to deal with. It may be necessary to specify in the least of the expert will take into account the representation and counter representation of both parties, and it may be specified the expert will have to be a surveyor of not less certain, that's of politik ation Having an expertise in this particular area, it might result with by an arbitrator than the decision is what Rent is will be decided on the provision of the arbitration act. You don't have to go into much detail. No, while the points they talked about in my notes Time of the essence and avoiding that you could help on also the mechanisms catcher. What happens if you get to the rent review date on nine of the landlord or the have agreed? What happens is that the rent continues to be paid at the same rent for until the rent is agreed. So it could be this could go on for a year or two. The tenant continues to pay the old rent, and then when the landlord tenant agree or cited by an expert, then it has to pay an additional payment calmly notice the shortfall to reflect the additional rent payable from the date of the view to the next quarter day on interest on top now, as you'll probably have seen the interest rates people interest rate releases, usually beautiful scent, and it would be no fair for the interest on the short fall to their interest that great. So normally the interest rate is one or 2% above the base lending rate from time to time from four. Any amendments that view claws are often strongly resisted by landlords twisters because they're probably renting out lots of properties on the same terms. They don't want to have to have special cases. But that doesn't mean to say should roll over and accept something which is manifestly on your client extradition interest. It's common for leases to require the turn to pay interest for center base, and that is a fair incentive to the tenant to ensure it. We pay the rent on time, and given that the Vandals only getting not or quarter with percent in the bank, the landlord will make more money banking with a tenant. But they would have got money on time. I mentioned days of grace as well. Value added tax is absolutely vital that this is part of heads of terms. As to whether or not the landlord will charge the 80 on the rent. It's optional is up to the Landel. Normally, they will want to charge me 80 because if they charged me 80 on the rent, they can claim against the 80 any of the 80 that they're paying themselves on things like cops of maintenance or repair, building Orlando's Asian fees and that sort of thing. So obviously it's gonna be a big surprise, lieutenant if they find that they have to pay exit rate percent, the 80 if they aren't arrested, valuable business because it will effectively be 20% more than expected if they are a battle is this way. You are recovering the 80 against their output that it may no concern it will just be a cash flow issue. Don't forget, if you're active reclined, which is something like the insurance company or bank. They do not make chargeable supplies for the 18 purposes, so it will be a great concern for them to know whether or not be 80 is chargeable. If the landlord agrees to grant the police with a Brent that doesn't have the 80 did, don't forget the Land book and change their mind any time I could suddenly decide to elect charge the 18 which would be an increase of 20% in the rent to any bank or building society. Now, in that case, you might want to put clauses saying the landlord will not protect the rent for any time that lieutenant is the tenant. Because, of course, the tenant may assign it to somebody else who will be in a couple of 18. Repairing obligation Now this is a really big one that is often overlooked on landlord agents are always telling your clients Oh, don't worry about repair. I know it's a bit shabby, but the man was a reasonable bloke. He might expect to put it into good repair, etcetera. Just sign a full repairing lease because that's what normally happens. Everybody else has done this only development, but worry about it because, of course, directing for the landlord. Unfortunately, client things vandalization is their new best friend. I'm also how it's alright, spoke to the landlord teams and I sky. And of course, the Labrador may change human, and it may be a different landlord in years to come on. It means the new landlord will say, I want a full repairing obligations. I don't care what the marginalisation said is not binding on on me. You have to put this into full repair. So it's a new bill property you'll probably have to accept for repairing obligation because it's gonna be immaculate. If, however, it's a second hand property and there are wants of repair obvious, then the Senate should insist upon a schedule of condition. Now. Often you get landlord saying, Oh, you could do your own change condition afterwards. Don't worry about it. They just sign up for release and, of course, their political. I have your eyes. The second condition will mean nothing at all. So you have to make sure that there is a shuttle conditions prepared before the leases end to entered into. On that the standard of repair expects done. Police is qualified by reference that Chechen condition that you look at the least precedent suggested you'll see just that in relation to alternative clauses. Now, when the lease ends, the landlord will serve something called any schedule of dilapidation on talent, listing all the box of repair and claiming damages for that work. I'm also claiming loss of rent for a period of time after the tenant moves out. Until the repairs have been kind up, there are masses and masses of disputes over till amputations at the end of leases. Land laudable want, get property in perfect condition, papal by the talent rather than them, so they could relate out something else. So