It seems that barely a year goes by without a break clause
related tale of woe emanating from the Courts.
Sackville Property Select II (GP) No.1 Ltd & Anor v
Robertson Taylor Insurance Brokers Ltd & Anor can be added
to that ever expanding tome. In that case the Court considered the
validity of a tenant's break notice, served by an assignee who
had not yet registered the title in its name at the Land
Registry.
When it comes to registered land, you only become the legal
owner once you are registered at the Land Registry. In the interim
the outgoing owner remains the legal owner, and holds the property
on trust for the new owner until the registration goes through.
In this case, the assignee hadn't yet registered the
transfer of the lease in its name when it served the break notice.
This was held to be fatal to the validity of the notice. Only
the legal owner – the previous holder of the lease, the
assignor – could have exercised the break.
