licence to assign vs notice of assignment

Assignment of Lease

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What is an assignment of lease.

The assignment of lease is a title document that transfers all rights possessed by a lessee or tenant to a property to another party. The assignee takes the assignor’s place in the landlord-tenant relationship.

You can view an example of a lease assignment here .

How Lease Assignment Works

In cases where a tenant wants to or needs to get out of their lease before it expires, lease assignment provides a legal option to assign or transfer rights of the lease to someone else. For instance, if in a commercial lease a business leases a place for 12 months but the business moves or shuts down after 10 months, the person can transfer the lease to someone else through an assignment of the lease. In this case, they will not have to pay rent for the last two months as the new assigned tenant will be responsible for that.

However, before the original tenant can be released of any responsibilities associated with the lease, other requirements need to be satisfied. The landlord needs to consent to the lease transfer through a “License to Assign” document. It is crucial to complete this document before moving on to the assignment of lease as the landlord may refuse to approve the assignment.

Difference Between Assignment of Lease and Subletting

A transfer of the remaining interest in a lease, also known as assignment, is possible when implied rights to assign exist. Some leases do not allow assignment or sharing of possessions or property under a lease. An assignment ensures the complete transfer of the rights to the property from one tenant to another.

The assignor is no longer responsible for rent or utilities and other costs that they might have had under the lease. Here, the assignee becomes the tenant and takes over all responsibilities such as rent. However, unless the assignee is released of all liabilities by the landlord, they remain responsible if the new tenant defaults.

A sublease is a new lease agreement between the tenant (or the sublessor) and a third-party (or the sublessee) for a portion of the lease. The original lease agreement between the landlord and the sublessor (or original tenant) still remains in place. The original tenant still remains responsible for all duties set under the lease.

Here are some key differences between subletting and assigning a lease:

Under a sublease, the original lease agreement still remains in place.
The original tenant retains all responsibilities under a sublease agreement.
A sublease can be for less than all of the property, such as for a room, general area, portion of the leased premises, etc.
Subleasing can be for a portion of the lease term. For instance, a tenant can sublease the property for a month and then retain it after the third-party completes their month-long sublet.
Since the sublease agreement is between the tenant and the third-party, rent is often negotiable, based on the term of the sublease and other circumstances.
The third-party in a sublease agreement does not have a direct relationship with the landlord.
The subtenant will need to seek consent of both the tenant and the landlord to make any repairs or changes to the property during their sublease.

Here is more on an assignment of lease here .

Parties Involved in Lease Assignment

There are three parties involved in a lease assignment – the landlord or owner of the property, the assignor and the assignee. The original lease agreement is between the landlord and the tenant, or the assignor. The lease agreement outlines the duties and responsibilities of both parties when it comes to renting the property. Now, when the tenant decides to assign the lease to a third-party, the third-party is known as the assignee. The assignee takes on the responsibilities laid under the original lease agreement between the assignor and the landlord. The landlord must consent to the assignment of the lease prior to the assignment.

For example, Jake is renting a commercial property for his business from Paul for two years beginning January 2013 up until January 2015. In January 2014, Jake suffers a financial crisis and has to close down his business to move to a different city. Jake doesn’t want to continue paying rent on the property as he will not be using it for a year left of the lease. Jake’s friend, John would soon be turning his digital business into a brick-and-mortar store. John has been looking for a space to kick start his venture. Jake can assign his space for the rest of the lease term to John through an assignment of lease. Jake will need to seek the approval of his landlord and then begin the assignment process. Here, Jake will be the assignor who transfers all his lease related duties and responsibilities to John, who will be the assignee.

You can read more on lease agreements here .

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Assignment of Lease From Seller to Buyer

In case of a residential property, a landlord can assign his leases to the new buyer of the building. The landlord will assign the right to collect rent to the buyer. This will allow the buyer to collect any and all rent from existing tenants in that property. This assignment can also include the assignment of security deposits, if the parties agree to it. This type of assignment provides protection to the buyer so they can collect rent on the property.

The assignment of a lease from the seller to a buyer also requires that all tenants are made aware of the sale of the property. The buyer-seller should give proper notice to the tenants along with a notice of assignment of lease signed by both the buyer and the seller. Tenants should also be informed about the contact information of the new landlord and the payment methods to be used to pay rent to the new landlord.

You can read more on buyer-seller lease assignments here .

Get Help with an Assignment of Lease

Do you have any questions about a lease assignment and want to speak to an expert? Post a project today on ContractsCounsel and receive bids from real estate lawyers who specialize in lease assignment.

Meet some of our Assignment of Lease Lawyers

The Law Office of David Watson, LLC provides comprehensive and individualized estate-planning services for all stages and phases of life. I listen to your goals and priorities and offer a range of estate-planning services, including trusts, wills, living wills, durable powers of attorney, and other plans to meet your goals. And for convenience and transparency, many estate-planning services are provided at a flat rate.

My career interests are to practice Transactional Corporate Law, including Business Start Up, and Mergers and Acquisitions, as well as Real Estate Law, Estate Planning Law, Tax, and Intellectual Property Law. I am currently licensed in Arizona, Pennsylvania and Utah, after having moved to Phoenix from Philadelphia in September 2019. I currently serve as General Counsel for a bioengineering company. I handle everything from their Mergers & Acquisitions, Private Placement Memorandums, and Corporate Structures to Intellectual Property Assignments, to Employment Law and Beach of Contract settlements. Responsibilities include writing and executing agreements, drafting court pleadings, court appearances, mergers and acquisitions, transactional documents, managing expert specialized legal counsel, legal research and anticipating unique legal issues that could impact the Company. Conducted an acquisition of an entire line of intellectual property from a competitor. In regards to other clients, I am primarily focused on transactional law for clients in a variety of industries including, but not limited to, real estate investment, property management, and e-commerce. Work is primarily centered around entity formation and corporate structure, corporate governance agreements, PPMs, opportunity zone tax incentives, and all kinds of business to business agreements. I have also recently gained experience with Estate Planning law, drafting numerous Estate Planning documents for people such as Wills, Powers of Attorney, Healthcare Directives, and Trusts. I was selected to the 2024 Super Lawyers Southwest Rising Stars list. Each year no more than 2.5% of the attorneys in Arizona and New Mexico are selected to the Rising Stars. I am looking to further gain legal experience in these fields of law as well as expand my legal experience assisting business start ups, mergers and acquisitions and also trademark registration and licensing.

Atilla Z. Baksay is a Colorado-based attorney practicing corporate and securities attorney. Atilla represents clients in the negotiation and drafting of transactional (e.g. master service, purchase and sale, license, IP, and SaaS agreements) and corporate (e.g. restricted stock transfers, stock options plans, convertible notes/SAFE/SAFT agreements, bylaws/operating agreements, loan agreements, personal guarantees, and security agreements) contracts, in-house documents (e.g. employment policies, separation agreements, employment/independent contractor/consultant agreements, NDAs, brokerage relationship policies, and office policy memoranda), and digital policies (e.g. terms of service, privacy policies, CCPA notices, and GDPR notices). Atilla also reviews, and issues legal opinions concerning, the security status of digital currencies and assets. Following law school, Atilla practiced international trade law at the Executive Office of the President, Office of the United States Trade Representative, where his practice spanned economic sanctions enacted against goods originating in the People’s Republic of China valued at $500 billion. Afterwards, Atilla joined a Colorado law firm practicing civil litigation, where the majority of his practice comprised of construction defect suits. Today, Atilla's practice spans all corporate matters for clients in Colorado and the District of Columbia.

I love contracts - and especially technology-related contracts written in PLAIN ENGLISH! I've worked extensively with intellectual property contracts, and specifically with IT contracts (SaaS, Master Subscriptions Agreements, Terms of Service, Privacy Policies, License Agreements, etc.), and I have built my own technology solutions that help to quickly and thoroughly draft, review and customize complex contracts.

I am a software developer turned lawyer with 7+ years of experience drafting, reviewing, and negotiating SaaS agreements, as well as other technology agreements. I am a partner at Freeman Lovell PLLC, where I lead commercial contracts practice group. I work with startups, growing companies, and the Fortune 500 to make sure your legal go-to-market strategy works for you.

After graduating from The University of Chicago Law School in 2002, Clara spent eight years in private practice representing clients in complex commercial real estate, merger and acquisition, branding, and other transactional matters. Clara then worked as in-house counsel to a large financial services company, handling intellectual property, vendor contracts, technology, privacy, cybersecurity, licensing, marketing, and otherwise supporting general operations. She opened her own practice in September of 2017 and represents hedge funds, financial services companies, and technology companies in a range of transactional matters.

Founder and owner of Grant Phillips Law.. Practicing and licensed in NY, NJ & Fl with focus on small businesses across the country that are stuck in predatory commercial loans. The firm specializes in representing business owners with Merchant Cash Advances or Factoring Arrangments they can no longer afford. The firms clients include restaurants, truckers, contractors, for profit schools, doctors and corner supermarkets to name a few. GRANT PHILLIPS LAW, PLLC. is at the cutting edge of bringing affordable and expert legal representation on behalf of Merchants stuck with predatory loans or other financial instruments that drain the companies revenues. Grant Phillips Law will defend small businesses with Merchant Cash Advances they can no longer afford. Whether you have been sued, a UCC lien filed against your receivables or your bank account is levied or frozen, we have your back. See more at www.grantphillipslaw.com

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Contract to lease land from a church.

I’m planning on leasing land from a church. Putting a gym on the property. And leasing it back to the school.

Ok; first step is that you will need a leasing contract with the church. Ask them to prepare one for you so you would just need an attorney to review the agreement and that should cost less than if you had to be the party to pay a lawyer to draft it from scratch. You need to ensure that the purpose of the lease is clearly stated - that you plan to put a gym on the land so that there are no issues if the church leadership changes. Step 2 - you will need a lease agreement with the school that your leasing it do (hopefully one that is similar to the original one your received from the church). Again, please ensure that all the terms that you discuss and agree to are in the document; including length of time, price and how to resolve disputes if you have one. I hope this is helpful. If you would like me to assist you further, you can contact me on Contracts Counsel and we can discuss a fee for my services. Regards, Donya Ramsay (Gordon)

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Insights // 24 October 2022

What is a Licence to Assign? A Summary

Partner katja wigham, in our commercial property team , explains what a licence to assign is..