stressed declines that it may be expensive schedule condition. They might risk falling out their new best friend, but it's going to save them tens of thousands of pounds of the And, of course, you should warn clients that if when they move out, they do get shed a little applications, they need to get legal advice. Ryland to try and agree it themselves because it's not uncommon for landlords agents when they do their schedule deal apt to include all sorts of things. That level has absolutely no right to plane. No, but most parents won't get legal advice, gets away with it. Other things to think about. Other than repairing obligations. Is the landlord liable for or lieutenant liable before inherent defects? This is a particular problem with the new building. You may be expected to take a full repairing obligation on the new building. But you don't have any comeback against the architect or builder who built it. It may then discover that there are cracks appear in the floor or ceiling or Paul's. You'll say, Well, it's not my fault. Milan will say, Well, you got a full repairing lease. You're saying, Well, it wasn't my fault was the builder didn't build it right? Landry will say it was your fault. Sorry for repairing lease. So if there is something like in the inherent defect, you might want exclusion from that for inherent defects or landlord may exist that because it will affect any of this threefold version and they may give you collateral warranties, you also have the responsibility to carry out the work to repair It could be major could be mentally expensive, but you will have the joyful opportunity to launch into expensive construction. Litigations recovered that from the architects or quantities or building contractors, etcetera on wish you luck with that one because they're probably going to defend it on. It may be that they've gone bust on. They haven't got insurance, So think very carefully about repairing obligations on new buildings on also on old ones. Decoration. The tenant will normally under modern leases, just have an obligation to decorated as and when necessary, rather specific decorating years. All the least sometimes say, and every fourth year or every seventh year they will decorate the interior, and every third year will decorate the exterior. Check how often decorating obligation is on whether the landlord has any ability to control the water, the color or members of method of decoration landlords ability to enter the premises. There will usually be what's called a high risk versus Jervis clause, which says that the landlord is entitled turned to the property to expected to make sure it's in repair before the end of the least on that if they find a want of repair, very titled seven inches, all the talent requiring determined to carry out the repairs and improvements. So I'm not improvement repairs. This attempt doesn't care to do that. Then the landlord can enter with their work, carry out their past and recover the costs from the time for the 10 dead. That's quite common on dumb. There'll be surprised the next general debate is one about what and then in the trade as absolute, qualified and fully qualified covenant as a method of short hand. I can't run, says Do not do this. Do not do that or not used for any other use than this not to assign not time to let is an absolute government the cover of the state not to do this. That or the other without the landlord's consent is known as a qualified government, and the government says not to do this. That or the other without the landlord's consent. Not in such consent, not to be unreasonably withheld or delayed is know as a fully qualified government what that means. If you're acting for a tenant, you want to see many covenant quality fully qualified as possible so the landlord can't unilaterally arbitrarily saying, No, you got the right to build. You are being unreasonable, and I'm going to take you to court for a declaration. You're being unreasonable. This runs through all the clauses in relation to alterations, for example, on change the views too, so there will sometimes be a bit of Argie bargy about that. And if you look at the code of practice on the premises that we look at the model heads of terms. You'll see some examples of what could be cross checked or not in relation to what degree on again depends upon the nature beliefs. If it's a long lease of the entire team building for 15 years, the landlord can expect a lot of control. It is a short lease of the interior building for two years on the calendar. Will expect a great deal of control over what your client does it. User user. It is extremely important. You have to check a number of different things. You have to understand exactly what it is. Your client's gonna use. The 54. You want to look at the use classes order. It's really miss recent version. Find out what you class that needs. You've got to check the planning history of the local church or below the authority to make sure that it has actually got a planning permission for that use. And you've also got check the Freehold title Check that this use is not Enbridge off any restrictive covenants. So a lot more to it than just checking the least. If your client signed the lease, we've permits them to do a use that isn't permitted on the planning or isn't division on superior covers, then they will not be able to use it. It's a simple as that, and the landlord can still expect them to pay the rent because the obligation is based upon the tenant to ensure that all the necessary consents are there for the proposed use. Also, the weather used possible changes from time to time. Do you freeze the use of the data but described in these classes, or that as of the date of lease, or to be aware that uses may be changed by committed development? Right. So property that has a paper least used for perhaps a hot food take away that's being used as a as a a restaurant for a long period of time may have lost that abuse, and they have to have a new application, so don't overlook uses. So there you go. That second off the three on you enjoy it on. If you want you wash. Thank you
