Leasehold Property law. Personally delivered.
Leasehold Property law. Personally delivered.
Changing the terms of a lease, or correcting a document that never said what the parties agreed. We act for leaseholders seeking variations and for landlords and management companies asked to grant them — including block-wide programmes and applications to the Tribunal.
Acting for leaseholders and landlords · Fixed fees from £1,250 + VAT · Regulated by the SRA · London and nationwide
A lease is a contract, and like any contract it can be altered if the parties agree. A deed of variation is the document that does it: the lease continues, and only the terms identified in the deed change.
They are needed more often than anyone expects. Ground rents that make a flat unmortgageable, service charge percentages that do not add up, buildings where nobody is obliged to repair the roof, rights that were never granted, alterations that quietly moved the boundaries of a flat — all of them are dealt with by variation. Where the problem is instead that a document never recorded what the parties actually agreed, the answer is a deed of rectification.
Four documents are routinely confused with one another, and choosing the wrong one wastes weeks or produces a result nobody intended.
A licence gives permission. A variation changes the bargain permanently and binds successors — so it appears on the title, a buyer’s solicitor will read it, and it affects the value of both the lease and the freehold. Landlords sometimes offer a licence where a variation is needed, and leaseholders sometimes ask for a variation where a licence would do. Establishing which is required is the first question, not a detail.
This is the single most expensive mistake made in this area, and it is made by drafting a document that says “deed of variation” at the top when the law treats it as something else entirely.
A variation that extends the term of the lease, or that increases the extent of the demised premises, operates in law as an implied surrender of the old lease and the grant of a new one. It does not matter what the parties call it. The old lease ends; a new lease comes into existence on the date of the deed; the old leasehold title is closed and a new one opens.
Four consequences follow. The lease date changes, so priority, registration and the position of any guarantor follow the new lease. Ground rent may be caught — a new long residential lease granted since June 2022 must be at a peppercorn for the extended term, and the restriction applies whether or not a premium is charged, so a landlord expecting to keep an income stream can lose it. Stamp duty land tax is calculated differently on a surrender and regrant. And your mortgage does not move by itself: the lender must consent and a deed of substituted security is required, without which HM Land Registry will not register the new lease.
How to tell which you have. Does it touch the term? Any lengthening is a surrender and regrant. Does it change what is demised — a loft, a store, a strip of garden? Also a surrender and regrant. If neither, it is a true variation: rent, service charge, repairing obligations, user covenants and rights over land the landlord keeps can all be varied without disturbing the lease itself.
None of this is a reason to avoid a surrender and regrant. It is frequently the right document. The mistake is arriving at one by accident, with nobody having considered the rent, the tax or the lender.
An escalating or doubling ground rent, or a defect a lender will not accept. Most lenders now decline ground rents that double at intervals, and a variation capping or extinguishing the rent is often the only way a sale completes. Where the lease is short, a statutory lease extension may be the better answer — it removes the ground rent as of right and does not depend on the landlord agreeing to anything.
Service charge percentages that do not total 100%, no obligation on anyone to repair the structure, missing insurance provisions, no reserve fund, no mutual enforcement covenant, or no right of entry to inspect.
Parking spaces, bin and bike stores, access rights that were never granted, plans that do not match the building, and alterations already carried out that have effectively moved the extent of the flat.
Relaxing an absolute prohibition on pets or subletting, or — increasingly, at the landlord’s or the other leaseholders’ request — tightening a lease to control short-term letting.
A good proportion of our variation work is regularising something a predecessor did: alterations consented to informally and never documented, a parking space used for thirty years but never granted, or a flat whose boundaries no longer match the plan attached to the lease. The current leaseholder inherits the problem and usually discovers it on a sale.
Where a document does not say what the parties actually agreed, the answer is not to vary it but to correct it. A deed of rectification puts the document back to what it was always meant to be.
It is used for drafting errors, incorrect property descriptions, plans that do not match the ground, boundaries recorded wrongly, and mistakes in a lease, a transfer or a deed of covenant — including simple clerical errors that have sat unnoticed for years and surface when somebody tries to sell.
But rectification is not a soft option. It requires evidence of the parties’ common intention at the time, and the agreement of everybody who was party to the original document. Where the other side will not co-operate, it means an application to the court. It is not a route to improving a bargain that was simply a poor one, and the distinction between “the document is wrong” and “the document is unwelcome” is the first thing we establish.
Where a corrected or varied document affects the register, we deal with the application to HM Land Registry so that the change is properly recorded against both the leasehold and, where relevant, the freehold title.
