Buying or Selling Licensed premises
Clarkson Hirst Solicitors have a wide range of experience of buying and selling licensed premises. Our work includes advising on and drafting leases of licensed premises. If you are developing your licensed premises then we can provide you with advice on conditional contracts and development agreements.
If you are thinking of taking a lease, purchasing a lease or purchasing a freehold public house, restaurant, nightclub or retail shop with an off license then you should consider the following;
If you are purchasing an existing leasehold interest then check the lease provisions as to whether the landlord’s consent to assignment is required including whether there is an offer back clause. If you are proposing to borrow money and taking a legal charge on the property then the lease needs to be checked to see if there is a requirement for obtaining the landlord’s consent to charge the lease. It would be advisable to carry out a local authority search and environmental search. It would be wise to carry out a drainage and water search as some public houses in rural areas are served by a private drainage supply such as a septic tank. It is important to undertake a survey of the property as often pub leases include a put and keep repairing obligations which is an onerous obligation. It would be wise to agree an inventory of fixtures and fittings and those assets which are excluded. That would include for example the dispensing equipment and cellar cooler. Are these owned by the seller or the brewery? You need to agree a maximum level for stock (being the wet and dry stock) and in date useable stock plus loose items such as crockery and glassware. You need to obtain details of any advance bookings to be assumed by the buyer for example hire/functions. You need to check whether the inventory can be charged (when purchasing a leasehold interest) if a debenture is to be given as security You need to check the premises comply with gas and electricity regulations You need to check the property complies with fire requirements. You need to ensure a fire risk assessment is carried out in accordance with the Regulatory Reform (Fire Safety) Order 2005. You need to obtain required health and safety certificates You need to ensure that an asbestos survey and risk management plan is in place pursuant to the Control of Asbestos Regulations 2012 You need to obtain a copy of the existing premises license. You need to check the permitted trading hours and other conditions of the premises license. You need to check if you plan to alter the premise license and if so an application will need to be made to vary the premises license. You need to check the identity of the proposed designated premises supervisor who must hold a personal license. You need to check who owns the amusement machines in the public house and if they are included in the sale. You need to check if there are gaming permits required. You need to contact the licensing authority and police about the history of the premises and obtain written confirmation that there are no issues or proceedings pending. If the license permits sale of alcohol after midnight contact with the licensing authority and police to confirm that there are no early morning alcohol restriction order or late night levy in place or contemplated. You need to carry out thorough due diligence of the employees and obtain information to comply with the transfer of undertaking regulations. You need to check the supply arrangements proposed in the lease. Are you taking a tied lease? You need to check whether VAT will be charged on the sale proceeds if you are selling or whether the property can be transferred as a going concern with no VAT payable. You need to check and ensure the seller is VAT registered. You need to check and ensure that the buyer is VAT registered You need to take great care to ensure that VAT does not become payable on the sale or purchase. You need to check whether you plan to continue the business name and if you plan to change it whether the lease allows you to change the name. You need to obtain advice from your accountant in order to ascertain whether capital allowances are an issue. If they are an issue they should be dealt with in the contract. You should carry out a thorough assessment of health and safety issues including electrical installations, gas safety, emergency lighting, alarm testing, fire extinguishers, portable appliance testing and lifting and hoist tests. You should obtain a full insurance record for the building to check if there has been any claims and if the property is free from onerous insurance obligations and premiums.
Get expert legal advice on your pub sale or lease and we offer a free initial meeting.
Please contact our firm’s Senior Director and Solicitor Matthew Winder at our Kendal, Lancaster and Barrow in Furness offices.