The Harrison Drury Blog

5 things a tenant should know about commercial leases

Office to lease

The majority of businesses need premises to operate from, whether they be for offices, workshops, factories or storage facilities. While some businesses own the premises they operate from, most occupy under a lease paying a market rent. But, there is more to a commercial lease than the payment of rent and the answers to the following commonly asked questions will give potential business tenants some useful guidance:-

1. Once I have signed the lease can I get out of it if my business suffers a downturn?

Leases are generally granted for a fixed period of years known as a term.  The lease term can only be ended early by the tenant if, prior to entering the lease the landlord has agreed that the tenant has an option to do so, or, the landlord later agrees to release the tenant from the lease before the term has expired.  If neither of these situations arise, and you cannot find an acceptable replacement tenant for the premises, you may well remain bound to pay the rent and comply with all other obligations until the end of the lease term, even if you have vacated the premises.

2. I know there will be rent to pay, but are there any other costs I may be responsible for under the lease?

If you are renting part of the landlord’s building such as an office block, you may also have a responsibility to contribute to the upkeep and maintenance of common parts of the whole building such as the roof and structural walls, or other things that are used in common with other occupiers of the landlord’s property, such as lifts or a reception area.  This is often referred to as service charge.  The tenant will also be responsible for the payment of the insurance premium for the premises to cover damage to the premises and also the loss of rent the landlord may suffer if the premises become unusable due to such damage.

There can be a cost if you want to transfer the lease, or sub-let part of the property to someone else, as you will usually need the landlord’s written permission, and the landlord can normally claim the cost of considering whether to agree to the transaction and also drafting and agreeing the form of the written permission.  Finally, you will usually be responsible for the business rates, utilities and any other outgoings in relation to the premises.

3. If I find that there are repairs required to the premises, am I right to think the landlord will sort them out?

Most commercial landlords not only seek to avoid any responsibility to carry out repairs to the premises, but will actually seek to put the responsibility for putting the property into repair on the tenant’s shoulders.  A tenant who agrees to a full repairing obligation can find himself with a repairing bill running into tens of thousands of pounds when the lease ends, despite the fact that the disrepair pre-dated the lease itself.  A well advised tenant will try to limit his repairing responsibility to keeping it in no worse state than it was at the date of the lease.  For this reason, it is highly recommended that an ingoing tenant obtains a survey to check and record the condition of the premises before they enter into a lease.

4. What happens if, after I have taken the lease, I discover there are problems relating to the premises that impact on my business?

The principle of “buyer beware” relates to a tenant taking a lease in the same way that it does to a purchaser buying a property, meaning that a tenant takes a property “warts and all” and he must satisfy himself that it is suitable both physically and legally for the use he intends.  The research into the property carried out by a good lawyer will reveal many things about the property, including whether the landlord actually has the power to grant the lease, any adverse rights that may affect it as well as any rights that benefit the property such as rights of way.   Lawyers can carry out a range of enquiries and searches to discover such things as planning permissions affecting the land, whether the property is connected to the public highway, whether there is any risk that the premises may be on contaminated land, whether the is a risk of subsidence due to historic mining in the area, whether the property is connected to mains utilities and a host of other information.

It is common for tenants who have not been represented by solicitors to enter a lease without finding out any of this information.  If a problem rears its head in such a case, say for instance the property does not have planning permission to use it for the tenant’s business, he will have no comeback against the landlord and the tenant will have to continue paying the rent despite the fact he may have a useless asset.

5. I’ve heard that a landlord can change the locks of my business premises if I am late paying the rent, is this true?

In short, yes.  The powers of a commercial landlord to deal with non-payment of rent are far-reaching.  Forfeiture is the procedure by which a landlord can terminate a lease and virtually all commercial leases will have a clause allowing the landlord to terminate the lease if the rent is unpaid for a specified number of days, usually somewhere between 14 -28.  Unlike their residential brethren, commercial landlords do not need a court order to retake possession of leased property if their right to forfeit the lease has arisen because of late payment of rent.  Landlords also have the right to send bailiffs in to seize the tenant’s goods and sell them if the rent is unpaid, but legislation will soon come into force to restrict this right.