A licence to assign is a landlord’s permission for a tenant (the assignor) in occupation under a lease to assign the lease to a new incoming tenant (the Assignee). It should be noted that this permission does not necessarily need to be in a formal deed. Therefore, landlords and agents should be mindful of falling into the trap of granting permission through correspondence, thereby inadvertently granting consent without the assignor and assignee having to comply with the required conditions such as providing a guarantee or rent deposit. In Aubergine Enterprises Ltd v Lakewood International Ltd (2002) it was held that consent to assignment was contained in correspondence even if was stated to be “subject to licence”.

Landlords are provided with some comfort in that if the lease contains a provision that consent must be given by deed, then this is the only way in which permission to assign can be granted. In this instance, the landlord, assignor and assignee (and guarantor if required) will be a party to the licence, which will usually be prepared in triplicate and a copy provided to each party on completion.

The licence will contain several covenants, for example a covenant between the Assignee and Landlord to observe and perform the covenants contained in the lease. The assignor may covenant to pay the landlord’s legal costs in connection with the licence and covenant not to allow the Assignee to take occupation of the premises until completion of the assignment.

Under Section 19(A) of the Landlord and Tenant Act 1927, the landlord should not unreasonably withhold consent to the assignment of the lease. If however, the lease contains provisions such as that the Assignor must not be in arrears and/or in breach of any covenants of the lease then the Landlord is entitled to withhold consent until these obligations have been complied with. The licence should incorporate a right of re-entry clause allowing the landlord to forfeit the lease owing to a tenant’s breach of covenants in the licence.

A landlord will often want the licence to include an indemnity clause whereby the assignor and the assignee will indemnify the landlord against all liabilities, losses, costs incurred and damages arising out of the licence. An assignor however is likely to want to limit the indemnity to reasonable costs and expenses, properly incurred and to their own breaches.

Finally, the permission under a licence to assign typically remains valid for three months following completion of the licence, during which time the assignor and assignee will assign the lease. If assignment does not take place within the specified time then the licence will cease to be valid and the assignor will have to start over again.

For further information or legal advice, please contact [email protected] or call 0118 951 6800.

This article is intended for the use of clients and other interested parties. The information contained in it is believed to be correct at the date of publication, but it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional advice.

Katja Wigham

Partner, Commercial Property Law

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Assignments: why you need to serve a notice of assignment

It's the day of completion; security is taken, assignments are completed and funds move. Everyone breathes a sigh of relief. At this point, no-one wants to create unnecessary paperwork - not even the lawyers! Notices of assignment are, in some circumstances, optional. However, in other transactions they could be crucial to a lender's enforcement strategy. In the article below, we have given you the facts you need to consider when deciding whether or not you need to serve notice of assignment.

licence to assign vs notice of assignment

What issues are there with serving notice of assignment?

Assignments are useful tools for adding flexibility to banking transactions. They enable the transfer of one party's rights under a contract to a new party (for example, the right to receive an income stream or a debt) and allow security to be taken over intangible assets which might be unsuitable targets for a fixed charge. A lender's security net will often include assignments over contracts (such as insurance or material contracts), intellectual property rights, investments or receivables.

An assignment can be a legal assignment or an equitable assignment. If a legal assignment is required, the assignment must comply with a set of formalities set out in s136 of the Law of Property Act 1925, which include the requirement to give notice to the contract counterparty.

The main difference between legal and equitable assignments (other than the formalities required to create them) is that with a legal assignment, the assignee can usually bring an action against the contract counterparty in its own name following assignment. However, with an equitable assignment, the assignee will usually be required to join in proceedings with the assignor (unless the assignee has been granted specific powers to circumvent that). That may be problematic if the assignor is no longer available or interested in participating.

Why should we serve a notice of assignment?

The legal status of the assignment may affect the credit scoring that can be given to a particular class of assets. It may also affect a lender's ability to effect part of its exit strategy if that strategy requires the lender to be able to deal directly with the contract counterparty.

The case of General Nutrition Investment Company (GNIC) v Holland and Barrett International Ltd and another (H&B) provides an example of an equitable assignee being unable to deal directly with a contract counterparty as a result of a failure to provide a notice of assignment.

The case concerned the assignment of a trade mark licence to GNIC . The other party to the licence agreement was H&B. H&B had not received notice of the assignment. GNIC tried to terminate the licence agreement for breach by serving a notice of termination. H&B disputed the termination. By this point in time the original licensor had been dissolved and so was unable to assist.

At a hearing of preliminary issues, the High Court held that the notices of termination served by GNIC , as an equitable assignee, were invalid, because no notice of the assignment had been given to the licensee. Although only a High Court decision, this follows a Court of Appeal decision in the Warner Bros Records Inc v Rollgreen Ltd case, which was decided in the context of the attempt to exercise an option.

In both cases, an equitable assignee attempted to exercise a contractual right that would change the contractual relationship between the parties (i.e. by terminating the contractual relationship or exercising an option to extend the term of a licence). The judge in GNIC felt that "in each case, the counterparty (the recipient of the relevant notice) is entitled to see that the potential change in his contractual position is brought about by a person who is entitled, and whom he can see to be entitled, to bring about that change".

In a security context, this could hamper the ability of a lender to maximise the value of the secured assets but yet is a constraint that, in most transactions, could be easily avoided.

Why not serve notice?

Sometimes it's just not necessary or desirable. For example:

If security is being taken over a large number of low value receivables or contracts, the time and cost involved in giving notice may be disproportionate to the additional value gained by obtaining a legal rather than an equitable assignment.
If enforcement action were required, the equitable assignee typically has the option to join in the assignor to any proceedings (if it could not be waived by the court) and provision could be made in the assignment deed for the assignor to assist in such situations. Powers of attorney are also typically granted so that a lender can bring an action in the assignor's name.
Enforcement is often not considered to be a significant issue given that the vast majority of assignees will never need to bring claims against the contract counterparty.

Care should however, be taken in all circumstances where the underlying contract contains a ban on assignment, as the contract counterparty would not have to recognise an assignment that is made in contravention of that ban. Furthermore, that contravention in itself may trigger termination and/or other rights in the assigned contract, that could affect the value of any underlying security.

What about acknowledgements of notices?

A simple acknowledgement of service of notice is simply evidence of the notice having been received. However, these documents often contain commitments or assurances by the contract counterparty which increase their value to the assignee.

Best practice for serving notice of assignment

Each transaction is different and the weighting given to each element of the security package will depend upon the nature of the debt and the borrower's business. The service of a notice of assignment may be a necessity or an optional extra. In each case, the question of whether to serve notice is best considered with your advisers at the start of a transaction to allow time for the lender's priorities to be highlighted to the borrowers and captured within the documents.

For further advice on serving notice of assignment please contact Kirsty Barnes or Catherine Phillips from our Banking & Finance team.

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Commercial lease assignments: A guide for businesses

Business owners often consider commercial lease assignments to enhance flexibility, mitigate financial burdens, or adapt to evolving operational requirements.

The work landscape, particularly in cities like London, is also evolving with the widespread adoption of remote and hybrid models, with many tenants seeking to streamline their footprints and reduce overhead costs.

Whether your business is looking for a more suitable space or navigating market fluctuations, this article will give you an overview of the lease assignment process and the essential legal aspects to consider.

What is the assignment of a lease?

The assignment of a lease refers to the legal process through which a tenant transfers their lease obligations and rights to another party, known as the assignee. This strategic move allows businesses to exit their premises before the lease term ends, with the assignee assuming responsibility for complying with the lease terms and obligations.

Businesses may consider lease assignment for various reasons, such as relocation, financial constraints, or changes in business needs. For instance, a company experiencing rapid growth may seek more extensive premises, making lease assignment an attractive option to exit the current arrangement.

What role does a solicitor play?

Understanding the legal complexities is vital when considering the assignment of a commercial lease. In this process, solicitors offer expert advice and can negotiate with the landlord to secure favourable terms within the assignment agreement, safeguarding the client's interests.

Their pivotal role extends to drafting and finalising essential legal documents associated with lease assignments, such as:

Licence to assign: A solicitor can assist in drafting this document, ensuring that it covers all necessary conditions and terms for the assignment, meets legal requirements, and protects the interests of both parties.
Rent deposit deed: Solicitors can draft the rent deposit deed, specifying the details of the deposit arrangement, its purpose, and the conditions under which the landlord can use the deposit, providing legal clarity for both parties.
Authorised guarantee agreement (AGA): Solicitors are instrumental in creating an AGA, outlining the legal commitment by the outgoing tenant to guarantee the new tenant's performance. They ensure that the agreement is comprehensive and legally sound, protecting the interests of the landlord and the outgoing tenant.

Avoiding the legal pitfalls of lease assignments

While every commercial lease assignment is unique, several legal aspects require careful consideration.

1. Leasehold covenants: Ensuring compliance

Understanding leasehold covenants is essential in the lease assignment process as it involves recognising and complying with the agreed-upon obligations and restrictions outlined in the lease agreement. These covenants dictate how the property can be used, any alterations or improvements allowed, and other conditions the current and potential tenants must adhere to.

For example, if a leasehold covenant stipulates that the premises can only be used for office purposes, you cannot assign the lease to a manufacturing company.

Failure to understand and meet these covenants could lead to complications, including the landlord's refusal to consent to the assignment or potential legal issues. Comprehending these covenants is essential for a smooth and legally compliant lease assignment.

2. Securing the landlord's consent: A prerequisite

Before proceeding with a lease assignment, obtaining the landlord's consent is paramount. This process involves submitting a formal request providing details about the proposed assignee and their financial stability.

While landlords cannot unreasonably withhold consent, specific lease terms may give them grounds to do so. Understanding the particular conditions for refusal is crucial, so it is important to seek legal advice as soon as possible.

3. Liabilities when assigning a commercial lease

Understanding liabilities when assigning a lease is crucial for business owners as it directly impacts their ongoing responsibilities and potential financial obligations. Transferring a lease doesn't automatically absolve the original tenant of all liabilities; they may still be held accountable if the new tenant defaults on payments or breaches lease terms.

An authorised guarantee agreement (AGA) is a legal commitment often used in the context of commercial lease assignments. When a tenant assigns its lease to a new tenant, the outgoing tenant (assignor) may be required to provide an AGA. This agreement serves as a guarantee by the original tenant to the landlord, ensuring that the obligations of the new tenant (assignee) under the lease will be fulfilled.

