EMI Group Ltd v O & H Q1 Ltd
A tenant is precluded under the Landlord and Tenant (Covenants) Act 1995 from assigning the tenancy to its guarantor, and any agreement seeking to give effect to such an arrangement is void by reason of section 25(1), as it frustrates the purpose of the Act. The assignment to the guarantor is therefore void and does not vest the lease in the guarantor.
- Parties
- Claimant: EMI Group Limited; Defendant: O & H Q1 Limited
- Jurisdiction
- England and Wales
- Judgment Date
- 16 March 2016
- Procedural Posture
- Civil / Judgment on Preliminary Issue
- Outcome
- Claim dismissed
- Legal Topics
- Assignment of Lease, Guarantor Liability, Landlord and Tenant (covenants) Act 1995, Anti Avoidance Provisions, Release From Covenants
Case Brief
Summary, issues, holding and outcome
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Parties
EMI Group Limited
Claimant
O & H Q1 Limited
Defendant
Procedural Posture
Civil / Judgment on Preliminary Issue
Legal Issues
- 1 Whether the Act precludes the guarantor of an assignor from becoming the assignor’s assignee
- 2 Extent to which agreements purporting to give effect to such arrangement are avoided by section 25(1) of the Act
Ratio Decidendi
A tenant is precluded under the Landlord and Tenant (Covenants) Act 1995 from assigning the tenancy to its guarantor, and any agreement seeking to give effect to such an arrangement is void by reason of section 25(1), as it frustrates the purpose of the Act. The assignment to the guarantor is therefore void and does not vest the lease in the guarantor.
Court Disposition
Claim dismissed
Orders
- Declaration that the purported assignment of the Lease to the Claimant is void and of no effect.
- Lease remains vested in the Original Tenant.
Full Case Text
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