00:23:00
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Written and recorded by Hannah Mackinlay
Well, thank you for coming along to the third RB three sessions on commercial leases on It's an important section. It's insurance, alienation, challenges for cause and security. How does it work generally with commercial leases with insurance? Well, the landlord can receive the talents K to ensure so that I'm not always cars out the insurance himself. The landlord will normally ensure the building, but we expect the talent will comply with traditions and covenants onto the insurance policy and will want to pass the cost of insurance onto the tenant. The tenant, therefore, will have a serious of insurance covenants, requiring them to comply with the terms of the clauses and not do anything which will breach it. Andi. Also next question to ask is How much will we don't have to pay? The landlord hasn't got any incentive to get a cheap ensure its rent out of tenants will have to make sure and stewed level agrees to obtain reasonable insurance, etcetera at a reasonable cost. Ways a suitable insurance. What about the retain parts of the building? Well, the gate that's gonna be something which replaced to the service charge back on, assuming that there's two sides started released clothes in there. Other point to think about our what inch Children's risks are there. Normally, you'll insure against the full stock of things such as fire, explosion, damage, flooding, terrorism, things dropping from aircraft, buildings and so on. So you need to do check the definitions of ensure dress to make sure that they cover the right things that will come on to some of the complexities of that. In a moment you look a red suspension. What is the amount of the cover? It should be sufficient to reinstate the building. Obviously not including the site you cause Land about you is not part of the premium. Some issues getting about Sort it out. Andi, usually a copy of the Vandals insurance policy and ensure be that tenant is happy with it on. See there any extensions or any exclusions because itself with your client, I want to use a flammable liquid on the insurance policy will save no implantable liquids to be stored. Um, then what happens if the property is damaged? The landlord will have to accept an obligation at least to use the proceeds off any insurance money to carry out any repairs because it will not be implied by Colin Law or anything about nature. Always make sure active lieutenant turned because force the man to do the rebuilding on make up a shortfall from the cost off. The rebuilding works from the land ALS own pocket rather than simply the man will spend. All the money that they got is not enough. Believe it in a rubbish condition, so required the landlord to reinstate. Then that's what I deal with paragraphs. Dini of my knows what happens if the landlord is unable to reinstate the building. Well, in that case, the least. Terminate. We'll come onto that in a minute with suspension. That's a very important thing. Has analyzed the tent would be bound to pay rent for a building that they couldn't years read. Suspension paragraph. She is actually important. The tenant needs to make sure that if they can't use the property or means of access or the services because off an insured risk or possibly uninsured rest exploring in it, then they don't have to pay the rent until the property is being reinstated. Read suspension. However, that is always for a limited period because the landlord will only be able to insure against loss of for a limited period of 2 to 3 years in general. Now this comes on to the next point. The cost off the insurance rent is payable by the tenant. The cost off. The loss of rent insurance is pale by lieutenant, too. Sometimes also, any excesses that deducted if the there's a claim on policy. Landlords always want to see a clear red. They want to make sure that they get the full rent under, although costs of running the building makes and service charge insurance paid for by the tenant. You see, because otherwise effect building. So check what being chilled risks are. Check the insured against terrorism flooding Check The red suspension covers damage to the building on also loss of rights and evils and services. On also checked with tennis interest is most on the policy. Ideally, the policy will be in the joint names off landlord and tenant. But normally there's a noting off returns interest. It may be automatically included in the terms of policy on, and you might be arguing about segregation waiver that this is something that seems to have pulled by the way side of it. Also, the land want the turn to to notify the landlord should be any event occur, which could give rise to a claim on hurts. It's absolutely vital you and your clients read through the recommendations in the commercial these code, because what set out there is a sensible way off dealing with the risks of damage to the building. But then it was here that the landlord sisters aren't going to produce on automatically reasonable and sensible term lease things in particular, concerned about our unusual users on also, um, what happens if the property is affected by an unusual risk? Just for an example of how this can all work at, Just assume you got a client who's taking a lease of a building. But it's not just an ordinary least of a building on an office or something. It's in an area where you can't get insurance against flooding for commercial premises. Let's take on the banks of a