The above answers cover some basic issues relating to commercial leases, but in reality only scratch the surface of what is a complicated topic.  If you have any queries relating to commercial leases please comment on this article and I will try and answer them.  I will also be posting further blogs on different aspects of commercial leases and commercial property in general and welcome and comments and contributions you may have.

646 Comments

By Ghulam Patel on June 1st, 2016

Hello, I’m from England and I am the tenant of a commercial property for the past few years. The first two years of my tenancy, I paid the insurance premium for the building insurance after the landlord took it out. On the third year the landlord refused to shop around for cheaper insurance choosing to continue renewing the more expensive premium. This lead to me inspecting the lease more closely and it turns out that the clause about the tenant repaying the insurance premium to the landlord is missing! Since then I stopped paying the insurance premium as technically I’m not supposed to pay as per the lease. In fact the only reason I was paid for the first two years was because I did not read the lease carefully and the landlord’s insistence that the clause for the tenant paying the insurance premium was in the lease. Now that the lease is up for renewal, the landlord is now threatening to go to court and I wanted to know what to do? On one hand I can call his bluff and see if he really goes to court (if this were to happen what are his chances of winning), or I can accept to pay the insurance but would demand my money back for the first two years considering I wasn’t legally obligated to pay that money in the first place as per the terms of the lease.

Any help would be appreciated, thank you.

By Jacob Walker on June 1st, 2016

Dear Ghulam

Thank you for your comment relating to our blog post on commercial leases. Your comment raises a number of issues, which I will attempt to deal with in turn.

In relation to whether there is a duty for a commercial landlord to shop around for insurance, I cannot comment specifically on your case because I do not have full details; however, generally, the landlord is not obliged to procure insurance at the cheapest cost following the cases of Havenridge Limited v Boston Dyers Limited [1994] 2 EGLR 73 and Berrycroft Management Co Limited and others v Sinclair Gardens Investments (Kensington) Limited [1996] EGCS 143.

Unfortunately, it is impossible for me to advise on the prospects of the landlord’s threatened Court proceedings against you (presumably for recovery of the insurance premiums) without sight of the lease in question and any other relevant correspondence and documentation. This is potentially a complex matter, but it would be unusual for a commercial tenant not to be obliged to repay the insurance premiums to the landlord. In order to advise you, we would first need to ascertain your position under the lease.

In terms of lease renewal, you may have a right to request a new lease (known as “security of tenure”) pursuant to the Landlord and Tenant Act 1954, but it is possible that this security of tenure is ‘contracted out’ (excluded) in your lease. Again, in order for us to advise you further, we would need sight of the lease. If you are entering into a new commercial lease, we would always advise that you seek legal advice before doing so.

If you require our further assistance, our commercial property and property dispute resolution teams would be very happy to speak with you further. Please do not hesitate to get in touch.

By Jack Stephenson on June 1st, 2016

Dear Nilufar

Many thanks for your comment.

Unfortunately it is difficult to advise without sight of your lease / license. Whether they are able to move you to another part of the building will ultimately depend on the terms under which you occupy the office.

Apologies I cannot be of more assistance, however if please feel free to send a copy of the document to jack.stephenson@harrison-drury.com in order to discuss this further

Kind Regards

Jack Stephenson

By Tracy Welton on June 2nd, 2016

Hi,I have leased my shop from the same landlord for 27 years.The lease expired in Sept 2012..on the year of March 2011,the landlord verbally agreed to reduce the rent by £1000 per year.Since
March of 2011,I have been paying £10.000 instead of £11.000.The landlord is now asking for the £1000 per year back amounting to £4500, can he do this even though the lease expired in 2012.
Your help is appreciated.
Tracy

By Ben Jones on June 2nd, 2016

Hi I signed a lease back in sept last year to rent a property to run my business, the people who are my landlord sublet this to me, I paid £6000 deposit and 3 months up front rent as well as paying money for the contract building insurance ect, I found out in the Dec last year that the superior landlord didn’t know I was in the Building and they had got me in there illegally without a license to sublet, he was happy for me to stay and would grant the license to sublet if the people who sublet to me fix all there breaches and pay there outstanding bills. I was advised not to pay them any more money until the license is granted, this has been going on from January to the current date, my solicitor has just received a new lease which needs to be negotiated, the people who sublet to me, have threatened to not let me into the building if I haven’t signed the lease in 3 days, which is very unfair as the lease needs to be worked on, could anyone advise me on my rights of occupancy, as the new lease is in negotiation, and when it is done and signed I can transfer the money owed, where do I stand on periodic or lease will

