Overview

In February last year the decision in Good Harvest Partnership LLP v Centaur Services Limited indicated that once a tenant had assigned its lease, its landlord could no longer call on the former tenant's guarantor to fulfil its obligations under an authorised guarantee agreement, regardless of the terms of that guarantee or the surrounding commercial circumstances. This decision was followed in K/S Victoria Street v House of Fraser, which was subsequently appealed. The Court of Appeal has now provided clear guidance that whilst the guarantor of an assignor cannot normally guarantee the liability of an assignee, it can do so by being party to a valid AGA.

This briefing looks at the background to this decision and what it means for landlords and tenants.

To read on, click ‘View Briefing’.