tenant, it may be said to touch and concern the land’ ( per Lord Oliver) o Here, a covenant to pay a deposit guaranteeing the fulfilment of tenant covenants did NOT touch and concern the land Examples: o T covenants which touch and concern the land – To pay rent; to repair; to decorate; to insure the premises o L covenants which touch and concern the land – To renew the lease at the end of the term; to supply the premises with water o Covenants which DO NOT touch and concern the land – Not to employ certain persons; to pay the T compensation at the end of the lease if a new lease is not granted Duration of liability : privity of estate only lasts for the period that the lease is vested in the T – T is not liable for breaches of his predecessor, and will not be liable for breaches once he himself assigns the lease o Will continue however to be liable for breaches which occurred during his tenancy o And will be liable if he has covenanted directly with the L ( Estates Gazette v Benjamin Restaurants ) Liability of the original T: o At common law: privity of contract so original T remains liable at common law for the entire term of the lease o But the original T can seek to recover damages paid due to the actions of a defaulting assignee At common law: the rule in Moule v Garrett – where someone is compelled to pay damages due to the legal default of another, the former is entitled to recover damages from the defaulting party – thus the original T can sue his successor (T1) By statute : In unregistered land - s77 LPA 1925 creates an implied chain of indemnity and in registered land, the original T may rely on schedule 12, para 20 LRA 2002 Express covenants : there may be an express chain of indemnity covenants – this will be necessary in case of a gift of a lease in unregistered land, to which s77 does not apply 2
Revision: Land [ RUNNING OF LEASEHOLD COVENANTS ] But : indemnity route is unsatisfactory in practice – if the successor (T1) was worth suing, then the L would have gone after them in the first place! Assignment of the Reversion Rules in s141 (passes the benefit) and 142 LPA 1925 (passes the burden) – similar to Spencer’s Case - covenants must have ‘reference to the subject matter of the lease’ (treated synonymously with requirement Re King : new L can sue for pre-existing breaches, and the old L loses the right to sue – confirmed in Arlesford Trading v Servansingh – new L can sue the original T even though there never privity of contract OR estate Limits on s142 LPA 1925 : L’s covenant to renew the lease at the end of the term is classed as a separate interest in land (estate contract) and thus must be registered (Class C (iv) land charge or notice on the charges register for registered land) Sub-Tenants No privity : there is no privity of estate and no privity of contract between the head landlord and a sub- tenant – so the head landlord cannot usually enforce vs. a sub-tenant Ways around this: 1. Indirect Enforcement: s79 LPA 1925 –
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- Fall '19
- Contract Law, Leasehold estate, LRA, Privity of Estate