Legal

Solicitor or Licensing Consultant

Having got this far you need a Solicitor and again one that deals with the latest change in the licensing laws, or you could use a licensing consultant, who will be up to speed on the licensing laws.

You will need to do the NCPLH which is the National Certificate for Personal Licence Holders. Having passed this exam you then apply to the local Licensing Authority for your personal licence, which in all probability is the local authority in the area where you are living, not where you are about to live at some stage. If you move you must register the change of address with the Authority where you got your licence. If you do not you are liable to be fined quite seriously.

If you have a conviction check with the local police as to whether it is no longer relevant or that it will exclude you from getting a licence. Do that before you apply for a licence or commit yourself to buying a licensed business. A drink driving conviction can be a problem.

Essential Qualifications

It is advisable to do a three or five day course depending on your time and availability with the BII (British Institute of Innkeeping – http://www.bii.org/ ) they are also responsible for setting and administering the NCPLH. The three day course is an Introduction to Licensed Retailing. They have accredited Trainers all over the country. They set the price of the qualifications but they do not set the price of the training so shop around for the nearest and most convenient course to you. You should not have to travel miles to do a course, which frequently happens with advice from organisations who are not intimately involved in the industry.

Check with the HCIMA www.hcima.org.uk on any possible short training courses for hoteliers, they like the BII have trainers in various parts of the country, but not on the scale of the BII.

If you or anyone that you are putting through a BII course suffers even slightly from dyslexia or a similar disability they have to make special provisions for them, if they do not or refuse to, contact the BII immediately on 01276 684449.

Licence Applications

Ensure that all your licence applications, personal and eventually the premises licences etc are all in order, your solicitor should handle this. If you have taken the exam (NCPLH) you are perfectly entitled to apply to your local licensing authority to get your personal licence, even though you are not involved in the business or have any premises at this moment of time. The licence is for ten years – at this moment of time it costs £30.00. If you let your solicitor handle it he will put his own costs on top. He will apply for the premises licence or transfer and nominate the premises supervisor whoever you decide is going to hold that position.

Gaming Licence for Fruit Machines

If the vendor has a gaming machine ensure your solicitor makes the correct application and is aware of the fact that there is a gaming machine on the premises.

Entertainment Licence

Again ensure that your solicitor is well aware of any entertainment licence and subsequent conditions that are in force in respect of providing live entertainment. You will need to refer to the existing premises “Operating Schedule” this tells you exactly what limitations and conditions have been imposed by the licensing authority on the premises in respect of entertainment and everything else.

Contact:- John Gaunt and Partners for all the latest Licensing Guidance at www.john-gaunt.co.uk   email:-  info@john-gaunt.co.uk.

Environmental Performance Certificate

Make sure that your Solicitor ensures that an up to date EPC Certificate (Environmental Performance) is available. An asbestos and Gas check has been carried out and documented

Operating Schedule

This is the operating schedule in respect of your agreed licence with the local licensing authority under the new licensing act.

Get a photo copy read it and fully understand it and make sure your solicitor is well aware and has advised you on any key points.

You may find that because the licence runs to 1.30 am on three nights that you have to have a door supervisor for those nights. He has to have done the Door Safe exam and be registered with the SIA (Security Industry Authority – http://www.the-sia.org.uk/) If he is not you cannot use him and you could be heavily fined if you do so. You cannot use a friend or member of staff who is not a registered doorkeeper if your operating schedule states that you must have a door supervisor at specified times. You may find that because the business is in a high risk built up area that they may require a Personal Licence Holder to be either in attendance at all times that you serve alcohol or in close proximity. You need to check the local licensing authorities policy on the need for a Personal Licence Holder to be around and in some cases how many you may need to operate.

Gaining Experience

If you have no experience in the industry a three or preferably a five day British Institute of Innkeeping (BII) course will give you an insight, try and find a local publican or hotelier who may appreciate your help in return for some guidance on what to look for and do. The vendor of the property you are buying should allow you at least a weeks experience on how the business runs. Do not take everything that the vendor says as gospel, make up your own mind as to what is good practice and fact. This training period will only occur after you have exchanged contracts, they will never let you in before exchange. It is very advisable to get as much experience before committing yourself to ensure that you are compatible with the business, eating and drinking in a pub or hotel is a million miles away from running one.