The AGA means that if the new tenant defaults on the lease obligations, the outgoing tenant remains liable, guaranteeing the landlord a level of financial security. The original tenant can be pursued for any unpaid rent or other breaches of the lease terms by the new tenant. The AGA provides a legal mechanism for the landlord to seek redress from the outgoing tenant if issues arise with the assigned lease.

Clear comprehension of these liabilities ensures informed decision-making and risk mitigation during the lease assignment process.

4. Navigating regulatory changes

The evolving regulatory landscape, particularly factors like Energy Performance Certificates (EPCs), can add additional challenges to lease assignments. For example, if you took on a lease before Minimum Energy Efficiency Standards (MEES) came into effect on April 1, 2018, the regulations did not apply at the time of the lease's inception. However, if you are now considering assigning the lease, MEES regulations would be applicable.

A landlord may be less willing to agree to the lease assignment if it becomes essential to ensure that the property meets the required EPC standards to comply with the current regulations.

5. Formalising with Land Registry: A vital step

Registering an assignment with the Land Registry is an important step in the lease assignment process. If a lease is granted with a term of over seven years, it must be registered to record the change of tenant officially.

Failure to complete this registration can have significant consequences, including potential challenges to the validity and enforceability of the assignment.

What are the alternatives to assigning a commercial lease?

When considering an exit from a commercial lease, it's crucial to recognise that assignment is just one of several options. Exploring these options is vital, and seeking guidance from a solicitor ensures a comprehensive understanding of the available choices.

Assignment vs. subletting: Assignment involves permanently transferring your lease obligations to a new tenant. On the other hand, subletting a commercial property allows you to lease a part of your space to another party, retaining your responsibility for the entire lease.
Taking advantage of a 'break clause': A break clause is a provision in the lease allowing either party to terminate the agreement early, typically at predefined intervals. It provides a strategic exit, but conditions and notice periods must align with the lease terms.
Early termination with landlord's consent: Seeking your landlord's agreement to terminate the lease prematurely can be challenging. It requires negotiations and may involve financial considerations. Legal advice is essential to navigate this complex process and safeguard your interests.

Business owners can make informed decisions that align with their strategic objectives by understanding the intricacies, exploring alternatives, and leveraging legal expertise.

Commercial lease expertise

Our team of experienced commercial property solicitors is dedicated to guiding you through the lease assignment process. Every business has unique needs, so we offer tailored advice that aligns with your objectives.

In addition to lease assignments, we can provide guidance on alternative options for ending a commercial lease, such as subletting, break clauses, and lease termination.

With solicitors in London, Brighton, East Sussex, and Cumbria, we assist commercial landlords and tenants nationwide.

Looking to assign a commercial lease?

You might also like to read:

Subletting strategies: maximising flexibility in commercial leases, how to surrender a commercial lease: a guide for landlords and tenants.

How to end a commercial lease early: A quick guide

Repair clauses in commercial leases: what tenants need to know.

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Shared ownership leases: a quick-fire guide to assignments

In this quick-fire guide, we outline the steps social landlords should take when assigning a shared ownership lease to ensure the process runs smoothly:

Use a license

Unless the leaseholder has staircased to 100%, the landlord’s consent will be required to assign the lease. To provide evidence of this consent, enter into a licence to assign, and state that the buyer and seller should do the same.

There was a series of model leases issued between 2012 and 2015, which required the buyer to enter into a direct deed of covenant with the landlord, but using a license to assign will enable you to do both in one document.

Establish who is approving the mortgage offer

Every shared ownership mortgage offer requires landlord approval or it won’t benefit from the mortgagee protection clause. Establish from the outset whether the housing association, or its solicitors, will be approving mortgage offers, and what their criteria will be.

Be clear on leasehold information

All leasehold sales, shared ownership or outright, will require a pack of standard information such as confirmation that rent and service charges aren’t in arrears, if any major works are planned, and if the landlord has taken steps to forfeit and close the lease. These packs often take a lot of time to produce, and once provided, there are usually further questions. Ensure you’re being clear with your leaseholders about how they get this information from you, and how much it will cost to produce this pack.

Take expert advice

Most legal titles are the same but it’s important to get them checked as some information may not be immediately clear. Specialist lawyers will be able to quickly review multiple titles and leases, and conclude precisely what documentation is required.

Do your homework on notices and compliance certificates

The majority of leases require the buyer to serve notice on the landlord formally declaring they are the legal owner. There is also usually a restriction at HM Land Registry to ensure the landlord confirms the lease has been complied with before the new buyer is registered – the buyer will require a certificate to satisfy this restriction. Confirm who is providing the certificates, how much they are charging, and what information will be needed before it is issued.

By taking these steps and being clear with your people about who is responsible for key tasks, the assignment process should be straightforward and you will avoid any potential pitfalls.

For further information on staircasing or assigning an existing lease, please speak to Alasdair Muir or Lale Ali in our Real Estate and Projects Team .

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Licence to Assign

When selling a leasehold property a licence to assign may be required if stated within the lease. Brady Solicitors can manage one or a ll of your l icence to assign work following a simple introduction to the leaseholders.

What is a licence to assign?

A licence to assign is the formal document detailing the landlord’s permission for a leaseholder selling their property to assign the lease to the new incoming leaseholder purchasing their property. This then makes the incoming leaseholder responsible for the leaseholder duties within the lease.

When assessing whether to approve a licence to assign request there are a number of aspects to check, such as whether the ground rent and service charges are paid up to date. Whilst some managing agents have the capacity to manage these assessment themselves, a large proportion of managing agents prefer to use expert solicitors to carry out all their licence to assign work.

Brady Solicitors’ experts can:

Liaise directly with the leaseholder’s solicitors following a simple introduction from their managing agent.
Carry out all of the necessary assessments to confidently approve a licence to assign request.
Invoice the leaseholder directly, removing any potential cost to the managing agent.
Provide the managing agent with all of the relevant documentation upon completion to keep on file to aid with good estate management.
Work within a time frame to suit the requirements of the leaseholder and freeholder or managing agent.
Turn a licence around within 3 days when required to do so.
Provide a notice of transfer or a notice of charge for the purchasing/incoming leaseholder.

Take the next step

Get in touch with any questions regarding licence to assign or if you would like Brady Solicitors to manage one or all of your licence to assign projects.

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Help with the licence to assign process

For advice and assistance with providing a licence to assign, contact Bradys’ specialist leasehold solicitors.

Navigating the assignment of a commercial lease

Special circumstances can require a tenant or a landlord to assign a commercial lease. Find out the most common situations for a commercial lease assignment and whether it's right for your situation.

Find out more about real estate and business

by Ronna L. DeLoe, Esq.

Ronna L. DeLoe is a freelance writer and a published author who has written hundreds of legal articles. She does...

Tenant's assignment of a commercial lease

There are many reasons a tenant may want to get out of a commercial lease, including not being able to afford the rent and needing less or more space. Because it's unlikely a landlord will simply let you walk away from your commitment, you should check what your lease says about early termination. Most commercial leases require the tenant to pay rent for the rest of the term and possibly additional fees for breaking the lease.

Assignment of the lease is another alternative to breaking it. In doing so, you give the new tenant, known as the assignee, the right to occupy the premises in your place for the remainder of your lease term.

Getting the landlord's consent

Almost all assignments of commercial leases by the tenant need the landlord's consent, so check your original lease for any such language. As with a residential lease, a landlord cannot unreasonably withhold consent for you to assign the lease. However, it's up to you as the assignor, or original tenant, to ensure that your assignee is reliable, responsible, and can pay the rent—or you may end up being held financially liable.

If the tenant assigns a commercial lease to a new tenant without the landlord's permission, the landlord can sue the original tenant for breaking the lease. The landlord can also collect damages against one or both tenants if he can show that the assignee isn't a good-paying tenant or doesn't have the type of business he wants in the building. He can also end the lease and evict the new tenant.

Contents of a tenant's assignment agreement

Assignment of a commercial lease is almost always accompanied by a written agreement to preserve both the tenant's and landlord's rights. Some states require written assignment agreements . Many commercial assignment agreements contain provisions for the:

Payment of fees to the landlord for having another business substitute for yours
Assignor's and assignee's names, addresses, and business names
Landlord's name, address, and business name
Amount of the new tenant's rent and the dates for payment
Date of the agreement
Date the assignment is effective
Date the lease ends
The landlord's, assignor's, and assignee's signatures

Assignment agreements usually don't contain a provision releasing the assignor from paying rent, meaning that you, as the assignor, are held responsible for payment. Even so, assignment can be a financially responsible option for a tenant who's going out of business or who needs new space immediately.

Landlord's assignment of a commercial lease

Sometimes a commercial landlord needs to sell his property. After the new owner, or assignee-buyer, buys the property subject to existing leases, the assignor-landlord assigns the leases to the new owner, who can then collect rent. The assignor-landlord notifies tenants by sending a notice of sale, a notice of assignment of lease, or a notification on letterhead listing the assignee-buyer's address for payment of rent.

Unless the lease states otherwise, you, as landlord, can sell your property to anyone, but make sure to get a hold harmless clause , also known as an indemnity clause, in your contract of sale. Such clauses protect you from liability to the tenant if the buyer doesn't perform her duties as a landlord. Otherwise, as the original landlord, you're still liable for your obligations to the tenant, such as keeping the premises habitable.

Under the right circumstances, assignment of a commercial lease can work for both landlords and tenants. If you need assistance with your assignment agreement, consider using an online service provider to prepare it for you.

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Assignment Of Lease: A Brief Look

What is an Assignment? Simply put, it is a transfer of an existing lease by the current tenant to a new tenant with the consent of the landlord.

Let’s see how this works in practice.

To begin with, there should be an existing lease between a landlord and tenant. And the Assignee. The Assignee is the crucial factor that makes Assignment work. He or it is the newcomer to whom the existing lease will be assigned or passed or transferred to. Why does an assignment take place?

It happens for several reasons. Existing tenant want to leave for reasons, usually due to business not doing well, Age, retirement are just a few. Or, someone new comes into the area and wants to take over the lease for their prospective venture. This often is the case.