river or something of that nature. Well, you need to make sure that there is a definition of unshelled risks. Otherwise, if the repairing obligation says the tenant must keep property in for repair, brackets damage by inched toward risks excluded. Well, flooding is insured risks, so the properties funded the tenant will bear the cost. So therefore it national you have damaged by flooding. Um, as an onion Childress, you have a definition of uninsured risk on the obligation to repair would say that it must keep the property in good repair. Condition damaged by installed on uninsured risks exploded. And this would also carry on to the red suspension clause because it would have to say something long lines off if the property is damaged by uninsured or manage your risks for the means of access to it or services. Enjoyed your rights, enjoyed our interrupting or interfering. Then the rent will be suspended or reasonable part. And it also knocked into the the writer of the talent to determine, at least in the fact in the case of the fact attempt, can't go back in because the Lord has reinstated. So it would normally say that the end of, say, two year period, which is the loss of rent insurance period of probably hasn't been restored or in such a way you can use it as a result, standing by insured or uninsured bricks. In that case, Lieutenant can determine police so you could see the the the insurance on the repairing obligation. The rent on determination, off bearing to reinstate are all really important closes. Next thing to think about his alienation, meaning the ability of parent to sign the lease or sub let it. Now, again, this depends upon the nature of the property of the one handed Could one hand. It could be something like a lease of a department store, where it would be expected that the tenant was sub let concessions or areas or floors to other people on been. Therefore, they should be allowed to sublet part. Often, land laws will not agree, subletting a whole. But again, the circumstances may be different. It may be the sort of property where the land all except the 10 is going to take a least all the whole on a long lease, possibly a grand red, and then we'll be able to sublet part of the building. Is officers or sub. Let the hold of the building to the bank or something else so gave something to be pulled about at the Abbott said. On my head terms come through, they will be affected by Vandals antennas attitude towards this, the short of the least, the more control the land order expect in the more restrictions Now we talked about sub letting and let under letting of whole one of alienation will, obviously, anything they happen in the future, and therefore talent should always have the right to assign the whole of release. They will generally not have it right to assign partner believe, however, because if that happened, then it would start. The Landau will find that they would be dealing with more than one tenant in relation to recovery service charges, insurance and so on, and this would be impractical. But a silence of whole should be committed. Now. We remember that the earliest spoke about qualified covenants and fully qualified covenants. You should always expect that the talent will have a a government which says that the landlord cannot unreasonably withhold or do a consent to alienation off whole off the property sign or under let, rather than absolute absolute company not to sign that, Mandel's said. They said it would have no way whatsoever of getting out of the lease or finding someone else to take it other game, The longer the least more flexibility should expect the shorter least last activity expected. So it's very unlikely. Indeed, that will be an absolute bar on any assignment, unless it's incredibly short term lease six months or something of that nature. So you'll usually have a pretty qualified covenants to get his alienation off. Part of undulating sorry, alienation, whole or underwriting of whole possibly absolute covenant against underwriting part on undulating I side with part, though sometimes the landlord maybe from it big prepared to let the talent under threat the whole or part of the property, provided that the under tenant doesn't have security of tenure. We'll talk about that major. So it's all up for grabs depends upon the strength of the parties negotiating positions and also depends on the nature of the property and how it's going to be years. But all this look was much qualification in the laws. Companies is possible in relation in relation. Now, what about authorized guarantee agreements as a result of the nineties covenants? It's now pretty much accepted that if you assigned the lease to incoming tenant, they will have to guarantee that that incoming tenant will perform the comments in conditions of the lease. Now, obviously you got to produce a talent and a tiny that is reasonably suitable toe landlord, because obviously they're going to be the people primarily responsible, paying the rent to complain to the government's. But unlike the old regime, where a tenant who originally signed the lease was liable for the full period of least under the 1996 at the seventies, automatic released on assignment so the Landel would only be able to go against the incoming tenant. For that reason, landlords increasing looking carefully at the nature of the tenants that things were being assigned to also the ability of the provide guarantees deposit bonds. And they will also insist that the outgoing turned or guarantee the income toe will comply with governments the least. As you may have picked up already, the next assignment on by the incoming tenant to get another incoming assignment will figure a release off the original tenant under the authorized guarantee agreement. So although I I guarantee agree with hit steak