By mark on June 6th, 2016

Our landlord has sold the building of our business and we now have a new landlord, do we still need to honour the new lease that was signed with the original landlord which was signed just 5 months before the sale or do we have a case to get out of our lease as the paperwork was never signed with this new landlord ?

By Trevor Wilson on June 7th, 2016

My friend signed a lease agreement and because of business and health issues handed in her notice after a year. She has complied with the terms and provided 4 months notice however, the landlord and agent who look after the property have continually ignored all correspondence and are making her pay business rates as they are refusing to accept the notice as she has not ‘Decorated the property to the Landlords satisfaction’ although not one person will tell her what this ‘satisfaction’ ie: colour, paper, pattern or style meets this criteria. All the while she is having to pay business rates. Is this legal to refuse to correspond or accept notice to leave?

By Liz Cooksey on June 11th, 2016

Hi we lease a shop with a flat above which we sub let however the roof has been leaking now for 12 months in my lease my landlord is responsible for the roof but despite my consent requests has failed to get it repaired and quite rightly my tenant is suffering but I don’t have the funds to repair the roof first and then try to reclaim from my landlord. Advice on my rights and what I should do would be appreciated.

By Aslam on June 12th, 2016

I have signed a commercial lease on my name only, if I break the contract can the landlord come after my house which is on my name as well as my wife’s.

By Jack Stephenson on June 17th, 2016

Dear Aslam

Many thanks for your query.

If you breach the lease and the landlord obtains a county court judgement against you, one possible way to secure the judgement is by way of a charging order.

A charging order secures the judgement against a property. If the property is in joint names, the charging order would only cover your beneficial interest in the property, not your wife’s.

One way to enforce a charging order is by applying to the court for an order for sale. Whether an order for sale is granted would ultimately be at the court’s discretion, however I am unable to advise on the prospects of this without obtaining further information from you.

Please feel free to contact me on 01772 429 207 or jack.stephenson@harrison-drury.com in order to discuss this further.

Kind Regards

Jack Stephenson

By Simon on June 18th, 2016

Hi there,

I am the leaseholder of a restaurant. A third party driver crashed through the premises causing structural damage and now the building has become uninhabitable whilst his insurers deal with the repairs, which could take up to 6 months.

Apparently, as the lease does not have a rent cessation clause means I will be liable to continue paying rent even though the building is unusable. Is there any legal standing or case law to help my situation? Having to continue to pay rent will hurt my cash flow ability to look for alternative premises and my insurers will be less likely to fund alternative premises if they’re covering my rent.

Many thanks – Si

By Ruth ferguson on June 20th, 2016

How much time I need to give my tenant if I decide to sell my commercial property?

By Jacob Walker on June 20th, 2016

Dear Simon

Thank you for your query.

Whilst I cannot advise you without sight of the lease in question, in general terms it is common for a lease to contain a ‘rent suspension’ clause, which would operate where the tenant’s demised premises are damaged or destroyed so that they are unusable by the tenant. Depending on the type of damage and the drafting of the clause, the tenant may be relieved of the obligation to pay rent for the duration of the rent suspension period. Such a clause would usually be accompanied by a requirement that the landlord take out loss of rent insurance to cover that period. During the rent suspension period, while the tenant is not paying rent, the landlord would receive an amount equal to the rent through its loss of rent insurance.

If a lease does not contain a rent suspension clause, the default position would be that a tenant remains obliged to pay rent under the lease, even where the premises are unusable. A Court may in certain circumstances imply a term into a specific contract to fill a gap in the contract’s drafting, in order to reflect the parties’ intentions when the contract was entered into. However the test is an objective one, and the Court will consider what a reasonable person would have understood the parties’ intentions to be, given the background knowledge reasonably available to the parties at the time they entered the contract. The courts will not imply a term into a contract simply because they think it would have been reasonable for the parties to have done so (Liverpool City Council v Irwin [1976] UKHL 1).

