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Renewal or Termination of Leases

RENEWING OR TERMINATING YOUR LEASE – COMMERCIAL

Under Part II of the Landlord and Tenant Act 1954 (The Act), a tenant occupying business premises generally has the right to renew its lease when the lease comes to an end. The landlord can only object to the renewal on certain legal grounds.

Renewals of business leases are governed by the Landlord and Tenant Act 1954, specifically Sections 24 to 28.  These sections provide a framework for the giving and receiving of notices to either renew a business lease or, where it is appropriate, to bring that lease to an end.  The Act allows either landlord or tenant to serve a notice to call for a renewal.  Ultimately, the procedure allows one or other party (or both) to make an application to the Court to settle what is to happen.

Any business lease that has the protection of the Landlord and Tenant Act 1954 incorporated into it will not automatically end on the expiration of the lease. It can potentially run on indefinitely until one of the four trigger points occur with rent still being paid at the same rate as was paid during the lease term.

However, the parties to a lease can agree before it is granted to exclude it from the protection of the 1954 Act, in which case the tenant will have no automatic right to insist on a new lease at the end of the term and can only remain in occupation with the landlord’s agreement. Whether the Act is excluded or not will usually be made clear from the Agents Heads of Terms. An alternative way is for the landlord to serve a notice on the tenant that he wishes to exclude the 1954 Act from the lease and will need the tenant to acknowledge receipt by signing a declaration. This should be done 14 days before the lease is due to expire.

If you are a landlord or a tenant renewing your lease or facing the end of a lease term, then Leon Kaye Solicitors can offer expert legal advice on commercial property law. We are fully accredited members of The Law Society’s Conveyancing Quality Scheme.  Please contact us at info@leonkaye.co.uk, or use our on line enquiry form below.

Leon Kaye Solicitors, London (Chelsea Office) 020 7228 2020 (Knightsbrige Office) 020 7095 0930