on, it's not unreasonable for Vandals to expect these. So you talked about emulation of whole relation of part, and we look at security of tenure later on. Don't forget that mortgaging at least although unusual in relation to record at least is usually going toe have to be considered. Some institutional leases contain absolute Covenant Gate challenging on wall two premises. To be honest, it's not much of the security for a back who want to take a mortgage on it because it's no any value on the general terms, bank or lender would not want to take all the responsibilities onto the lease. But anyway, you may find grand red leases, for example, where there is a capital value that this may be different payment of land. Most costs. Landlords are going to insist upon a clause saying that any public, any costs incurred by the landlord will be paid for by the tenant. Seven. Before landlords want clear leases. So this could be any notification or consent or application. Etcetera will trigger an obligation to pay the Vandals cost. You may want to try and qualify. Used to be reasonable, quiet enjoyment. Virtually the only confidence you'll get from a landlord is that they will not try and re let the property somebody else quiet enjoyment or interfere with your ability to use the property during the term of police. They were also and should agree to maintain the structure of the building subject to the tenant a green to pay a service charge. And I think they make sure that there is a positive comment by the landlord to carry out the work necessary to keep the building in good repair and carry out the any works of services. Etcetera. Landlords will normally want to have some sort of publication to an absolute obligation on them to maintain, such as where they're prevented for doing so as a result of have strikes, lockouts, adverse conditions or force majeure. And that's not unreasonable as long as they accept an obligation to carry out such works as soon as reasonably possible. Um, subject to such provides it. Now, Um, what are they going to maintain? Their gonna maintain structure really takes security arrangements, landscaping grows and all that sort thing on provide often towels, eating lifts and all sorts of things that going to be important no uncommon for tenants in a small office development, say, to share toilets which are okay to be within a shed corridor expressway. Sir, the number of tenants and the landlord should accept that they will have to provide heating water, light, etcetera, paper, toilet subject to reimbursement that cost by all of the tenants of the service charge. The next thing Levi onto that is so charged itself. But this is sometimes very difficult to assess because you know this property. You don't know the areas, but he needs to make sure that there's a structure in place which is fair. How is the service charge going to be apportioned the various ways, usually on a floor area basis or possibly rental or a fixed percentage? Militias specify this on. The tenant has to satisfy himself this calculation that it is fair service charges are also difficult because you went faced with a list of service charge. Costs can tell because you're not doing where they are. Fair, reasonable, not You should normally expect to get three years service charges, and the client has to satisfy themselves by targeting Severo Bhaiyya or generally their own knowledge, whether the amount of service charges fair Now, I like the rent, which is payable quarterly in advance. Normally, Sturbin charges are payable in two ways. First of all, the talent will be expected to pay a quarterly, some in advance of service charges and then want to service charges. Year has ended, which may not be the same in the least town here. The let managing agents will work out whether or not there's any extra payment made by the tenant to cover the costs. If there's a mobile payment, normally most tenants will want that money back rather than getting into a sinking fund. So what else can say? Well, there's so much contentious cases about service charges that the artist he has introduced a code of practice on service charges in 2014 that is now in its third edition on the idea is that handles can't charge a greater proportion cost that it will cost. And if there are empty properties, for example that could be let out, then they should be the responsibility of the Vandals. For example, if you got 1/4 of the building empty, then the landlord effectually pays quarter service charge itself. It doesn't pass all of the service charge onto the remaining three units. So again, take a bit of care looking the next thing that you will always find its the landlord's ability to enter the practices with the so called forfeiture laws, which you wouldn't get in a ground. At least you'll always get in the back rent lease. There's a bit of a NT threat, some Mandel's because of the moment If they forfeit police, then the tennis obligations paid the rent ends. And, of course, they may not be able to get another tenant is quite uncommon, uh, for landlords to forfeit leases these days unless they've got a good chance of renting out. Or there are other circumstances, right? That. So don't be surprised if there is a pretty clause the wrenches in arrears 21 days or 10 it becomes insolvent or otherwise breach. If there are no dust for police, all is not lost because the tenant has the right in the case off a for fish of nonpayment, of rent to pay a lower rent, outstanding box costs and they were also actually get relief from forfeiture. If the little monster false beliefs, other purposes such as research government, and then they have to serve something called Section 146 notice on a tenant detailed in the breach, giving the landlord a reasonable time. Giving the 10 a reasonable time to remedy that on its