I cannot advise you on your position in these specific circumstances without sight of the lease in question and absent any further information relating to the circumstances in which you entered into the lease. However in general, the Courts have shown reluctance to imply terms into commercial leases. The recent Court of Appeal case of Marks and Spencer plc v BNP Paribas Securities Services Trust Company (Jersey) Limited and another [2014] EWCA Civ 603 overturned a decision of the High Court to imply a term relating to a break clause into a commercial lease, on the grounds that the lease, read as a whole against the relevant background, would not reasonably be understood to include the term. The test for an implied term had therefore not been satisfied.

If you require specific advice on your position under your lease, please contact Jacob.walker@harrison-drury.com or a member of our Property Dispute Resolution team, and we will be happy to discuss this matter with you further.

Kind regards

Jacob Walker

By Sue on June 23rd, 2016

Hi
I have rented a commercial property to a Tenant with no lease for approximately 10 years. Can I give them notice to leave to sell the building? If so how much notice do I have to give them
Thanks
Sue Bailey

By Helen on June 28th, 2016

Hi,
My lease states that the landlord can re-enter the property if any rent is unpaid 21 days after becoming payable.
It also states;
‘If the landlord re-enters the property (or any part of the property in the name of the whole) pursuant to this clause, this lease shall immediately end, but without prejudice to any right or remedy of the landlord in respect of any breach of covenant by the tenant or any guarantor.’ My question is, if the landlord re-entered the property, thus ending the lease, would I still be liable to pay rent after the end of the lease (that is the date of re-entry), or would I only be liable for rent up to the date he re-entered?
Thanks,
Helen

By Matthew Astley on June 29th, 2016

Dear Helen

Thank you for your query; I will aim to address the issues raised in it by first giving you a general overview of the applicable law in this area. Unfortunately, I am unable to provide specific legal advice on your query without sight of your lease.

Business tenancies which meet certain criteria are protected by the Landlord and Tenant Act 1954 (“LTA 1954”). The LTA 1954 allows termination of a protected lease by different methods, one of which is “forfeiture”. It is possible for a landlord to “forfeit” a business lease either by peaceable re-entry or by going to court to bring forfeiture proceedings against the tenant. Re-entry is the process under which the landlord exercises a right under the lease to terminate it in the event of a default by the tenant or a happening of a certain event. Forfeiture can take place during the term of the lease.

You have stated that in your lease there is an express reservation that your landlord may enter the property if the rent is unpaid 21 days after it is payable. It is further clarified in your lease that your landlord need only re-enter part of the property in the name of the whole. This is to address a situation where the landlord is unable to gain access to the whole of the property, but wants the re-entry to be effective for the whole of the property let to you. Clauses, such as the one you have described, permitting forfeiture on the basis that rent is unpaid for 21 days are common in commercial leases.

I will turn now to your specific query over whether you will still be liable to pay rent after your landlord has forfeited your lease. The brief answer is that if the lease is successfully forfeited, then this will end the contractual term and the protected tenancy. In short, as soon as the lease is forfeited, the lease comes to an end. However, the landlord may still have claims against you for outstanding rent prior to forfeiture; for other breaches of covenants (e.g. repair); and for its costs, among others. Again, I cannot advise you what your potential liability would be without knowing more about your specific situation.

One thing you should be aware of is that the tenant can apply to the court for relief from forfeiture if a landlord re-enters a commercial property. If such relief is granted, the effect is as if the lease had never been forfeited and the tenant’s statutory rights to a lease renewal are also resurrected.

As mentioned above, in order to give full advice tailored to your query we would need to see a full copy of the lease. This would allow full consideration of its terms, including the clause you mention purporting to reserve the right to re-enter the property following non-payment of rent, and the document as a whole. It would be particularly important to examine whether the forfeiture clause in your lease requires your landlord to make a formal demand for the outstanding rent before peaceable re-entry.

