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Landlord Protect Ltd v St Anselm Development Co Ltd [electronic resource]

Language: English Publication details: 2008Subject(s): Online resources: Summary: [2008] EWHC 1582 (Ch) 8 July 2008. The head landlords of a block of flats were acting reasonably in requiring as a condition of their consent to the assignment of the head lease that a guarantee to be provided in respect of the assignee's obligations should be released upon any future assignment of the head lease only if a reasonable alternative security was provided by the future assignee. The assignee's refusal to comply with this was a breach of contract and the head landlords were not obliged to return the deposit. Claimant (L) claimed against defendant (S) for the return of a deposit paid by it to S for the purchase of the head leasehold interest in a block of flats. Held: The head landlords were not able to ask for a guarantor throughout the term of the head lease, as this would provide them with more rights than they were entitled to under the lease. As they did not insist upon a guarantor, but rather 'a reasonable alternative security', this provision was capable of being provided by the covenant of the proposed assignee itself and provided no extra rights for the head landlords. They were right to withold the deposit after L tried to rescind the contract, as the provision that they insisted upon did not go beyond their right to give consent.
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Law report Virtual Online ONLINE PUBLICATION (Browse shelf(Opens below)) 1 Available 144537-1001

[2008] EWHC 1582 (Ch) 8 July 2008. The head landlords of a block of flats were acting reasonably in requiring as a condition of their consent to the assignment of the head lease that a guarantee to be provided in respect of the assignee's obligations should be released upon any future assignment of the head lease only if a reasonable alternative security was provided by the future assignee. The assignee's refusal to comply with this was a breach of contract and the head landlords were not obliged to return the deposit. Claimant (L) claimed against defendant (S) for the return of a deposit paid by it to S for the purchase of the head leasehold interest in a block of flats. Held: The head landlords were not able to ask for a guarantor throughout the term of the head lease, as this would provide them with more rights than they were entitled to under the lease. As they did not insist upon a guarantor, but rather 'a reasonable alternative security', this provision was capable of being provided by the covenant of the proposed assignee itself and provided no extra rights for the head landlords. They were right to withold the deposit after L tried to rescind the contract, as the provision that they insisted upon did not go beyond their right to give consent.