In legal jargon, the old tenant who wants to get out of the lease is called the Assignor and the new person who wants to get the remainder of the lease is called an Assignee. The landlord remains the same.

What happens next?

1. In practice, the Assignor will instruct his solicitors that he wants to assign the lease. 2. The Assignee will instruct his own solicitors that he wants to buy that lease. 3. The Assignor’s solicitors will contact the landlord’s solicitors about the proposed assignment, asking the landlord’s consent for the transaction to take place. As can be seen there will be three different solicitors involved.

Who pays the legal fees?

The parties will foot their own legal bill except for the Landlord. It’s common practice that the Assignee pays the landlord’s legal fees in addition to his own.

What does the Landlord’s solicitor do?

The solicitor will take instructions from his client as to whether the landlord is willing to give consent for the proposed assignment. And, before such consent can be given, the solicitor will ask the Assignor to provide satisfactory references for the Assignee. These are usually bank and trade references confirming that the proposed assignee is solvent and capable of paying the rent on the lease.

Upon satisfactory receipt of references, the landlord’s solicitors will draft the following documents:

1. Licence to assign 2. Rent deposit deed 3. Authorised guarantee agreement

These will be sent to the Assignor who in turn will send them to the Assignee’s solictors. These are legally binding contractual documents and need to be thoroughly perused before the parties put their signatures on them.

Briefly let’s look at what the above three documents are:

Licence to Assign is the document that enables the current tenant (Assignor) to transfer the lease to the Assignee (incoming tenant) with the landlord’s permission (consent). All three parties will sign this document.

A landlord usually requires a rent deposit as a precondition to providing its consent to the assignment of a lease. A rent deposit is a sum of money provided by the Assignee (who will become the new tenant) to the landlord as security for payment of the rent and performance of the tenant’s covenants in the lease. A rent deposit is attractive to landlords because it is an immediately accessible source of money that can be withdrawn as soon as the tenant is in breach of a relevant covenant in the lease.

An Authorised Guarantee Agreement is a legal document where the outgoing tenant (Assignor) must guarantee the performance, by the assignee, of the covenants from which the tenant has been released. In the event that the Assignee is in breach of any of the Covenants, the outgoing tenant agrees to bear the burden. This is a very important piece of legal document that merits its own article.

All leases are different. And it is always best to look at the requirements of the lease and understand what is needed before you can assign your lease.

If you would like to talk more about this topic, contact Krish Thirugnanamoorthy on 0118 947 8638 for a free quotation or email [email protected]

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September 2015 | Legal Briefing

Licence to assign: some practical tips

Almost all commercial leases prevent the tenant from assigning the lease without obtaining consent from the landlord. Disputes often arise and landlords, in particular, have to act quickly. The consequences of making a late decision are often no better than making the wrong decision: in either case, the landlord may end up with an undesirable new tenant or be stuck with a disgruntled existing tenant seeking damages. It is therefore important for both landlords and tenants to understand when the landlord is entitled to refuse consent.

THE LAW IN BRIEF

Any covenant restraining assignment without licence or consent is deemed to be subject to a proviso that the licence is not to be unreasonably withheld: s19(1) Landlord and Tenant Act 1927. It is not possible to contract out of this requirement by express agreement.

However, the parties are able to contract, when the lease is granted, for circumstances in which the landlord will be entitled to refuse consent: s19(1A) Landlord and Tenant Act 1927. (This only applies to new tenancies, as defined by the Landlord and Tenant (Covenants) Act 1995).

If an application for consent is made, the landlord must either give consent or provide written reasons for withholding it, within a reasonable time: s1 of the Landlord and Tenant Act 1988.

A reasonable time is to be judged by reference to what has actually happened in each individual case – so if, for example, the landlord asks for more information promptly and the tenant is slow to provide it, the landlord will be entitled to a reasonable time to consider the information after the tenant has provided it, providing that it was reasonable for the landlord to ask for that information in the first place. The time for responding will sometimes have to be measured in weeks rather than days, but even in complicated cases it should be measured in weeks and not months: Go West v Spigarolo [2003].  

If the landlord complies with the duty to respond to the application within a reasonable time, but refuses consent, they cannot later rely on any grounds other than those put forward in the written notice: Footwear Corporation v Amplight Properties Ltd [1999]. If the landlord refuses on one of the grounds set out in the lease, this cannot be challenged. However, if the landlord refuses on a ground which is not set out in the lease, it all turns on whether it was reasonable for the landlord to withhold consent on those grounds. Equally, if consent is given subject to conditions, those conditions must be reasonable; otherwise the landlord will be in breach of their duty.

Reasonableness is to be judged by reference to the impact on the landlord’s reversion and the rights which the landlord enjoys under the lease. It is a question of fact, in each case, depending on all the circumstances whether consent has been reasonably refused, though general guidance can be found in the Court of Appeal’s decision in International Drilling Fluids v Louisville Investments (Uxbridge) [1986]. That guidance remains good law, except that the burden of proving consent was reasonably withheld now rests with the landlord, rather than with the tenant: s1(6) of the 1988 Act. In principle, the Equality Act 2010 imposes another layer of regulation since it prevents landlords from ‘discriminating’ against  tenants when deciding whether to grant consent. But, in practice, it is quite difficult  to envisage circumstances where a refusal  to consent would only be invalidated by the anti-discrimination legislation.

Examples of circumstances in which it will often be reasonable to refuse consent include where the assignee will become entitled to enfranchise or where it will acquire statutory protection; similarly, where the proposed assignee is a business competitor of the landlord. Conversely, where a landlord’s reason for refusing consent is to obtain some collateral advantage (for example, by changing the lease terms so as to secure an increase in the sums payable or a change in the user covenant) the refusal will usually be unreasonable. Other cases fall somewhere in-between: where the landlord refuses consent because of breaches of covenant, it will all depend on the degree of seriousness of the breach and whether or not the landlord’s position is prejudiced by the assignment. Note that if the landlord does not respond to the application because it is seeking to preserve its rights to forfeit for a once-and-for-all breach, the refusal is likely to be reasonable.

If the refusal to consent is unreasonable, the tenant is entitled to assign without consent, but the safer course (for the assignee) is for the tenant to apply to the Court for a declaration that the landlord’s refusal of consent is unreasonable and that the tenant is entitled notwithstanding the refusal to make the proposed assignment. Such a declaration can be sought from either the County Court or the High Court by way of Part 8 proceedings. The parties will not always want to wait that long, however, and a sufficiently confident tenant may decide to assign without first seeking a declaration. In addition, there is nothing to stop the parties from seeking to resolve their dispute through arbitration, expert determination or any other means of alternative dispute resolution.

What happens if the landlord does not comply with their duty to respond within a reasonable time? The landlord cannot put forward any reasons justifying a refusal of consent (because there was no written notice and therefore no reasons in the written notice), and will be unable to defend themselves against a claim for a declaration that consent has been unreasonably withheld: Footwear . The importance of the written notice providing reasons for a refusal within a reasonable time cannot be overstated. The effect is almost the same as if the statute said in terms that if written reasons justifying a refusal are not provided within a reasonable time, consent is deemed to have been given but, in one respect, the position is worse than it would be if consent were deemed to have been given: a landlord who fails to serve a written notice within a reasonable time has not actually consented to the assignment and may, as a result of s4 of the 1988 Act, also be liable in damages.

A tenant wishing to claim damages has to prove that the landlord’s unreasonable refusal to consent caused it loss. A typical example is where the proposed assignee walks away and the tenant is left liable for the rent and business rates. In such cases, the courts have awarded the tenant damages to compensate it for those losses. However, the courts have also awarded exemplary damages in appropriate cases. The sums in question are not trifling: the Court of Appeal recently upheld a decision to award a tenant over £180,000 in statutory damages in Singh v Dhanji [2014].

So, what can landlords and tenants do to avoid disputes when licence to assign is sought – or at least, to avoid being in the wrong if a dispute arises?

GENERAL TIPS FOR TENANTS

Check the lease terms: it is best to know at the beginning of the process if the potential assignee does not meet any requirements specified in the lease under s19(1A) of the 1927 Act. In those circumstances, the landlord has no obligation to consent at all. That does not mean that the application should not be made, but it should inform how the tenant responds if the landlord says no, or seeks some collateral advantage or payment as a condition of granting consent.
Make the application: it is, perhaps, obvious, but it is worth stressing that the tenant will be in breach of covenant if it assigns without seeking consent, even if the landlord could not possibly have objected if asked: mistakes and forgetfulness are no defence if the assignment is made before the request for consent. Remember that the landlord’s statutory duty to respond is only triggered by a written application. Make sure that you also check the lease for any provisions about how and where to serve the application and that you retain proof of service. If the lease makes no such provision, then the application will be treated as served if it is served in accordance with s23 of the Landlord and Tenant Act 1927. It is prudent to send a copy of the application to any agents or lawyers known to be acting for the landlord, too.
Present the assignee in the best light possible: provide all useful information that a landlord might reasonably ask for, up front, when the application is made. This might usefully include information about the assignee’s business and what it intends to use the premises for, its accounts (or, if none are available, a business plan which will demonstrate an ability to meet the financial obligations under the lease), references from former landlords, banks and/or accountants, and, where appropriate, company details. If the potential assignee does meet any criteria specified under s19(1A), demonstrate that this is so.
Offer to meet the landlord’s reasonable and proper costs by giving a solicitors’ undertaking. If you want to limit the undertaking to a particular amount, consider what work is likely to be involved in considering the application, and try to make the maximum amount reasonable so as to avoid a dispute about whether the undertaking offered is sufficient. Costs are expenses incurred in relation to the grant of the licence to assign, primarily legal costs, though costs of other experts could in principle be recoverable, for example, surveyor’s costs. But what if the landlord has  in-house solicitors? Can it require the tenant to contribute to its ‘costs’, or would this fall foul of the prohibition on fines in s144 of the Law of Property Act 1925? The authors are not aware of any authority which directly addresses this question, so it must be open to doubt.
Tell the landlord what you consider to be a reasonable time frame for a response and why. If you want a speedy decision, it is wise to put down a marker early on (though of course the time frame may have to be revised in light of subsequent events). Equally, let the landlord know if you are likely to suffer loss as a result of a delay.
If no response is received in time, do not do anything to create an estoppel preventing you from relying on the failure to respond. Any ongoing correspondence after this date should, ideally, say in express terms that the tenant’s view is that a reasonable time for providing consent has passed (so the landlord cannot now advance any reasons for refusing consent) and the tenant’s rights to commence proceedings are reserved.
If the landlord does respond within a reasonable time and withholds consent , consider carefully the reasons that are put forward and whether these can sensibly be challenged. Again, any correspondence which invites the landlord to reconsider should make it clear that this is without prejudice to the tenant’s right to take proceedings based on the prior unreasonable refusal.
If you issue proceedings, consider carefully who the relevant parties should be: if you are seeking a declaration that consent has been unreasonably withheld and the consent of both the landlord and the head-landlord is required then they will both need to be joined. Equally, if the assignment has not yet been completed, then any claim will probably have to be brought by the assignor rather than by the intending assignee.