To receive specific advice on your position under your lease, please feel free to either contact me, on 01772 429209 or at matthew.astley@harrison-drury.com , or a member of our Commercial Property team, in order to discuss your query in further detail.

Kind regards

Matthew Astley

By Steve Man on July 2nd, 2016

I leased a commercial premises 15 years ago in Suffolk and it has since come to light that the lease states the wrong planning category (A1/A2) despite also stating its a restaurant. Can the landlord (not the original landlord) revoke the lease as they are saying I am in breach of the terms? What do I need to do to get this amended? They were aware when they took over the building 10 years ago that it was a resturant.

By Rajesh Kumar Arora on July 4th, 2016

I have been running retail business from a rented property. for which rent agreement was done for 3 years. which is now coming to end after 3 months. i was asking for renewal for which he never denied and always said, i will never ask you to vacate, and renew the agreement. but in the last few days his tone has changed. i afer resigning from my job started business of retail grocery store with all my savings. now i cant vacate this place as i have spent lacs of rupees on infrastructure and stocks. let me know and guide what can i do…I have never defaulted on Rent and always paid rent in advance for. when ever my land lord wanted some money he took from me as rent advance. Guide me

By Jacob Walker on July 6th, 2016

Dear Rajesh

Thank you for your query.

You mention rupees, which seems to suggest that your query relates to a jurisdiction other than England and Wales. Unfortunately, we are only able to consider queries relating to the law of England and Wales.

Kind regards

Jacob Walker

By Hannah on July 6th, 2016

I run a small retail business within a shopping centre so I pay a service charge every quarter usually amounting to a little over £400. A year ago I received a Credit Note for £90 with a letter which said any credit/debit notes received are to be used against my next service charge, which I used. 8-10 months later they are demanding the amount I deducted from that payment claiming that they had ‘printed it on the wrong paper’ and that it was actually supposed to be a debit note. The words ‘CREDIT NOTE’ were printed on the paper, but the letters ‘DR’ have been put after the amount. Am I obligated to pay this?

By Vaibhav Avhad on July 6th, 2016

Hello,

I’m planning to buy business which is at rented property and agreement is until 2018. What would happen if my landlord decide not to renew my lease? can he run same business on same place?

By Laura Brereton on July 7th, 2016

Dear Vaibhav,

Thank you for your query. It is difficult to advise without first seeing a copy of the lease. The lease may have provisions which prevent the current tenant from assigning the lease to you, and the contents of the lease may also have implications for the future of your business. I would strongly recommend that you have the lease reviewed by a solicitor before proceeding. Please do not hesitate to contact me if you would like me to assist with reviewing the lease on your behalf.

Kind regards,

Laura Brereton

By Mary on July 8th, 2016

I am 14 days late with my rent. I paid 1/3 of it but my landlord said he will send in the bailiff. Can he do this?

By Khabi Mirza on July 8th, 2016

I recently moved my PR showroom to a new location. Having come to the end of my previous tenancy agreement (sub-let) with a private landlord I requested my £16.5k deposit (which we had been verbally told would be held in an Escrow account) , only to be told today that the property management company has gone into liquidation.
As my business was the sole tenant of this landlord, it appears that the owner has unscrupulously decided to pocket my deposit.
I would greatly appreciate any advice you can give me on my legal recourse to get back my sizeable deposit.
Also, perhaps worth noting that the landlord in question also runs a separate recruitment business which is still operating.
Many thanks for your help,
Khabi Mirza

By Taylor on July 8th, 2016

We took on a ground floor retail tenancy in 2015. There was another retail premises above us. In 2016 the landlord converted the 1st floor to a residential flat. There are only carpeted floor boards between us and the flat above. We have open rafters as we are an art gallery (its trendy 😉 I did ask about fire separation when we took the lease on but was told commercial premises doesn’t require it? Now on our busy Saturday the whole gallery is filled with obnoxious overpowering food smells from above. We have customers walking out. We have informed the landlord and the best he could offer was for us to put lemons out to absorb the smell. He says he asked the tenants and they said they dont cook on a Saturday and they always use the extractor when they do. He has just accepted that and said there is nothing he can do. We have already had to put up with excessive noise 5 days a week for 5 months whilst they converted it, drilling and banging. Plus he did all this without planning permission or building control. He has now turned very aggressive to me as i wont let it go. Any advice. thanks

By Matthew Astley on July 11th, 2016

Dear Mary

Thank you for your enquiry.