intended hasn't committed a breach. Mannitol has to go to court possession professional. And again, the court has a wide discretion to give the turn relief from forfeiture battle that the tenant says, I'm really sorry being about, but I promised to do that on to take to the court to do this work in the next three months. Then they will get relief from forfeiture. The next point, which is very contentious on there being masters of litigation over in recent years, is break closes, Um, mainly because tenants will have negotiated a break for beginning on. The landlord doesn't want them to go because nothing emotional personal about this. They can't get another tenant, so they will find any key possibility they can to say that the break cause is operable, possibly because the temper hasn't complied with any preconditions, possibly because they didn't serve a notice in the right way on the right person in the right time, etcetera. And they trust me, they will find any reason they can to say the break laws cannot be operated. The trouble is that in the market, tenants are just so keen to move into properties that they will accept break clauses conditional. The sort of conditions you might get will be, for example, conditional upon this. Having fully complied with the covers contained release well. If the break clause is conditional upon that and breaks lost, his fight unlikely to be capable of being operated because there will always be some tiny minor want of repair or payment of some small noticeably or something else on quantum is not relevant. If there's a tiny, tiny breach, then break laws will be invalidated. So that's five. The practice of business Premises says that tenants should not have any conditions on their break ALS of a tamer off the yearly rent outstanding on the dispute. Overstated repair should be left dilapidation claims afterwards. But in the market, and it's so key to get in, they will just say, Oh, it's all right. I don't mind. Landel sees a reasonable but and they accept conditional brake hoses. Family China operated Landel points out of some want of air or failure to comply with the notice provision and then had a local her saved and tell them by this. So again, many traps for the unwary. Lots of appeal court litigation over tiny, tiny points of law where landlords trying get off, get Tell us, um, to stay in that next thing. The security of tenure. Well, the overarching idea, the landlord told back 54 is the tenants should have security of tenure, which means that as long as it's a business lease and it's being occupied in the most general sense of terms for the first of a business unnecessarily profitable business by the tenant or tenants controlling company or vice versa, then tell it will be entitled to a new lease on a market rent for a similar period of time. Um, unless the landlord comm prove that 10 has been a bad tenant or in general terms, Landel wants to reinstate or sorry reoccupied for their own purposes or redevelop Onda. So for that reason, landlords want toe talents to accept, least without the security of tenure. But obviously Lieutenant does accept at least that security of tenure. Then, at the end of belief, they have to move out. And if they don't agree, whatever is the vandal demands that tells Renew these, then they have to move out the landlord's away. All the highlight. No choice whatsoever. Unfortunately, in the market again, terrorist don't realize how much of a strong position they have, and they don't really stand their ground as much as they should do on insist upon getting security of tenure. If your client is going best of all time and money on building business, generating a lot of passing, trade an interest and locational goodwill, and they don't want to be at the mercy of the landlord demanding whatever rent the landlord wants released comes up to review, knowing that they don't take money, they lose all that business. So again depends on what sort probably is. But do read the riot act. Clients are only too willing to accept. Lack of security tell you now is the tenants do, except not have security of tenure. How does that security get excluded? Well, the answer is there to rate of doing it the first way it the normal way, which is the landlord. Once terms are agreed on, the terms at least serve a notice what's known as the health warning notices on the tenant morning lieutenant that they are agreeing at least without security of tenure on the tenant has to have a statute declarations sworn in front of an independent sister say they've been serving noses and they understand what they're giving away. If they do that, they can then get the least contact them immediately with security of tenure. However, if time is no off the essence, then the cooling off period mechanism could be used whereby a notice is served on the same way. But the term has to wait 14 days before the leases granted on then had 14 is to reflect upon meaning of life security, tenure in general on the prepared that they're able and to take a lease without security tenure. If one of these two scenarios are not entertaining, to the least, will have security of tenure, so that's quite important. Finally, just to wrap up, be aware off old leases leases granted price in one night once first Daniel 96. These obligations are tennis on businesses are different. Parents who signed these leases are bores like breaches of covenant by whoever may be the talent anytime in the future, and they're not automatically released on assignment. New leases granted out. First of January I alluded to before the tenant is automatic. Released on the assignment will only be like under any authorized guarantee agreement. Well, there you go. You have benefit off 3 20 minutes, seven hours on commercial leases And I hope you find interesting. Thank you.
00:24:55
