The parties involved are Jaeger and Chopard.

In advising Jaeger, the issue is

whether Chopard has a legal or equitable lease, and whether the covenants are
enforceable by Jaeger.

First, it must be noted that the lease was granted in 2015, so the lease is governed
by the Landlord and Tenants (Covenants) Act (LTCA) 1995 which applies to all
leases, whether legal or equitable, granted on or after 1 January 1996. All 3
covenants are proprietary in nature as they ‘touch and concern’ the land within the
test laid down in P&S Swift Investments v Combined English Stores.
Consequently, the covenants will be able to run with the land. Establish partes?

The first issue is whether Jaeger can enforce the covenants. Under S.3 LTCA 1995,
the benefit and burden of all leasehold covenants shall pass automatically to
assignee of the lease or reversion, provided that the covenants are not expressed to
be personal. As Chopard is an assignee of the tenant, Ulyzze Nordin, and as none of
the covenants are personal, Chopard will be subject to the burden of all 3 covenants.
Meanwhile, the benefit obtained by Journe for the leasehold covenants by Chopard
will pass automatically to Jaeger, Journe’s assignee for reversion. Jaeger will be
able to enforce the covenants.

The next issue is whether the burden of the covenants will be passed from Ulyzze to
Chopard. As mentioned, the burden of the covenants will be statutorily transmitted to
Chopard as they are not personal in nature (S.3 LTCA 1995). Ulyzze will be
released from his covenants and will not be liable for breach of the covenants by
Chopard (S.5 LTCA 1995). This is shown in London Diocesan Fund v Avonridge
Property. Ulyzze’s guarantor, Constantin, who guarantees the performance of
Ulyzze’s covenants, will also be released from liability (S.24 LTCA 1995). However,
the statutory release in S.3 are not applicable under the situations in S.11 LTCA
1995. One of the situations is the presence of an authorised guarantee agreement
(AGA) (S.16) between Ulyzze and Journe when the lease was assigned to Chopard.
An AGA will ensure that Ulyzze bears the ongoing liability for any defaults of
Chopard. On the facts, there was no AGA but if there is, Jaeger is able to enforce
Ulyzze to carry out the covenants breached by Chopard. Additionally, when the
landlord seeks to claim for fixed charges, he must issue a ‘problem notice’ that
notifies the original tenant that the rent is due and that he intends to recover the
amount from the original tenant (S.17). The fixed charge includes rent (S.17(6)), thus
Jaeger must issue a ‘problem notice’ to Ulyzze to claim the rent amount. Therefore,
Jaeger can only enforce the covenants against Chopard. If there was an AGA signed
with Ulyzze, Jaeger will be able to enforce the covenants against Ulyzze.