The High Court has considered the effect of an assignment of a lease by a tenant to its guarantor and held that under the Landlord and Tenant (Covenants) Act 1995 (LTCA 1995) a tenant is precluded from assigning its lease to its guarantor. 

The assignment is void by virtue of section 25(1) of the LTCA 1995 as it frustrates the purpose of the LTCA 1995. The assignment does not take effect to vest the lease in the assignee. The lease remains vested in the tenant and the tenant's guarantor remains bound by its guarantee. (EMI Group Ltd v O & H Q1 Ltd [2016] EWHC 529 (Ch).)

This issue was one of the points not settled by the Court of Appeal in K/S Victoria Street v House of Fraser (Stores Management) Ltd and others [2011] EWCA Civ 904.