Liabilities by implication of assignees of a lease to assignor and lessee. -to lessor. general words may be appropriately employed, because A leasehold is always assigned to the purchaser subject to the payment and performance for the future of the rent and lessee's covenants in the lease, and thus an implied covenant by the assignee with the assignor is at law created for payment of the rent and performance of the covenants during the period of the assignee's ownership (q), but not after the assignee has assigned the lease over (r). In Equity the assignee, whether legal or equitable, of a lease incurs a similar obligation both to the original lessee and to his own assignor, and is liable for damage occasioned by his act or neglect while in possession (8); but the equitable liability, if not confirmed by a deed, creates only a simple contract debt, and the Statute of Limitations limits the liability to six years after the cause of suit (t). At law, a legal or equitable assignee is similarly (g) Burnett v. Lynch, 5 B. & C. 589. Beav. 112; Moore v. Grey, 2 (r) Wolveridge v. Steward, My. & Cr. 534. (s) Close v. Wilberforce, 1 (t) Sanders v. Benson, 4 Beav. 350. liable during the period of his ownership to the lessor (u); but in Equity, an equitable assignee is not so liable to the lessor (a). The liabilities of a legal assignee of a lease ought, however, not to be left to implication but to be expressly defined by his covenants, which, as will be immediately shown, the assignor is entitled to under ordinary circumstances. The covenants for title on an assignment of a leasehold are substantially the same as those in a conveyance of a freehold; but though it is no longer the practice (as was formerly the case) for the vendor of a freehold to covenant that he is seised in fee, or that his power of appointment was well created and is in force, it is still usual for the assignor of a lease to covenant that the lease is good, the covenant being qualified, and confined to the acts and omissions of the vendor and his testators and intestates. This covenant is followed by covenants that the rent has been paid and the covenants have been performed up to the time of assignment, for right to assign, freedom from incumbrances, quiet enjoyment, and further assurance. good. The covenant that the lease is good, being obvi- that lease is ously implied and included in the covenant for right to assign, may no doubt be safely omitted. Some difference has existed in the profession with respect to making the covenant that the rent has been paid, &c., general or qualified; but the better opinion is, that this, being merely a covenant for title, falls within the general rule, and that the liability of the (u) Harley v. King, 2 Cr. M. & R. 18. (x) Cox v. Bishop, 26 L. J. Ch. 387. that the rent and covenants have been paid and performed. - for right to assign, &c. -for further assurance. vendor should be limited to breaches of covenant during his ownership (y). Where, however, the vendor is himself the original lessee, so that he alone is responsible for the rent and covenants up to the sale, it seems that the qualifying words have no meaning, and should not be employed. The form of the covenant used in this collection of Precedents is, that the rent reserved by, and covenants by the lessee, and conditions contained in the lease have been paid, performed, and observed up to the date of the assignment, since a breach of a condition in the lease would, in every well-drawn lease, equally with a breach of covenant, have given the lessor a right of re-entry ; but at the present day it is rare to find any condition, properly so called, in a lease, except where the right of re-entry is limited in that shape, all the stipulations of a lease being invariably secured by direct covenants on the part of the lessee. The covenants for right to assign, for quiet enjoyment, and freedom from incumbrances, are always qualified and confined to the acts of the covenantor, or, in cases where the assignee is entitled thus to extend it, to the acts of the vendor, his testators or intestates, and it is improper to except, as is sometimes done, from incumbrances guarded against the rent and restrictions of the lease, which are not incumbrances created by the covenantor, nor indeed are they incumbrances at all in the legal acceptation of the word. The operation of the covenant for further assurance (y) Dart, 354. is confined expressly to the continuance of the lease, and it is hardly necessary, though it is usual, to stipulate that the covenantor will, during the term, execute further assurances, where, as in the present collection, the covenant is only to assure for the residue of the term. Except in cases coming within the rule subsequently mentioned, every assignor of a lease is entitled to a covenant by the assignee that he will pay the rent and perform the covenants of the lease in future, and will indemnify the assignor in respect of them (z); it is unnecessary to extend the covenant to the performance of the conditions of the lease, because a breach of a mere condition, though it might operate as a forfeiture of the lease to the injury of the assignee, would not give the lessor a right of action against the original lessee. The right to this covenant is owing to, and depends entirely on the fact that the assignor, or the estate he represents, will be under a continuing liability after assignment in consequence of a previous covenant entered into for payment of the rent, and performance of the covenants of the lease; and it remains unaffected where the assignor, selling in a fiduciary character, does not enter into covenants for title (a). But where no continuing liability under the covenants of the lease exists in or affects another person after assignment over, there the covenant cannot be required from the assignee. Consequently, upon the assignment of a bankrupt's leasehold, the assignees being by statute and the bankrupt being by (a) Staines v. Morris, 1 V. & B. 8. (2) Pember v. Mathers, 1 Bro. C. C. 52. Covenants where part only of is sold. his bankruptcy relieved from all subsequent liability, the assignee is not bound to give the covenant (6); and the assignor of an underlease who, or whose testator or intestate, has not covenanted to pay the rent or perform the covenants of the original lease, cannot require from his assignee any such covenant as to the original lease; nor if the underlease (as is usual in mortgages of leases) was made rent free, or at a peppercorn rent, and without covenant by the underlessee, can he require such a covenant as to the underlease. Where the covenants in the lease are onerous, or part only of the leasehold is assigned, the assignor should have either a counterpart of the assignment, or a separate deed containing the covenant, he bearing the expense thus occasioned. When part only of the property in a lease is sold, property in lease the conveyance is usually taken by way of underlease, in order that the purchaser may not incur liability under the covenants of the original lease (c), and in such a case, the vendor must covenant with the sublessee to pay the rent and perform the covenants in the original lease so far as relates to the residue of the property (d); the only contract of a sub-lessee is to perform the covenants of the sub-lease (e). Where the conveyance is taken by assignment, it should contain cross covenants and cross powers of distress by the assignor and assignee respectively (ƒ). Covenants by sub-lessee. (b) Wilkins v. Fry, 1 Mer. (c) Burton, § 855 n. 232. (e) Penley v. Watts, 7 M. & W. 608. (f) See a Precedent of such an assignment, infra, p. 367. |