The Zurich has closed its Zurich Building Guarantee business, covering new home warranties and building control.

When the right to enfranchise (to buy the freehold) was introduced by LRA 1967, there was a requirement that T had occupied the premises as a ‘residence’ for at least five years. That five-year period was reduced to three years in 1993, and the residence requirement was largely abolished by CLRA 2002.

Under CLRA 2002 the standard test is now one of two years of ownership (not residence). As far as businesses are concerned, the right to enfranchise does not apply to an LTA 1954 business tenancy, unless T has been occupying the ‘house’ as his ‘residence’ for at least two years (which would be impossible for a company).

The Remedies Directive came into force on 20 December 2009, with a view to encouraging greater transparency in the procurement process (in particular, to reduce the number of ‘direct awards’, where contracts are awarded without an OJEU advert). This has been done by giving greater remedies to aggrieved bidders and encouraging them to litigate in the case of a breach. In particular there are:

enhanced notice requirements: the old ‘two-stage’ approach where bidders could ask for more information within two working days has been scrapped. Now, all information has to be given up-front by the issue of an ‘award-decision notice’ to everyone who submitted a bid. This will include the award criteria, the reasons for the decision, and the score of the winner (and of the person sent the notice);

The Building Societies Association issued a standard set of mortgage instructions at the beginning of January. These will apply in residential transactions involving BSA members (which includes most of the major societies).

The Supreme Court has upheld the right of a developer to connect to a public sewer, even if the statutory undertaker is concerned that the additional discharge will overburden the sewage system. The cost of any necessary works will fall on the sewage undertaker (and not on the developer).

Two recent CA decisions on the use of rights of way to allow access to development land. Together, they show a non-restrictive approach:

L might be tempted to generate some cash by allowing an empty property to be occupied on a short-term let.

One complication to think about is dilapidations. If L is still pursuing a dilapidations claim against a former T, then granting a new tenancy (however short) could give rise to an argument that the dilapidations claim should fail because L has suffered no loss (through being able to re-let at a market rent). Whilst that argument may be rebuttable, it is a further complication that L will have to deal with.

If the seller goes bankrupt, then you need to distinguish between a sole proprietor and joint proprietors:

the legal estate passes to the trustee in bankruptcy, and therefore the buyer must deal with the trustee (and not the seller). If necessary, the trustee could be forced to complete the sale by an action for specific performance, although he would have a right to disclaim (s315 Insolvency Act 1986) if the contract is ‘onerous’ or at an undervalue.

Over the past year there has been much debate about the validity of virtual assignments, following a High Court decision in which it was held that a virtual assignment would nearly always be a breach of the ‘parting with possession’ covenant in a lease.

The guidance on referrals has become increasingly messy, with the latest edict on what to do if a client has a pre-existing referral arrangement.

The High Court has held that if T is in administration, and the company continues to use the premises, then the rent due to L must be paid as an expense of the administration. Thus, rent will rank ahead of sums due to preferential and other unsecured creditors.

If T has gone into administration, L may well consent to an assignment of the lease to an assignee. In that situation, can L then sue the assignee for the earlier rent arrears?

If a developer faces injunction proceedings because a development is argued to be in breach of a restrictive covenant, then it is possible to apply for a stay of the injunction proceedings, with leave to apply to the Lands Tribunal under s84(1) LPA 1925. For instance, this would be the obvious route if there had been a radical change in the neighbourhood so that it seemed highly likely that the Tribunal would vary or discharge the covenant.

Insurance may seem the easy way of side-stepping the potential problems raised by a restrictive covenant. But, do bear in mind that:

A summary of the main occasions when you should decline to act:

where it would involve you in a breach of professional conduct (eg undisclosed contract race);

if you lack the expertise to carry out the client’s instructions confidently;

Suppose a fee-earner wants to close a file, but there is a small client balance left over in client account (presumably, the fee-earner miscalculated the sums at some stage). In that situation, can you simply transfer the balance to a general or suspense client ledger?

Accounts Rule 18, dealing with controlled trust money, was recently repealed. The end result is that solicitors are now permitted to include trust money within their client bank accounts.

Most people will think of an ‘annoyance or nuisance’ covenant as applying solely to activities carried out on a property (eg disturbance coming from a building). But, that is wrong, since the covenant can also cover the erection of the building itself.

Under Landlord and Tenant (Covenants) Act 1995, if T assigns a ‘new’ tenancy, then T will only remain liable if an Authorised Guarantee Agreement (AGA) is signed to that effect. But, the release provisions for Ls are slight different. Under s6, if L assigns the reversion in the whole of the premises then L must apply to T to be released. The logic of this is that whereas L will usually have some measure of control over who comes in as T (through the terms of the lease), T will not usually have any corresponding control in respect of the assignee of the reversion. In other words, L can usually sell to whomsoever he wishes, and thus the requirement that L has to apply for a release will go some way towards redressing that balance of power.

Most unmarried couples in a dispute over property must rely upon TOLATA [1996], which deals with trusts of land (whether express, implied, resulting or constructive).

Virtual assignments are still commonplace in large corporate transactions. For instance, if a seller has dozens of leasehold properties it may not be practical to apply for consent to assign for each property before completion of the deal. Formal consent will often only be applied for after completion of the transaction, with a virtual assignment being used as a stop-gap until the formal consent of L is obtained. On other occasions, no formal consent will ever be obtained and the parties will simply rely upon the virtual assignment.

Your clients want to exchange contracts subject to getting planning permission. Accordingly, you negotiate an exchange on the basis that completion will be 21 days after the grant of planning permission, so that if the planning application is refused (after appeal), then the sale contract is to lapse. What can possibly go wrong?