GENERAL TIPS FOR LANDLORDS

Check whether the application includes a costs undertaking: if none is given, request it before doing further work. Note that the landlord may make a charge where it is reasonable to do so even if the lease contains no specific provision for this: Holding & Management (Solitaire) v Norton [2012].
Check the lease terms: if the agreed terms are not met by the potential assignee, you are entitled to refuse, even if this would otherwise be unreasonable.
Consider any other possible grounds for refusal. Are you simply trying to preserve the value of the reversion and/or your existing rights under the lease, or are you seeking to secure an uncovenanted advantage?
Pass on the application to any superior landlord and retain proof of service: if a question arises about whether the application was properly passed on then you (as the sender) have the burden of proof. But note that you are not entitled to refuse consent simply because your own landlord does so unreasonably: Vienit v W Williams & Son (Bread Street) [1958].
If the costs undertaking offered is not sufficient, inform the tenant , giving reasons. But, do not delay commencing work on the basis that a limited amount is not likely to suffice – work up to the limit offered by the tenant while negotiating a further sum.
Inform the tenant if any further information is needed before you can decide whether to give consent. Remember that the landlord has a statutory duty to give consent, except where it is reasonable to withhold it – so if a reasonable person would ask for more information in order to consider the application, rather than rejecting it out of hand, further information should be sought. But don’t ask for more information for the sake of it, or as a way of obtaining more time: if the information isn’t reasonably required to deal with the application then the landlord will not be allowed any additional time to consider it.
Try to secure the tenant’s agreement as to a reasonable time scale , so that you know how much time you have to respond. If the tenant has set a time scale in its application, explain if you do not consider that time frame to  be realistic.
If the tenant does not provide any requested information promptly,  remind them that you cannot deal  with the application until the information is provided.
Respond within a reasonable time. If you want to refuse, it is better to respond giving all the reasons you can, than to hold off replying while one of several potential reasons is investigated. If no reply is served in time, a deemed consent will occur. But, if a bad reason is included in a notice which also contains good reasons, the bad will not invalidate the good, provided the good reasons are genuine reasons, not makeweights, and the bad reason does not bear on the good reason.
Make a decision and let the tenant know what it is: it may sound obvious but it is easy to get caught up in a lengthy exchange of informal correspondence. Don’t mistake that for an actual decision. Time will only stop running once you have notified the tenant of your decision, so make sure it is clear from the correspondence when the actual decision is being made and what it is.
Remember that the consent itself must be given within a reasonable time , not just a decision in principle: so if consent is only to be given when a formal licence is executed (and note that care is needed to bring this about effectively: see Mount Eden Land Ltd v Prudential Assurance Co Ltd (1997)), you must actually execute the licence within a reasonable time too. The authors suggest that this should be a matter of days after the decision notice is given, unless there is something very complex about the terms, though plainly much depends on the tenant’s lawyers if terms are being negotiated. The important thing is to deal with all correspondence promptly.

By Stephanie Tozer and Ciara Fairley,  barristers, Falcon Chambers.

E-mail: [email protected]; [email protected].

HAS THERE BEEN AN UNREASONABLE REFUSAL OF CONSENT?

The authors recommend working through the following questions on the facts of each case:

What is a reasonable time for written notice of the decision to be given?
Was written notice given within  that time?
Were the grounds for refusal, or conditions for grant, put forward in the notice reasonable (or agreed in the lease)?
If there were no grounds or conditions specified, is the tenant estopped from relying on this failure?

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Deed of Assignment and the Notice of Assignment -What is the Difference?

In this article, Richard Gray barrister takes a brief look at the differences between a Deed of Assignment and a Notice of Assignment and the effect of the assignment on the contracting party

At the end of 2020, Elysium Law were instructed to act for a significant number of clients in relation to claims made by a company known as Felicitas Solutions Ltd (an Isle of Man Company) for recovery of loans which had been assigned out of various trust companies following loan planning entered into by various employees/contractors.

Following our detailed response, as to which please see the article on our website written by my colleague Ruby Keeler-Williams , the threatened litigation by way of debt claims seem to disappear. It is important to note that the original loans had been assigned by various Trustees to Felicitas, by reason of which, Felicitas stood in the shoes of the original creditor, which allowed the threatened action to be pursued.

After a period of inertia, Our Clients, as well as others, have been served with demand letters by a new assignee known as West 28 th Street Ltd . Accompanying the demand letters is a Notice of Assignment, by reason of which the Assignee has informed the alleged debtor of the Assignees right to enforce the debt.

Following two conferences we held last week and a number of phone call enquiries which we have received, we have been asked to comment upon the purport and effect of the Notice of Assignment, which the alleged debtors have received. Questions such as what does this mean (relating to the content) but more importantly is the ‘Notice’ valid?

Here I want to look briefly at the differences between the two documents.

There is no need for payment to make the assignment valid and therefore it is normally created by Deed.

The creation of a legal assignment is governed by Section 136 of the Law of Property Act 1925:

136 Legal assignments of things in action.

(1)Any absolute assignment by writing under the hand of the assignor (not purporting to be by way of charge only) of any debt or other legal thing in action, of which express notice in writing has been given to the debtor, trustee or other person from whom the assignor would have been entitled to claim such debt or thing in action, is effectual in law (subject to equities having priority over the right of the assignee) to pass and transfer from the date of such notice—

(a) the legal right to such debt or thing in action;

(b) all legal and other remedies for the same; and

Some of the basic requirements for a legal assignment are;

The assignment must not be subject to conditions.
The rights to be assigned must not relate to only part of a debt, or other legal chose in action.
The assignment must be in writing and signed by the assignor.
The other party or parties to the agreement must be given notice of the assignment.

Notice of assignment

To create a legal assignment, section 136 requires that express notice in writing of the assignment must be given to the other contracting party (the debtor).

Notice must be in writing

Section 136 of the LPA 1925 requires “express notice in writing” to be given to the other original contracting party (or parties).

Must the notice take any particular form?

The short answer is no. Other than the requirement that it is in writing, there is no prescribed form for the notice of assignment or its contents. However, common sense suggests that the notice must clearly identify the agreement concerned.

Can we challenge the Notice?

No. You can challenge the validity of the assignment assignment by ‘attacking the Deed, which must conform with Section 136. In this specific case, the Notice sent by West 28 th Street in itself is valid. Clearly, any claims made must be effected by a compliant Deed and it is that which will require detailed consideration before any right to claim under the alleged debt is considered.

Can I demand sight of the assignment agreement

On receiving a notice of assignment, you may seek to satisfy yourself that the assignment has in fact taken place. The Court of Appeal has confirmed that this is a valid concern, but that does not give an automatic right to require sight of the assignment agreement.

In Van Lynn Developments Limited v Pelias Construction Co [1969]1QB 607 Lord Denning said:

“After receiving the notice, the debtor will be entitled, of course, to require a sight of the assignment so as to be satisfied that it is valid…”

The Court of Appeal subsequently confirmed this stating the contracting party is entitled to satisfy itself that a valid absolute assignment has taken place, so that it can be confident the assignee can give it a good discharge of its obligations

The important document is the Deed of Assignment, which sets out the rights assigned by the Assignor. The Notice of Assignment is simply a communication that there has been an assignment. The deed is governed by Section 136 of the LP 1925. It should be possible to obtain a copy of the Deed prior to any action taken in respect of it.

For more information on the claims by West 28 th Street or if advice is needed on the drafting of a Deed, then please call us on 0151-328-1968 or visit www.elysium-law.com .

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Ask ashworths about: the hidden cost of owning a leasehold property.

When you make your offer for a leasehold flat most people will factor in regular costs that they have to pay to their freeholder or management company by way of service charges. Some will even remember that they need to pay an annual ground rent on top. However, there is another raft of expenses that are a hidden peril of owning a leasehold – and those are the administrative costs of selling the property.

Without exaggeration, these costs have been known to amount to over £1,000 so whilst there may not be a great deal that you can do about it, it is good to know what sort of costs you may be faced with.

The management pack

As solicitors, one of the first things that we do when instructed to sell a leasehold property is to request “the management pack” from either the freeholder or the managing agents. This pack contains all of the information that a purchaser will need about the management of the flat, including:

Details of any service charge arrears
Details of the current service charge budget
A note of any forthcoming major works
A copy of the service charge accounts themselves
A copy of the current buildings insurance

However good a leaseholder’s record keeping, it is unlikely that they will have all of the documentation in their own possession and the process of requesting the management pack from a third party has become almost automatic.

Professional firms of managing agents earn a significant part of their income from charging for management packs. Fees of around £500 are becoming increasingly common.

Trap 1 – If the property is managed by one company and owned by another company (who collects the ground rent) you may need to pay for two separate packs.

Trap 2 – Even if you own a share in freehold , the person who deals with day-to-day administration may charge a fee for collating the information and sending it through.

Licence to assign fees

Some leases, but by no means all, contain a provision that require an outgoing tenant to obtain their freeholder’s consent to them selling their lease. This “Licence to Assign” will generally be produced by the freeholder’s solicitor who, you guessed it, will charge for producing the licence which will eventually need to be signed by the seller, the freeholder and the buyer.

Licence to assign fees can be as much as £750, and of course will be subject to VAT (which few individual purchasers can reclaim).

Because it is the seller that is obliged to obtain their freeholder’s consent, it is usually the seller that ends up paying for the cost of obtaining it.

Deed of covenant fees

Whilst rarely needed at the same time as entering into a Licence to Assign, some leases require an incoming tenant or purchaser to enter into a direct contract with the freeholder or management company to pay service charges and otherwise to observe the provisions of the lease – “a Deed of Covenant”.