Given the subject matter of the blog on which you have commented I will respond on the assumption that your enquiry relates to a commercial lease.

In order to provide you with full advice, tailored to you and your particular situation, we would need to have sight of your lease and obtain further details from you.

There is a legal procedure available to commercial landlords relating to the recovery of rent arrears. This procedure for commercial rent arrears recovery (“CRAR”) is set out in the Tribunals Court and Enforcement Act 2007. It allows a landlord to instruct what is known as an “enforcement agent” to take control of the tenant’s goods and sell them in order to recover an equivalent value to the rent arrears. For the purposes of CRAR, rent is the amount payable under the lease for possession and use of the premises and excludes sums towards council tax, repairs, maintenance and so forth.

Only an enforcement agent can exercise CRAR on behalf of a landlord. CRAR is similar to a previous method of enforcement known as “distress”, but there are some important differences. A certified bailiff is used to carry out distress, although in practice there appears to be little difference between an enforcement agent and a landlord.

CRAR applies to all tenancies of commercial premises that are in writing. Before CRAR can be exercised the following conditions must be satisfied: the tenant must be in arrears before notice of enforcement is given; the amount of arrears must be certain or capable of being calculated with certainty; the “net unpaid rent” must equal or exceed an amount equal to seven days rent; and the tenant must be in arrears of the net unpaid rent when control of the goods is taken. Furthermore, before CRAR can take place various notices, which must include certain information, have to be served at each stage of the process.

If a commercial landlord uses CRAR it has potentially important consequences for additional rights that the landlord may ordinarily have. For example, if CRAR is used, any right to “forfeiture” will be waived. Forfeiture is a method by which a business tenancy that meets certain criteria can be terminated. It is possible for a landlord to “forfeit” a business lease either by peaceable re-entry or by going to court to bring forfeiture proceedings against the tenant. Therefore, a prudent landlord will not use CRAR without careful consideration.

The above gives you a very basic outline of CRAR. However, as mentioned, in order to give you full advice we would need to have sight of your lease and obtain further details from you about the particular circumstances of your enquiry. To receive tailored advice please feel free to either contact me, on 01772 429209 or at matthew.astley@harrison-drury.com , or a member of our Commercial Property team, in order to discuss your query in further detail.

Kind regards

Matthew Astley

By John Smith on July 11th, 2016

I recently rented out a building to a company on a Licence, rather than a Lease, due to restrictions of sole use on the building. The tenant got into financial difficulty and was given 3 months to vacate per the terms of the licence. They have now left, owing a considerable amount of rent and leaving a lot of play equipment behind (the business was a nursery. Would I be entitled to sell the equipment to recover some of the rent owed, can I bin it or do I have to store it for any future liquidators (the company is now insolvent. Thanks John

By kevin on July 11th, 2016

have sale commercial property lease granted in 1995 with further option to renew for further 3 years on title. I bought 10 years ago vacant possession tenants or successors not there no rent paid can I sell as is and new owner take free of this

By Laura Brereton on July 12th, 2016

Dear Kevin,

I am not quite sure what the position is from reading your query but my understanding is that you purchased the freehold of a commercial property ten years ago. At some point the property was tenanted but from what you say it seems that this is no longer the case.

If you want to sell the property soon it will be easier if the notice relating to the lease is removed from the title first and, depending on the circumstances, this can be relatively simple to do. Please contact a member of our commercial property team on 01772 258321 if you would like us to give you a quote for the work and discuss your requirements further.

Kind regards,

Laura

By Adrian Miles on July 12th, 2016

Hi my partner agreed to purchase a business which I provided funds for. It was agreed the existing lease would be transferred like for like into her name. However when the new draft lease was issued it was a full repairing lease completely different from the original. Whilst my partner has been given access to run her business in the property by sub letting from the tenant and she has agreed to pay all bills rent etc. However the building is in disrepair and the landlord will not agree to repairs unless my partner signs a new full repairing and insuring lease. My partner has decided not to pay rent until the building is put in good order but the tenant has now threatened her with section 146 if the rent is not paid. Is the tenant able to do this bearing in mind there is no written contract/agreement and my partner was given false information when agreeing to purchase the business. To date nothing has been signed and no payment has been made to purchase the business from the tenant.