A landlord is under no obligation to agree a variation. Where agreement cannot be reached, Part IV of the Landlord and Tenant Act 1987 provides a limited but valuable route to the First-tier Tribunal.
Section 35 allows any party to a long lease of a flat to apply to vary it where the lease fails to make satisfactory provision on one of a closed list of matters — repair or maintenance of the flat, the building or its installations; insurance; the provision of services; the recovery of expenditure by one party from another; or the computation of the service charge.
Section 36 lets a respondent ask for the other leases in the building to be varied too, so that the block is not left with inconsistent documents. Section 37 allows two or more leases to be varied together by majority: for fewer than nine leases, all or all but one of the parties must consent; for more than eight, at least 75% must consent and no more than 10% may object. Section 38 gives the Tribunal power to order the variation, and to award compensation for loss or disadvantage caused by it.
The grounds are a closed list. Section 35 cannot be used to reduce a ground rent, extend a term or change a user covenant, however unreasonable the provision may be.
And if the percentages already total 100%, the service charge ground is not made out — however inequitably the total is distributed. A studio paying the same percentage as a three-bedroom flat above it is unfair by any ordinary measure, but the arithmetic is satisfied and the Tribunal has no jurisdiction. The answer then is agreement under section 37, or nothing.
A landlord may also not be free to agree. Where a lease obliges the landlord to enforce the covenants in the other leases, permitting one leaseholder to do something the leases prohibit may put it in breach to everybody else in the building — a point established in litigation that reached the Supreme Court. A refusal may therefore be principled rather than obstructive, and the route through is a variation of all the leases rather than of yours alone.
Counting the majority under section 37 catches people out. The parties concerned are every leaseholder plus the landlord, so in a block of one hundred flats there are one hundred and one parties and seventy-six must consent. The landlord has a vote like anybody else — which in a leaseholder-owned building is worth remembering.
A variation binds successors, so getting the parties right matters as much as getting the wording right.
Where the freeholder has granted a head lease, the head lessee is your immediate landlord and both interests may need to be varied.
In a tripartite lease the company has its own covenants and must join in.
A variation completed without a lender’s consent can be unenforceable against that lender and is a breach of the mortgage conditions. Lender consent commonly takes two to four weeks and is the item most likely to hold up completion, so it is started at the outset rather than at the end.
The variation should be noted against the leasehold title, and where it affects the landlord’s obligations against the freehold title too. An unregistered variation may not bind a successor, and an unnoted deed is the reason a buyer’s solicitor raises an enquiry ten years later that nobody can answer.
An agreed variation between willing parties takes six to twelve weeks. A contested application to the Tribunal takes considerably longer and should be a last resort rather than an opening position.
We read the lease, the title and — where the defect affects the building — the other leases in it. Many apparent defects turn out to be questions of construction that can be resolved without varying anything, which is cheaper and quicker. This is also where we establish whether a variation, a rectification, a licence or a surrender and regrant is required.
A proposal setting out precisely what is sought and why, with the draft deed where the point is straightforward. Landlords respond better to a specific request than to an open invitation to negotiate. Expect to give an undertaking for the other side’s reasonable costs, and expect the question of a premium where the variation transfers value.
Intermediate landlords, management companies and every mortgagee. Lender consent is started now rather than when the deed is otherwise ready.
The deed identifies the lease precisely, states which provisions are varied and from what date, confirms the lease otherwise continues unchanged, and deals with costs. Where the service charge is affected, the arithmetic across the whole building is checked rather than assumed.
The deed is completed, any premium and costs paid, and the variation noted at HM Land Registry against every affected title. Do not leave this undone.
Deeds of variation are priced on the type of variation, its complexity and the number of flats requiring one. We work to fixed fees agreed before we start.
Why batch instructions cost less. Where a defect runs through every lease in a building, the drafting is done once and applied across the block. The saving is real and it is passed on — tell us how many flats are involved and we will price it as a single exercise rather than as a variation per flat.
Where the variation cures a defect that prejudices both sides — a service charge that under-recovers, or an unrepaired roof — there is a fair argument that costs should be shared. It is worth making early, before an undertaking has been given for the whole.
Administration charges. A charge made by a landlord for considering or granting a variation is an administration charge in a long residential lease, and its reasonableness can be challenged at the First-tier Tribunal.
Stamp duty land tax may arise on a premium, and is calculated differently on a surrender and regrant. Nothing on this page is tax advice.
We act for freeholders, resident management companies and right to manage companies asked to grant variations as often as for leaseholders seeking them.