Freeholds and Leases etc

Ensure that whichever Solicitor that you use is experienced in commercial law and selling commercial property. It is not like house conveyancing.

It is easier if you are buying a freehold pub. You should always have a survey. Business premises are notorious for old plumbing, DIY wiring etc. especially with leases, always agree the dilapidations with the Pub Co before you sign a lease.

If you are buying a lease, ensure that you are fully aware of all the restrictions, trading and property wise that the landlord has included, make sure that you are fully aware of the basis of rent assessment and that your solicitor is not letting you sign a lease where the landlord has free reign to do what he likes on this matter, I see too many people who sign the lease with their eyes shut.

Beware of the Privity of Contract in Older Leases.

The principle in English common law that landlord and tenant continue to have obligations under the lease despite subsequent assignment. Privity of contract was abolished for new leases coming into force from 1 January 1996. Leases entered into before then are still subject to privity, but landlords wishing to sue previous tenants still bound by privity have to serve notice within six months of rent or service charges becoming due. The current legislation enables landlords in certain circumstances to require the outgoing tenant to guarantee the performance of the incoming tenant, until there is a further assignment.

Seek advice from your Solicitor on the “Privity of Contract” it has been largely removed but there are still companies out there trying to impose it in some shape or form. Some insist on a Privity Clause (referred to now as a Authorised Guarantor Agreement or AGA) in respect of the person or persons that you assign the lease to, which means that you are ultimately responsible for any failure on their part in respect of the Landlord for the duration of their leasing of the property, also the Landlord is entitled to come back to you for any failure to maintain the property during this period (Dilapidations). It is possible to negotiate the Privity of Contract or AGA aspect out of a lease with some companies, though the majority refuse point blank and it has in principle become standard form in any commercial property lease. It is seriously worth investigating forming a Limited Company in respect of the leased property and after the assigning of the lease to a new tenant, liquidate the company. If you are a sole trader or partner you can be caught at any time of the lease’s life in respect of your assignee. The Pub Co’s are often reluctant to accept a Limited Company since a liquidated company has no assets for this reason.

Looking at it from a purely practical viewpoint the company will not let anyone take a lease whose references etc will not stand up to scrutiny, so effectively you cannot let to any “Tom, Dick or Harry”, it is more important that the assignees references stand up from your side rather than the landlords, because of the longer term implications. In this increasingly litigious world it could be argued that commercial agents should exercise more care in selecting possible assignees for leases, since they supposedly have a duty of care to the vendor??? Their favourite expression if they are ever quizzed over the quality of would be purchasers, they are vehement that the decision in choice of assignee is not theirs but the vendor and there is no way that they could be held responsible, which makes it vital that you ensure yourself of the real quality of a would be purchaser. If someone fails the company can then rewrite the lease to suit their latest set of conditions, they are also legally entitled to have the property brought up to their required standard at the lessee’s or previous lessee’s expense. If you have not had a survey done when you took over the lease you do not have a leg to stand on in respect of the extent of the work required by the landlord, it may cost you extra money but it may save you a fortune at a later date with sharp landlords.

A very useful Web Site is the “Glossary of Commercial Property Terms” issued by the Department for Communities and Local Government www.odpm.gov.uk , this explains in simple terms the majority of legal phraseology involved in property purchase, if you do not know what it means check it out i.e. Privity of Contract, the majority of people would never associate this term with what it actually refers to and it’s possible draconian results.

Make sure that your solicitor will not let you sign the lease if there is an outstanding schedule of dilapidations or if the landlord is about to do this. Always have a survey, especially with leaseholds, if landlords change it is one of the oldest games in the book to send a Surveyor round to check the property and then bang a schedule of dilapidations on the new lessee just to get the property up to scratch or put them under pressure to quit, especially if the new landlords feels that they can get a better rent with a new lease. Something that I fail to understand is that they very seldom seem to do it to an exiting lessee, they appear to wait for a change before this happens.

A tenancy can be the least complicated, but again you need legal advice and help, the same as for a lease.

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