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How enforceable is a solar panel lease?

Solar Panels

The Solar Panel industry has seen some dramatic growth in the last couple of years with particular attention to the governments Feed in Tariff (“FIT”) scheme prompting some of this growth. The FIT is being cut in December, which may cause a reduction in the amount of schemes or installations that are being offered for free. If you are a business installing these types of systems under this scheme now might be the time to ask yourself the questions below to ensure that you are up to date with the registration of the leases for the panels.   

Particular attention should be paid to the following:

1.        Ensure that both registered proprietors are parties to the lease. Failure to get both the owners signed onto the lease will not potentially make in enforceable (as one owner may claim no knowledge of the agreement) but it will prevent the lease from being registered against the property;

2.        Ensure that the lease is registered. This might sound obvious but just because the lease has been signed by both parties does not mean that it will protected against a bona fide purchaser for value, e.g. a normal purchaser. The situation could arise where the panels are installed; the owner subsequently sells to a buyer in good faith. If the lease is not registered then the buyer will have no knowledge of its legal status and can take the property free of the lease. You will obviously have an action against the original owner (if you can find them) but would perhaps not want the hassle of having to go through this process;

3.        Perhaps the most important aspect is gaining the lenders permission. Most properties will have a lender on the property whose permission will be required before the lease can be registered against the property. Although most lenders will be prepared to give permission, this is not a given and some lenders have refused to register the lease. The lenders that are prepared to register the lease may charge for the permission or want to alter the lease as a result of the lease not being compliant.    

Should the above be of interest to you or you have questions in relation to the above please contact William James on wjames@fidler.co.uk or contact me on 01623 451111 or alternatively visit our website.

 

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