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Jeremy Aldermartin
Jeremy Aldermartin, Solicitor
Category: Property Law
Satisfied Customers: 4788
Experience:  Dual qualified Solicitor and Attorney
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What is the impact of shadow license on the tenants? And who

Customer Question

What is the impact of shadow license on the tenants? And who is in advantage with shawdow license
JA: What steps have been taken so far? Has any paperwork been prepared or filed?
Customer: The landlord is going to file for shadow licence this week. And just want to know in the situation of Covid19 we(tenants) were not able to trade.
JA: Where is the property located?
Customer: Westminster
JA: Anything else you want the Lawyer to know before I connect you?
Customer: We want to know what to know the uncertainty.
Submitted: 15 days ago.
Category: Property Law
Expert:  Jeremy Aldermartin replied 15 days ago.

Hi thank you for your message. shadow licence is appropriate in situations of lienced premises, the licence may add considerable value to the premises. It is possible for the landlord to protect the Premises Licence by creating a "shadow licence". The concept of shadow licences was approved in Extreme Oyster & Star Oyster Ltd. v Guildford Borough Council (2013).

Where a landlord’s licensed premises is operated by a tenant and the licence is held in the name of the tenant (as with Extreme Oyster) there are several ways in which the tenant’s actions could have a negative impact on the licence: these include where the tenant might become insolvent or bankrupt (which will cause the Premises Licence to be automatically revoked), or the licence could be reviewed due to poor management of the premises resulting in restrictive conditions being added, hours cut back, or even revocation.

Whilst landlords frequently try to protect themselves by making provisions in the lease, which may give the landlord a right of action against the tenant, they cannot prevent a licence from being reviewed or even lapsing. A shadow licence prevents this problem for the landlord. Therefore, it does not have a disadvantage for the tenant and protects the landlord against the loss of the licence. I hope this helps, if you can please accept my answer and rate me 5 stars (in the top right of your screen) then Just Answer will credit me for helping you today.