Trap 3 – Very often the wording of the requisite Deed of Covenant is set out at the back of the lease, but this will rarely stop a freeholder or managing agent charging to supply the necessary document.

Who pays for a Deed of Covenant will often be the subject of negotiation between a buyer and seller.

Notice fees

Nearly all leases contain a provision requiring a purchaser to serve a formal notice on the freeholder after they have completed their purchase. Usually the freeholder needs to be notified of both the fact that the lease has changed hands (or, more technically, that there has been “an assignment”) as well as the fact that there is a new mortgage on the property (a “notice of charge”).

Some freeholders are very happy to accept notice of assignment and notice of charge on a single document and to charge a single, nominal fee. Other freeholders see these notices as yet another revenue stream and £100 plus VAT for each notice is not uncommon.

Notice fees will nearly always fall for the purchaser to pay.

Share transfer fee

Another cost usually picked up by the purchaser are the fees paid to the managing agent or freeholder for transferring the share certificate in the management company from the name of the seller into the name of the buyer. This can be another £100 or more.

Freehold estates

Whilst this note has been prepared in the context of the transfer of a flat, on some larger, newer developments where an estate charge or rent charge is made a similar raft of charges might be charged by the managing agents or roads association or similar.

We are happy to discuss your requirements with you and to advise in general terms on all aspects of the transaction and the estimated legal cost. Please either contact us by telephone or email us at: [email protected]

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Stepping into what?

Ground rents, the ‘unknown’ costs of leasehold properties, cladding – part 2 of a two part update.

Difference Between Assignment and Transfer

The difference between assignment and transfer is that assign means it's legal to transfer property or a legal right from one person to another. 3 min read updated on February 01, 2023

The difference between assignment and transfer is that assign means it's legal to transfer property or a legal right from one person to another, while transfer means it's legal to arrange for something to be controlled by or officially belong to another person.

When used as verbs, assign means to set apart or designate something for a purpose while transfer means to pass or move from one person, place, or thing to someone or someplace else. When used as nouns, assign means the assignee and transfer is the act of removing or conveying something from one person, thing, or place to another. Transfer generally refers to titles whereas assignment is used with obligations and rights.

Definitions of Assignment and Transfer

Assignment: Assignment is used in real estate law and contracts law. It covers the transfer of rights held by the assignor to the assignee.
Transfer: To remove or convey from one person or place to someone or somewhere else.

Distinction Between Assignment and Transfer

When distinguishing between assignment and transfer, take licenses, for example. Licenses are contracts that don't allow legal action for infringement. They fall under state law. Therefore, state law will decide whether the license is an obligation or right that can be transferred or assigned legally.

One way to distinguish this example is that an individual contract under an agreement cannot be assigned, like entitlement to grant back royalties . In addition, the contract cannot be transferred. You need to break it down and figure out what the actual issue is — the parties' intent. An additional distinction is when the contract holder is an entity and the business owners want to transfer a portion or all of their stock. This can be seen as an implied transfer of the whole contract. However, it would not likely be an assignment of the rights covered under this agreement.

Difference Between Assign and License

The key difference between assign and license is that with a license, the person who grants permission, known as the licensor, keeps an interest in the product being licensed . In an assignment, the assignor will transfer his or her rights to the product or property being assigned.

Another difference is that assignments must be in writing and a license can be executed without being written. Consider, for example, intellectual property such as patents. Patents can be licensed verbally in some instances, but assignments for patents must be in writing and filed with the United States Patent and Trademark Office .

Assignments grant the assignee full ownership of a product or property. Therefore, an assignment will typically cost more to acquire than a license.

Frequently Asked Questions

Are there ever situations in which a license can be transferred but is not assignable?

Yes, in the case of allowing an assignment to one of your affiliates, the assignor would still be liable for the performance of the agreement under general assignment law. In this situation, you would not typically permit a transfer, because in a transfer, the person transferring would not maintain any obligations related to performance. Don't rely solely on this general understanding, but still expressly detail your agreement on what a licensee can legally do.

How will transfer and assignment rights affect someone's ability to sublicense?

In theory, if a licensee has the authority to assign license rights to someone else, you could argue that it also provides the right to sublicense it. The issue here is that with a sublicense, the person sublicensing it keeps a license right, therefore effectively creating two licensees. With an assignment, only one right is assigned, and the assignee is the one who has possession of the license. With well-drafted licenses, the right to sublicense is not typically implied, as the licensor is the one who reserves all rights that are not expressly granted.

What is the effect of poorly drafted licenses?

A poorly drafted license could result in giving someone implied rights to also sublicense. An example is a software license that allows a licensee to access the software without clarifying any restrictions or clearly defining the word “use.” This means that, depending on what this software is supposed to do, someone could think the term “use” means the licensee has permission to grant a sublicense as part of their usage rights.

If you need help understanding the difference between assignment and transfer, you can post your legal need on UpCounsel's marketplace. UpCounsel only accepts the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.

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Practical Law

Licence to assign

Practical law uk standard document 0-506-0569 (approx. 19 pages).

Assignments, Variations, Surrenders and Termination - Land and Buildings

Must a licence to occupy part be assigned (and/or notice of assignment given to the licensee) to the new licensor on sale of the property for the licensor to be liable to pay the rent to the new owner? The licence refers to the owner (to whom the rent must be paid) as the person entitled to the property.

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Employed as a housing case worker in 2015 at award winning legal aid practice Turpin & Miller Solicitors in Oxford, trained and later became head of the housing team. After a series of high-profile cases, she moved to north-west specialist housing firm Pearson & Johnson Solicitors advising and representing local authorities and registered social landlords. Whilst there she obtained Higher Rights and conducted advocacy on behalf of the firm in the range of housing law issues. In 2014 was invited to join London chambers 42 Bedford Row to work with a specialist housing law team. Now represents a range of clients from inner-London borough councils to private clients in the full spectrum of housing law. Elizabeth provides regular training to the London Borough Legal Association. Recent cases include Obtaining and enforcing possession orders for landlords Defending possession claims for tenants Dealing with Human Rights defences Dealing with Equality Act defences Dealing with unlawful occupiers and squatters Unlwaful eviction and harassment Disrepair, nuisance and statutory nuisance Homelessness reviews and appeals in County Court Injunctions to prevent anti-social behaviour and other orders available under he ASB Crime and Policing Act 2014 including committal applications Service charge claims Leasehold management issues

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Reversionary leases

Reversionary leasesReversionary leases (or future leases) are granted to take effect in possession at a future date. This Practice Note looks at:•when a reversionary lease is used (including to avoid surrender and regrant)•statutory rules relating to the grant of reversionary leases (including in

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Difference Between Licensing and Assignment Agreements

Introduction

An agreement can be defined as a meeting of the mind with the understanding and recognition of shared legal rights and responsibilities as to the precise acts or obligations which the parties agree to exchange; a mutual consent to do or refrain from doing anything; a deal. The arrangement is not necessarily compatible with the contract, since it can neglect the basic aspect of the contract, such as concern. Under Section 2(e) of the Indian Contract Act, 1872, the word “Agreement” is specified as every promise and every set of promises to be considered for each other is an agreement.” And an agreement enforceable by statute is a contract. The term “lease” is defined in accordance with Section 52 of the Indian Easement Act, 1882 as “Where a person grants to another person, or to a certain number of other persons, the right to do or to continue to do, in or on the immovable property of the grantor, anything which in the absence of that right, would be unlawful and that right does not amount to servitude or interest in the property, right i. Thus a Licensing Arrangement is a formal document between two parties, the Licensor and the Licensee, where one party (the Licensor) grants permission or authorization to use its property/intellectual property/brand name or trademark/patent technology to another party (the Licensee) under a specified set of terms and conditions.

Licensing Agreements

A licence arrangement is a written agreement between two parties in which the owner of the land allows another party to use the property in compliance with a particular set of conditions. Licensing arrangements or licensing agreements normally include the licensor and the licensee. Licensing agreements set out the conditions by which one party can use land owned by another party. Although the assets in question which include a variety of products, including land interests and personal belongings, licence arrangements are most commonly used for intellectual property purposes, such as patents and trademarks, as well as copyrights for printed materials and graphic arts. For eg, Nestle and Starbucks entered into a $7.15 billion coffee licencing agreement in May 2018. Nestle (the licensee) agreed to pay $7.15 billion in cash to Starbucks (the licensor) for exclusive rights to market Starbucks products (single-serve coffee, teas, bagged beans, etc.) around the world through Nestle’s worldwide distribution network. In addition, Starbucks can earn revenue from bottled coffees and teas offered by Nestle. The licence arrangement provided Starbucks with the opportunity to push brand awareness beyond its North American operations via Nestle’s distribution networks. For Nestle, the company acquired access to Starbucks products and a good brand reputation.

Types of Licensing Agreements

1. Exclusive Licensing Agreement – This form of arrangement establishes a special partnership between the licensor and the licensor. In such arrangements, no one except the designated licensee is entitled to exploit or use the licensed property within the duration of the agreement. The special characteristic of this form of arrangement is that even the licensor is exempt from the use or misuse of the approved property within the duration of the agreement. Copyright, patents and patent licences are the best examples of an exclusive licensing arrangement.

2. Non- Exclusive Licensing Agreement – In this form of arrangement, the licensor may issue a licence for the licensed property to any number of licensees and may also use the licensed property within the duration of the agreement.

3. Co- Exclusive Licensing Agreement – This form of arrangement requires more than one licensee to use and manage the licensed property, except this time the number of licensees is limited and their number is set at the time of entering into the agreement.

4. Sole Licensing Agreement – This form of the arrangement is somewhat similar to an exclusive licensing agreement, but the only exception is that the licensor retains the right to use the licensed property for the duration of the agreement.

Assignment Agreements

Contract assignment means that the contract and the property rights or responsibilities within the contract can be delegated to another party. As a general concept, a contract assignment may be included in a business contract. This form of provision is typical in negotiations with manufacturers or suppliers and in deals on intellectual property. Contract assignment is also used in contracts that give either side the option to pass its share of the contract to someone else in the future. Many assignment clauses enable all sides to commit to the assignment. An assignment can be made to anyone but is normally made to a subsidiary or a successor. A division is a company that is purchased by another business, while a descendant is a business that accompanies a transaction, takeover or merger.

