I received the following response today from Lambeth Council via post. As you suspected
@mrmustard, they have rejected the grounds of inadequate signage.
Regarding the point of their right to transfer liability, they actually start the letter by saying they are unable to consider a representation from a third party, given I am effectively unknown to them as the registered keeper of the car will be the leasing company.
They say they have put the case on hold for 14 days to allow the registered keeper to make the representations on my behalf or make the discount payment of £65.
Given the leasing company will not do that; as far as they're concerned, liability for any parking fines are my responsibility under the leasing contract; what should my next step be?