By Morag on July 14th, 2016

Hello, I sold my business last year, I remained on the lease which has an AGA attached to it. My buyer has now defaulted on the rent and stopped operating the business and the landlord’s solicitor is threatening court action which involves me also under the AGA. The buyer and one witness claims the landlord told her that she doesn’t need to pay the rent as he will just get the money from me. He has said the same thing to me in the past when we discussed my selling the business. Ie. I don’t need to worry about the tenant defaulting as I will get the rent from you. In my view this is encouraging my buyer not to pay the rent to him. Please where do I stand on this? Thank you M

By DAVID on July 18th, 2016

I have a tenant who is on a 15 year FRI lease, last month he paid his rent via a newly constructed limited company. On the company he is down with his wife as directors.
I refused to accept the rent as paid and informed him that it is he and his wife who have the lease and not a limited company, I then informed them that I would place the monies into a separate account until I hear from him. To date I have heard nothing. What is the next step? Thank you

By Amanda on July 18th, 2016

I am a leaseholder with no contract for 8 years. Each time I ask for one Landlord ignores me. I have faced rent increase over the years. Landlord wanted to build luxury flat and he lost the case. He has now issued me with a Notice to Quit January 2017. What can I do?

By Carole on July 19th, 2016

Hello

We run a small company bottling Dartmoor Water. We have a two year lease for the land our bottling shed is on and the borehole and pump etc. Our Landlady is threatening to shut us down and bulldoze the whole site as she is fed up with us. (we are only trying to improve broadband into our office, and asked BT to see what if anything they could do!). Rent and bills are always paid on time and we are building up a good reputation in the area. We are wondering if its worth continuing with our venture if she is able to just come in and shut us down?! We were hoping to get further rounds but we only have 1 and half years left on the lease? My other concern is that due to her erratic behavour and is elderly where do we stand if she is in the first stages of Alzheimers, with no close family?

I would just like to know what we can do to ensure we arent just kicked out.

Any help or guidance would be so appreciated.

Waiting in anticipation for a reply.

Carole

By Brad on July 20th, 2016

hi iam leasing a social club i’ve been getting a bill stating quarterly ground rent and insurance every month!!! should i be paying these….

By Kerry Southworth on July 22nd, 2016

Dear Liz

Many thanks for your comment. Unfortunately I am unable to provide you with clear advice until I see the terms of your current lease. The law surrounding repair obligations is fairly precise in terms of what needs to be in the lease to triggers the obligations.

It may be that you have recourse to your landlord for failing to comply with the terms of the lease, and potentially for negligence if this failure has caused you or your tenants any harm.

If you would like to send us a copy of your lease, and any correspondence with your landlord regarding the leak, I will arrange for a member of our property litigation to contact you.

Kind Regards,
Kerry
kerry.southworth@harrison-drury.com

By Jack Stephenson on July 22nd, 2016

Dear Brad

Thank you for your query.

Unfortunately I will need to see a copy of your lease before I am able to advise you further.

Please do not hesitate to contact me on 01772 429 207 or jack.stephenson@harrison-drury.com.

Kind Regards

Jack Stephenson

By Matthew Astley on July 22nd, 2016

Dear Carole

Thank you for your enquiry, which it appears relates to a business tenancy.

In order to provide you with full, tailored advice, we would need to obtain further details from you and have sight of your lease. Nevertheless, we are able to provide you with the following, general information.

Business tenancies that meet certain criteria are protected by the Landlord and Tenant Act 1954 (“LTA 1954”). The LTA 1954 allows termination of a protected lease by different methods. In some cases, landlords and tenants agree to exclude the provisions of the LTA 1954 at the time the lease is entered into. This is the reason that it is important that we see your lease as to advise you we would need to determine whether the LTA 1954 has been excluded or not.