Specifications in IP Assignment Agreement

1. Identification of the Parties -identifies the contract as an arrangement for the assignment of intellectual property and identifies the Assignor and the Assignor. The party transferring (‘assigning’) ownership interest shall be referred to as the Assignor, while the party obtaining it shall be referred to as the Delegated.

2. Obligations of the Parties -It is necessary to explicitly specify the obligations of the Parties in order to prevent any subsequent dispute as to the nature of those obligations; the precise meaning and extent of the obligations of the Parties depends on the form of intellectual property transferred; however, the principal duty of the Assignor is to transfer the rights of intellectual property.

3. Liability and warranty provisions -refers to the right of the assignor and the authority to enter into such an agreement; for example, to promise that he is the sole owner of all rights, title and equity in the IP and that the IP is legitimate and valid; that the transferred IP does not infringe the rights of third parties.

4. Compensation -A summary of the potential duties of each party if intellectual property is found to infringe the interests of a third party.

5. Applicable law and jurisdiction -The national law may prevail in the case of a conflict; it is also necessary to specify the appropriate court or the arbitration/mediation process to which the issue can be referred.

Licensing and Assignment Agreements

1. Interest Vested : One can licence the IP to another person or business to use as the owner of the IP. One and the other party negotiate on the terms of this usage. This is known as a licensing arrangement, and in this case, one is the licensor and the other party is the licensor. The terms of usage outlined in this Document should be agreed between oneself and the other party in order to protect the best interests. These terms govern the arrangement which includes: the limitation of the licensee’s usage to a single geographical location; and the payment of rights in the form of royalty.

In relation to a licence, an assignment agreement is a permanent transition of the IP. This transition is irrevocable and usually takes place as a sale or transfer from the owner (assignor) to the purchaser (assignee). If one is trying to pass control of the IP, he can ensure that this transfer is made in writing by means of an act or other formal agreement. These documents can pass current or potential IP rights in exchange for a lump-sum payment.

2. Method of Assignment : There is no requirement to do so in writing in licencing IP. Involved licences can often be invoked by the application of the rule. Example commissioned to produce patent content, and no formal arrangement is in effect. In this case, it is generally presumed that a tacit licence has been issued to the person who commissioned the material to be produced. There is a tacit licence on the payment that the commissioned party has an implicit licence for the copyrighted piece. It would then be implied that they will use it for the purposes of an unwritten arrangement.

The designation to an IP shall be permanent and irrevocable in the assignment agreement. Therefore in order to do this correctly, the task must be in writing.

3 . Notification: There is no notification mechanism for one IP licence. It is actually a private arrangement between the licensor and the licensee.

When the IP owner transfers an IP to the assignee, the assignee would have to file an application for transfer of ownership. If the Registrar collects the form with the assignment information, the assignee is legally the owner of the IP. Once this phase has been finished. The Registrar is then obligated to inform any other person involved.

4. Cost: Although the assignment gives the assignee sole ownership of the piece of land, the purchase of the assignment would normally cost more than the acquisition of the licence.

5. Enforceability – Another significant difference between the two of them is in the requirement to make them enforceable. It is a signatory that the assignment agreement is required to be recorded and filed in The United States Patent and trademark office assignment recordation branch. It is observed that the license is less stringent and thus it can be granted orally. The best-suited method is to have a negotiated and signed licensed, unlike assignment a record of the agreement is not mandatory.

1. Ashley Duggar, study: Contract Agreement, study.com, available at https://study.com/academy/lesson/assignment-of-rights-definition-and-involved-parties.html

2. Richard Sim, study: What is the assignment of Contracts, Nolo, available at https://www.nolo.com/legal-encyclopedia/assignment-of-contract-basics-32643.html

3. Gene Pierson, study: the difference between assignment and a license, Pierson Intellectual Property, available at http://piersonpatentlaw.com/what-is-the-difference-between-assignment-and-a-license/

4. Study: Assignment Agreement, Thrive IP, (31 st October 2017), available at https://thrive-ip.com/assignment-agreement-vs-license-agreement-ip-tool-box-series/

5. Gordon Haris, study: Basics of Patent Law, Lexology, (19 th April 2017), available at https://www.lexology.com/library/detail.aspx?g=c4f8c628-3d98-4bb9-966c-c9cf96679957

6. David Szostek, study: Difference between Assignments and licenses, Edward Allen Attorney of law, (8 th April , 2015), available at https://www.edwardallenlaw.com/difference-between-copyright-assignments-and-licenses/

7. Andrew Bloomenthal, study: Licensing Agreements, Investopedia,(3 rd September 2019), available at https://www.investopedia.com/terms/l/licensing-agreement.asp

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WHAT IS THE DIFFERENCE BETWEEN ASSIGNMENT AND A LICENSE?

The main difference between the two is that in a license the person granting permission (Licensor) retains an interest in the property being licensed, whereas in an assignment the assignor transfers his rights in the property being assigned.

In intellectual property, a license may grant a licensee to use a patent, trademark, software, etc. without being sued. Licenses come in many different flavors and pretty much any type of provision can be worked into a license such as the length of the license, the territory where a license may apply, the nature of the license (exclusive vs. non-exclusive), etc. If an inventor/start-up company obtains a patent, they may license their patent to another person or company in exchange for royalties. As previously discussed, the rights given in different licensees may vary and overlap. For example, if company A obtained a patent, they can have a non-exclusive license to company B for 10 years in North America, and have a non-exclusive license to company C for 5 years without territorial exclusions. As such, different terms for licensees may be contracted with different companies. If company A granted an exclusive license to company B for the full length of the patent along with derivative works, then the license will essentially work as an assignment.

A major difference between licenses and assignments is that assignments are required to be in writing whereas licenses may be applied without writing. Specifically, patents may be licenses orally (in some circumstances) whereas assignments for patents must be in writing and filed with the USPTO. One such example of an implied license is if a user purchases a product at a retail store. It is implied that they are able to use the product or display it in pictures, etc. As such there is an implied license that grants the user limited rights without any writing.

Because assignments grant an assignee full ownership of a piece of property, typically to acquire an assignment will cost more than to acquire a license.

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Difference Between an IP Licence vs an Assignment in England

By Rachel King

Updated on 7 November 2022 Reading time: 5 minutes

This article meets our strict editorial principles. Our lawyers, experienced writers and legally trained editorial team put every effort into ensuring the information published on our website is accurate. We encourage you to seek independent legal advice. Learn more .

Intellectual Property Rights

Licensing Your IP
Assigning Your IP

Which Option is Best for Your Business?

Key takeaways, frequently asked questions.

Your business has valuable intangible assets that you can benefit from financially. Most companies have intellectual property (IP) assets such as copyrighted materials, trade marks, design rights, and patents. You may wish to licence or sell these assets to other businesses or people. This article will explain the difference between an IP licence and an assignment in England.

Your IP assets may include your:

copyrighted materials, for example, product descriptions and graphics;
design rights;
trade marks, for example, your business name and any branding elements associated with your company; or
patents on any inventions.

As with any other business asset, you can sell your intellectual property or allow someone else to use it. You can do this with a licence or an assignment.

Licensing Your IP

Intellectual property licensing is where you give someone else the right to use your IP asset, but you want to maintain ownership of the asset and continue to use it yourself. The licence agreement will provide the licensee with specific rights to use your IP. You can grant:

a non-exclusive licence where you also want to continue to use the IP; or
an exclusive licence to give exclusive rights to use the IP for the duration of the licence agreement.

You might want to licence your IP rights to another party for several reasons, for example:

you are developing a product you hold patents on or need consultancy advice; or
you have obtained a patent for a product but would prefer someone else to make it.

Licensing your IP rights to others can expand your business into new areas or markets.

Licences for Patents

A ‘licence of right’ is a specific licence related only to patent rights. It means the patent owner is willing to allow anyone to licence that particular patent upon request. The patent holder would still be able to negotiate the terms of that licence, such as the cost and how long the licence will be for and any limitations on the use, but cannot outright refuse to licence the patent.

There is a benefit to the patent holder as the IPO halves the annual renewal fees for patents with a licence of right. Also, it is clear to others that you are willing to licence your patent for use by others.

LegalVision’s Trade Mark Essentials Guide provides valuable information for any business looking to register or enforce a trade mark.

Assigning Your IP

If you want to permanently sell or transfer your IP interests to another party, you do this through an assignment. You assign your IP rights in that asset to the other person or business. This means they will now own it, and you will have no right to use that IP.

You can assign registered and unregistered IP, including copyrights, patents, design rights and trade marks. You should inform the Intellectual Property Office (UK IPO) that you have transferred the rights to a new owner for registered IP, such as patents, design rights, and trade marks.

Whether licensing or assigning your IP rights is best for you and your business depends on whether you want to retain ownership of the IP asset in question and why you want to allow someone else to use it.

For example, if you are considering licensing or assignment to provide business income, you can potentially use a licence to provide ongoing regular income. If you decide on an outright transfer of ownership, it will provide one lump sum. This may be appropriate if you are no longer interested in using the IP asset.

If you have valuable business IP assets such as trade marks, patents, design rights or copyrighted materials, you can raise income for your business by licensing or assigning your IP to another party. A licence allows you to grant permission for someone else to use your IP whilst retaining the right to use it yourself. If you no longer want to use your IP at all, you can transfer ownership to someone else through an assignment of your IP.

If you need help with assigning or licensing your IP rights, our experienced intellectual property lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page .

You use an IP licence to grant permission to someone else to use your IP, but you still retain ownership of it and the right to use that IP yourself.

An assignment of IP transfers ownership of a particular IP asset to another party. The new owner of the IP will be able to use it and benefit from it as if they were the original owner of that particular IP asset. You will no longer have the right to use the IP asset unless the new owner permits you to use it.

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What is the Difference Between an IP Licence and an Assignment?

By Christopher Parker Lawyer

Updated on November 17, 2020 Reading time: 5 minutes

IP Licencing

Ip assignment, why assign or licence your ip, is licensing or assignment most suitable for your business, key takeaways.

Intellectual property (IP) is an intangible, yet extremely valuable asset to your business. It can include:

inventions; or
creative works.

