Update on the Law Commission’s review of the Landlord and Tenant Act 1954

Ros Monk, partner in our land and property dispute resolution team, considers the ongoing review of the Landlord and Tenant Act 1954 and whether the legislation still meets the needs of today’s commercial leasehold market.

The Act

The Landlord and Tenant Act 1954 (the “Act”) came into force over 70 years ago and was last reformed in 2003. Whilst it is one of the key pieces of legislation affecting commercial leases, it is frequently criticised for being bureaucratic, out of date, and inflexible.

The Act was brought into force with the aims of helping the economy by giving commercial occupiers security of tenure and stability, enabling them to focus on their business.

However, the world in 2025 is very different to that of 1954, as are the legal documents and the operation of the commercial leasehold market.

Recently, factors such as government lockdowns and the ever-increasing significance of environmental and energy concerns have highlighted the need for lease terms to change and evolve, something that can be difficult in the context of a renewal of a protected tenancy.

In addition, the significant pressures faced in the County Court can make the Court process difficult and protracted, even in the most straightforward of matters.

Reform of the Act has long been discussed, and in March 2023 the Law Commission announced that it would review the Act.

Review

After several missed deadlines, the 108-page long the initial Consultation Paper was eventually published on 19 November 2024.

This is the first part in a two-part review of the Act. The first step is to conduct a wholesale review of the purpose of the Act. As part of this, the Law Commission is considering which of the four different models to adopt:

1. Mandatory statutory security of tenure.
2. No security of tenure i.e. abolishing the Act.
3. A contracting-in regime.
4. A contracting out regime i.e. preserving the status quo.

The Paper discusses each of the models in detail and sets out the arguments for and against each model. The Law Commission considered whether a new model should apply to all types of tenancies, for example, should a certain size of property or a certain type of commercial use, be excluded.

The Law Commission stated that it is open-minded and does not favour any particular model. It also stated that it was keen to gather as much evidence as possible in its review.

Additionally, the Paper attached a survey that it asked landlord, tenants, and professional advisors to complete.

The Survey

One of the points flagged in the first Consultation Paper is there is little data as to how many tenancies are protected by the Act.

The first part of the Survey sought information from the respondents on the respondents themselves and their property experience.

The Survey asked for information on the respondents, being:

• Whether they are a landlord, a tenant or a professional advisor.
• The size of their business.
• The type of business the tenant operates from the property.
• How many tenancies they hold and the proportion that are protected by the act.
• Where in England and Wales those tenancies are located.
• The length of the tenancies.
• The impact of the act on rent.
• The costs and timescale of the process of renewal or opposition.

The Survey then asked for the views of the respondents on reform, specifically:

• Their experiences relevant to considering potential reform of the Act.
• Which of the four models are preferred and why.
• The impact that changes to the Act will make to them and to the wider market.
• Their views on the potential benefits and disadvantages of reform.

The survey closed on 19 February 2025.

The Law Commission’s provisional statement

The Law Commission has reviewed the responses to the survey and is currently considering whether the Act should be reformed.

In the meantime, they have issued their provisional statement on the consultation.  After reviewing over 160 responses, it concludes that:

• The existing ‘contracting out’ model is the right model, and this strikes the right balance between landlord and tenant interests.
• The types of tenancy that are already excluded from the 1954 Act should stay excluded (for e.g. Agricultural tenancies).
• The six-month threshold for obtaining 1954 Act protection should be increased.

The Commission will consult on whether to increase the threshold to two years. So, what’s next?

Conclusion

These conclusions will form part of a second consultation paper, which will be published in due course.

We already know the second consultation paper will focus on the processes and practicalities of the operation of security of tenure.

Our land & property dispute resolution team will let you know when the second paper is published so you can have your say. We hope that this time, given the significance of any reform, there will be more than 160 responses.

 If you would like to speak with one of our lawyers, please contact our land & property dispute resolution team on 01772 258321.