In general terms, a protected lease will not terminate automatically at the end of the contractual term. Instead, if certain criteria are met, it will continue until terminated in a specified way. However, there are various ways to terminate a protected tenancy. In relation to termination by a landlord, as opposed to by the tenant, these include termination by notice under the LTA 1954 and termination by something called forfeiture if the tenant has breached the lease.

In order to terminate by notice under the LTA 1954, a landlord must give notice of not more than 12 months nor less than 6 months before the termination date specified in the notice. Notice can be served before the end of the contractual term or afterwards if the tenancy continues. In some cases a lease may contain a contractual break notice or option. If this is the case then the notice period mentioned still applies. In addition, the termination date specified in the notice cannot be earlier than the break notice given under the lease.

In some circumstances the landlord is also able to terminate a protected tenancy by forfeiture, meaning that the landlord is able to “forfeit” the tenancy by “peaceable re-entry”. The ability of the landlord to do this depends on whether the tenant has breached a condition or covenant of the lease.

Before being able to fully and properly advise you on how the law on terminating a protected business tenancy applies to your particular circumstances, we would need to review your lease. We would also need to obtain further information from you, in the context of our consideration of your lease, about the surrounding circumstances of your case, including for example about your attempts to try and improve the broadband into your office.

To receive tailored advice please feel free to either contact me, on 01772 429209 or at matthew.astley@harrison-drury.com , or a member of our Commercial Property team, in order to discuss your query in further detail.

Kind regards

Matthew Astley

By Chris Hinsley on July 25th, 2016

Hello, I appreciate that you would need to see the contract to offer further advice so I will keep this general and hope that you can offer me some general advice. My wife owns a Beauty salon and rents 2 rooms of a local leisure centre to operate from. In her contract it states that she is to pay £14400 a year excluding VAT. The business is doing well and both parties are happy with the arrangement. However she has recently had a rent review and they noticed that they had only been charging her £14400 a year including VAT. She has checked her invoices and it states that she has been paying £1000 for the rent plus £200 VAT. So it appears that they have simply made an error on their part with how much they have been charging. They are now asking for £20160 a year for the next two year contract period to repay the £200 a month that they mistakenly had not charged her for the last two years plus the extra £200 at the new rate. This amounts to a 40% increase in rates. My question therefore is does she legally owe them this money considering she signed the contract but they miss charged her and would it matter if she simply decided not to renew the contract as it is unlikely she would be still able to make a profit at the new rates.
Kind Regards Chris

By Mari on July 26th, 2016

Hello, We have signed a lease for a premises which were in very bad state when took over, we did all repairs etc and in the contract it says to keep them “in repair” but doesn’t specify anything else than we need to decorate in the last three months. My questions is what “in repair” means in that case and because the building is old the roof is leaking a lot whose responsibility is it to solve the problem? (I have to say that this isn’t fully repairing and insuring lease) Before we signed the lease we’ve been told by the landlord that it was sorted but obviously we have been misled as it still leaks (heavily on some places) two years later. No clause in the lease says who is responsible for the repair of the roof or in fact for anything else.

And one more question, landlord bills us for electricity, water rates and building insurance but never provide (and even avoids to provide) actual bills and how are our bills have been calculated.
For the insurance lease says that fair proportion should be paid but I have no idea how fair is it when I never saw the policy or premium.
For the other bills lease says only that “tenant needs to pay all costs in connection with the supply and removal of electricity, gas, water, sewage, telecommunications and data and other services and utilities to or from the property”. Shouldn’t he at least show the bills and tell how does calculates our charges or should we just pay what he says we should?
Kind Regards
Mari

By Sharon on July 26th, 2016

I (tenant) want to terminate by business lease with the Landlord,but there is no break-clause in the Lease. Following a fire at the premises (the whole building is closed down due to a car running into the building) I have not been able to use/trade from the premises since the begining of July and it is unlikely that the building can be in a condition to be used for another 6-12months so I have had to move my business to another premise. Is there anything I can do to terminate the lease apart from negotiate with the Landlord as he is unwilling to terminate it.
Further I believe I have been paying him over £8,000/month over the normal market rate for the premises over the past 10 years, would I be able to challenge him on past rent?: should I go to the rent tribunal?

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