To know the worth of your IP will provide you with an edge over the competition, as other businesses can overlook IP protection. Sometimes, you may not be best equipped to effectively utilise your IP. There is more than one way you can leverage the commercial value of your IP. This article will explore two ways to commercialise your IP – assigning and licensing .

As the owner of IP, you can licence your IP out to another person or company to use. Both yourself and the other party agree on the terms of this use. This is known as a licensing agreement, and in this example, you are the licensor, and the other party is the licensee.

The terms of use outlined in this agreement should be negotiated between you and the other party to secure your best interests. These terms regulate the agreement and can include:

restricting the licensee’s use to a particular geographical location; and
the payment of rights in the form of royalties.

Types of licenses include:

exclusive , where the owner of the IP grants only one licence and is not able to use the IP themselves;
non-exclusive , where the owner of the IP can grant more than one license and is able to use the IP themselves.
sole , where the owner of the IP can grant only one licence and is able to use the IP themselves.

Unlike a licence, an IP assignment is a permanent transfer of IP. This transfer is irrevocable and generally occurs as a sale or transfer from an owner ( assignor ) to the purchaser ( assignee ).

If you are looking to transfer IP ownership, you should ensure that this transfer is in writing by way of a deed or other written agreement. These documents can transfer present or future IP rights in exchange for a lump-sum payment.

The main reason why you might want to assign or licence your IP is to ensure that it is being used effectively. Businesses often overlook the potential value in their IP, and consequently, they lose out on the benefits. You should consider licensing or assigning your IP if you have no current or future plans to use it. You should also consider the potential benefits of licensing your IP. Below are some reasons why assigning or licensing your IP can be beneficial to your business.

Development

Assigning or licensing your IP opens up the opportunity for investors to invest in your IP without worrying about the development phase, which is often expensive and time-consuming.

Manufacturing and Distribution

By licensing your IP rights, you can have your IP exclusively manufactured and distributed by a licensee. In this type of relationship, you enjoy the royalties, while the licensee manufactures and exploits your IP.

Commercialisation

As a licensor, you may want to use an exclusive licence to commercialise your IP. Similar to manufacturing and distribution, you will gain royalties from the licensee’s commercial use and exploitation.

IP Holding Company Structure

Another way you can use your IP is to create a holding company and assign ownership of your IP to a holding company. This way, your holding company licenses the IP to subsidiary companies. This is a great way to ensure that you are getting the most out of your IP and streamline ownership.

If you are an employer, you should ensure your employment contract stipulates that your employees assign all IP they create during their employment to your business. If you have not mentioned this in your contract, as an employer you can also ensure employment is terminated should IP be misused.

Universities

Similar to employment, universities often require their Honours or PhD students to assign current and future IP to protect any work created. However, the difference is that, typically, universities enter into agreements that allow for co-ownership of patent-worthy inventions and to share royalties.

You must consider the payment structure that your business uses before you assign or license your IP. Licensing your IP will mean that you have a flow of royalties over an agreed period. If you instead choose to assign your IP, you will receive a lump sum. The most appropriate choice for your business depends on which option offers the most commercial value.

The most important thing to consider when choosing to assign or license your IP is the commercial value of each option. There are two important ways of leveraging the commercial value of your IP:

assigning; and

Assigning is an irrevocable sale or transfer of your IP to another company or individual.

Licensing allows you to transfer ownership of your IP under certain agreed-upon conditions and for a specific period of time. The potential reasons why you should consider assigning or licensing your IP include:

development;
manufacturing and distribution; and
commercialisation

An IP holding company structure is a great way to set up ownership in your own entity and license it out to subsidiary companies. Employers and universities may have terms in their contracts that assign IP created by their employees or students to them. If you have any questions about assigning or licensing your IP, contact LegalVision’s IP lawyers on 1300 544 755 or fill out the form on this page.

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COMMENTS

Assignment of Lease: Definition & How They Work (2023)
An assignment ensures the complete transfer of the rights to the property from one tenant to another. The assignor is no longer responsible for rent or utilities and other costs that they might have had under the lease. Here, the assignee becomes the tenant and takes over all responsibilities such as rent.
What is a Licence to Assign? A Summary
A licence to assign is a landlord's permission for a tenant (the assignor) in occupation under a lease to assign the lease to a new incoming tenant (the Assignee). It should be noted that this permission does not necessarily need to be in a formal deed. Therefore, landlords and agents should be mindful of falling into the trap of granting ...
Don't Confuse Change of Control and Assignment Terms
Change of control and assignment terms actually address opposite ownership changes. If an assignment clause addresses change of control, it says what happens if a party goes through an M&A deal and no longer exists (or becomes a shell company). A change of control clause, on the other hand, matters when the party subject to M&A does still exist.
Assignments: why you need to serve a notice of assignment
The case concerned the assignment of a trade mark licence to GNIC. The other party to the licence agreement was H&B. H&B had not received notice of the assignment. GNIC tried to terminate the licence agreement for breach by serving a notice of termination. H&B disputed the termination.
Commercial lease assignments: A guide for businesses
Licence to assign: A solicitor can assist in drafting this document, ensuring that it covers all necessary conditions and terms for the assignment, meets legal requirements, and protects the interests of both parties. ... Assignment vs. subletting: Assignment involves permanently transferring your lease obligations to a new tenant. On the other ...
Shared ownership leases: a quick-fire guide to assignments
In this quick-fire guide, we outline the steps social landlords should take when assigning a shared ownership lease to ensure the process runs smoothly: Use a license. Unless the leaseholder has staircased to 100%, the landlord's consent will be required to assign the lease. To provide evidence of this consent, enter into a licence to assign ...
Licence to Assign
A licence to assign is the formal document detailing the landlord's permission for a leaseholder selling their property to assign the lease to the new incoming leaseholder purchasing their property. This then makes the incoming leaseholder responsible for the leaseholder duties within the lease. When assessing whether to approve a licence to ...
Navigating the assignment of a commercial lease
Many commercial assignment agreements contain provisions for the: Payment of fees to the landlord for having another business substitute for yours. Assignor's and assignee's names, addresses, and business names. Landlord's name, address, and business name. Amount of the new tenant's rent and the dates for payment. Date of the agreement.
Free Licence To Assign
This Licence to Assign template covers: providing a commercial tenant with consent to assign. an optional requirement that the tenant will guarantee the rent and sums due under the lease. a time limit for completion of the lease assignment. the landlord's registration fee.
Assignment Of Lease: A Brief Look
Licence to Assign is the document that enables the current tenant (Assignor) to transfer the lease to the Assignee (incoming tenant) with the landlord's permission (consent). All three parties will sign this document. A landlord usually requires a rent deposit as a precondition to providing its consent to the assignment of a lease.
Licence to assign: some practical tips
Licence to assign: some practical tips. Almost all commercial leases prevent the tenant from assigning the lease without obtaining consent from the landlord. Disputes often arise and landlords, in particular, have to act quickly. The consequences of making a late decision are often no better than making the wrong decision: in either case, the ...
Deed of Assignment and the Notice of Assignment -What is the Difference
Summary. The important document is the Deed of Assignment, which sets out the rights assigned by the Assignor. The Notice of Assignment is simply a communication that there has been an assignment. The deed is governed by Section 136 of the LP 1925. It should be possible to obtain a copy of the Deed prior to any action taken in respect of it.
Assignment and novation
an assignment of which notice has not been given to the debtor; an agreement to assign. If the assignment is equitable rather than legal, the assignor cannot enforce the assigned property in its own name and to do so must join the assignee in any action. This is designed to protect the debtor from later proceedings brought by the assignor or ...
Hidden Cost Of Owning A Leasehold Property
Licence to assign fees can be as much as £750, and of course will be subject to VAT (which few individual purchasers can reclaim). ... Some freeholders are very happy to accept notice of assignment and notice of charge on a single document and to charge a single, nominal fee. Other freeholders see these notices as yet another revenue stream ...
Difference Between Assignment and Transfer
Difference Between Assign and License. The key difference between assign and license is that with a license, the person who grants permission, known as the licensor, keeps an interest in the product being licensed. In an assignment, the assignor will transfer his or her rights to the product or property being assigned.
Licence to assign
Licence to assign. Licence from the landlord giving consent to the tenant to assign a lease which is a new lease under the Landlord and Tenant (Covenants) Act 1995. The tenant is required to give an authorised guarantee agreement (AGA) in a separate document and any guarantor for the outgoing tenant is joined as a party to the licence.
Must a licence to occupy part be assigned (and/or notice of assignment
It explains that a licence is a personal permission from the licensor to the licensee, not an interest in land like a tenancy. Therefore, the licence does not bind a new owner who was not party to it. On sale of the property, the new owner would need to grant their own licence for the occupation to continue.
Assigning a business lease
A licence to alter and also a licence to change the use of the premises may also be required. A licence to change the use of the premises may be subject to planning permission. In Scotland, where the assignment is accepted by the landlord, the outgoing tenant will no longer have any responsibilities under the lease.
Licence to assign checklist
The Licence to Assign needs to be signed only by the landlord giving their consent for the lease assignment with this Licence. Signing as a deed. If the lease requires that a Licence to Assign is signed as a deed: Print a copy of the Licence to Assign for each of the parties (ie the landlord, the tenant and the assignee).
Difference Between Licensing and Assignment Agreements
4. Cost: Although the assignment gives the assignee sole ownership of the piece of land, the purchase of the assignment would normally cost more than the acquisition of the licence. 5. Enforceability - Another significant difference between the two of them is in the requirement to make them enforceable.
What Is the Difference Between Assignment and A License?
The main difference between the two is that in a license the person granting permission (Licensor) retains an interest in the property being licensed, whereas in an assignment the assignor transfers his rights in the property being assigned. In intellectual property, a license may grant a licensee to use a patent, trademark, software, etc. without being
Difference Between IP Licence vs Assignment
A licence allows you to grant permission for someone else to use your IP whilst retaining the right to use it yourself. If you no longer want to use your IP at all, you can transfer ownership to someone else through an assignment of your IP. If you need help with assigning or licensing your IP rights, our experienced intellectual property ...
IP Licence vs Assignment: What's the Difference?
Unlike a licence, an IP assignment is a permanent transfer of IP. This transfer is irrevocable and generally occurs as a sale or transfer from an owner (assignor) to the purchaser (assignee). If you are looking to transfer IP ownership, you should ensure that this transfer is in writing by way of a deed or other written agreement.

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