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ARTICLE · 10 AUGUST 2016

The GAGA Saga Continues

Clyde & Co
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A recent decision has confirmed that the anti-avoidance provisions in the Landlord and Tenant (Covenants) Act 1995 prohibit tenants from assigning their leases to their guarantors...

United KingdomReal Estate and Construction
Rebecca Noble
Rebecca Noble
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A recent decision has confirmed that the anti-avoidance provisions in the Landlord and Tenant (Covenants) Act 1995 ("the Act") prohibit tenants from assigning their leases to their guarantors, because doing so would frustrate the purpose of the Act.

"It would also appear to mean that the lease could not be assigned to the guarantor, even where both tenant and guarantor wanted it." Lord Neuberger; K/S Victoria Street v House of Fraser (Stores Management) Limited [2011]

This issue, which was considered but not decided upon in 2011 by Lord Neuberger, recently came before the High Court in the case of EMI Group Limited v O&H Q1 Limited [2016] EWCH 529 (Ch) and Lord Neuberger's suggested approach has been followed.

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