Dealing with leases one at a time is the expensive way. Where a defect affects a whole block, varying leases individually as flats are sold produces an estate governed by several inconsistent documents and a problem that grows. An audit of the leases, followed by agreed variations where possible and a section 37 application where not, is more work at the outset and very much less thereafter.
And the block-wide renewal is the moment to fix everything. Where the leaseholders own the freehold and are granting themselves new long leases, the company controls the drafting and can adopt a single precedent for every flat. The marginal cost of doing it well at that point is very small; the cost of not doing it recurs at every sale for centuries.
We check for conflicts before we take instructions, and we will not allow one to arise. Where we already act for the other side of a matter we will say so at the outset.
Variation, rectification, licence or surrender and regrant. Getting this wrong is the commonest and most expensive error in this area, and it is settled in the first conversation rather than the third month.
Anything touching the term or the extent of the demise is considered for its rent, tax, registration and enfranchisement consequences before it is drafted, not afterwards.
Sections 35 to 38, including the evidence a Tribunal expects and the counter-applications a respondent may make — and a candid view on whether the grounds are actually there.
Auditing the leases in a building, identifying the defects that matter, and putting a single consistent scheme in place across every flat.
Consents obtained and the deed properly noted at HM Land Registry, so the variation binds successors and does not become an enquiry on a future sale.
A deed that changes identified terms of an existing lease. The lease continues and only the provisions set out in the deed change. It binds successors, appears on the title and will be read by a buyer’s solicitor, so it is a permanent change to the bargain rather than a one-off permission.
A variation changes what the parties agreed. A rectification corrects a document that never recorded what they agreed in the first place. Rectification requires evidence of the original common intention, and is not a route to improving a bargain that was simply a poor one.
Yes. There is no obligation on a landlord to vary a lease, and no statutory timetable. Where the lease fails to make satisfactory provision on one of the matters listed in section 35 of the Landlord and Tenant Act 1987, you can apply to the First-tier Tribunal — but the grounds are a closed list.
From £1,250 plus VAT for an individual variation and from £950 plus VAT per lease for batch instructions across a building. You will usually also be responsible for the other side’s reasonable costs, and a premium may be payable where the variation transfers value.
It can, but it will not be a variation in law. Any agreement extending the term operates as a surrender of the old lease and the grant of a new one, whatever the document is called — with consequences for ground rent, stamp duty, registration and your mortgage. It should be drafted as what it actually is.
If the landlord agrees, yes. There is no way to compel it: section 35 cannot be used to reduce a ground rent. Where the lease is short, a statutory lease extension may be the better answer, because it removes the ground rent as of right and does not depend on the landlord’s goodwill.
Yes, and it is one of the clearest grounds. Where the aggregate of the percentages across the building exceeds or falls short of the landlord’s expenditure, the lease fails to make satisfactory provision and the Tribunal can vary it under section 35.
Not through section 35. Where the arithmetic works, the ground is not made out however inequitable the distribution. The route is agreement under section 37, which requires the consent of at least 75% of the parties where more than eight leases are involved, with no more than 10% opposing.
Yes, and it is the item most likely to delay completion. A variation completed without the lender’s consent can be unenforceable against it and is a breach of the mortgage conditions. We start the consent at the outset rather than when the deed is otherwise ready.
It should be noted against the leasehold title, and where it affects the landlord’s obligations against the freehold title too. An unregistered variation may not bind a successor, and an unnoted deed is a common source of enquiries years later on a sale.
Yes, and it is markedly cheaper. Where the defect runs through every lease, the drafting is done once and applied across the block — our batch rate starts at £950 plus VAT per lease. Where agreement is not unanimous, section 37 allows variation by majority.
Six to twelve weeks where the parties are agreed. Lender consent is usually the constraint. A contested application to the First-tier Tribunal takes considerably longer and should be a last resort.
Frequently, yes — by deed of rectification where the plan never reflected what was agreed, or by variation where the parties are simply agreeing a different extent. Which applies affects the evidence needed and whether the other side’s agreement is strictly required.
Not always. Where the leases oblige you to enforce the covenants in the other leases, agreeing a variation that relaxes a prohibition for one flat may put you in breach to everybody else in the building. It is worth checking the enforcement covenant before responding.
Yes, and a substantial part of this practice is on the landlord side, including block-wide programmes for freehold companies and management companies. We check for conflicts before taking instructions and will not allow one to arise.
Send us the lease and describe the problem — the ground rent, the service charge percentages, a plan that does not match the building, a right that was never granted, or works that were never documented. Tell us how many flats are affected, whether the landlord has been approached, and whether any of the flats are mortgaged. With that we can tell you which document is required, who has to join in, and what it will cost. The first conversation is at no cost.
