I have had some PM,s asking me about the lease flying I have been doing over the last 20 years or so . The answers are better on the open forum than private . So in brief ....
1). Is it legal ? Yes . It has always been legal to lease an aircraft to someone who then becomes the "operator". They pay you for the aircraft and then provide their own pilot ( who is acceptable to you ). These flights are categorised as Private hence you can throw away most of the rules regarding SE flight for AOC,s.
2). What documents do you need ? There are plenty of lease agreements out there . Just make sure the customer has signed the agreement . Make sure you only charge for the " rental period" and NEVER pay the pilot yourself as that is then a charter .
3). Have the CAA ever attacked this ? No , not as far as I am aware . It was in fact the CAA who told me I didn't need an AOC .
Fly safe and stick to the rules !!!