strong>Community Association Sub Lets

1. Sub Lets from Main Lease

1.1 If your organisation is to be allowed to have other agencies occupying regular space in the premises there will need to be a "Permissive Covenant" in the "Head Lease."

1.1.1 Sometimes this will be dealt with at an early stage of drafting of the Head Lease (often when the Local Authority wish to ensure you take on board a specific sub tenant they are anxious to ensure has protected occupation).

1.1.2 Be very careful - ensure no matter what the Local Authority say, that you and your Solicitor design the Sub Lease. There are many examples of "shotgun weddings" that are certain to come to grief!!

Golden Rule: "The Tenant (with appropriate independent legal advice) designs the terms of the Sub Lease."

2. Sub Tenancy Agreements

2.1 Local Authorities will (understandably) wish to ensure that they restrict you from offering sub lets that give "Tenancy Rights." Wherever possible it is essential that you seek to ensure you convince Local Authorities of the need to provide "Occupation Licences" and not "Sub tenancies."

2.2 Local Authorities will shy away from "Occupation Licences" because they are (understandably) concerned that these may not be "Court proof" and will inevitably mean you have given sub tenancy rights of occupation under the Landlord and Tenant Act.2.3 Good "Court Proof" Occupation Licences exist - call us and we will give you examples.

2.4

Sub Leases will cost you "mega bucks" - "Occupation Licences" are far less costly.

2.5 A good example of an "Occupation Licence" is that designed by Community Matters trading arm (CTS Ltd) as appropriate when separating Bar Trading activities and establishing a separate organisation to manage the trading arm/social club.

2.6 Other good examples are available.2.7 This is a hard one to win the confidence of local authority legal departments too.

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