Application for security of tenure

Question 1

What are the requirements to have security of tenure?

Answer 1

Any tenancy occupied by the tenant for the purposes of business.

Question 2

In relation to `any tenancy’, what arrangements are and are not included in this?

Answer 2

Included in the definition:
*Fixed term tenancy
*Periodic tenancy

Not included in the definition:
*A licence
*A tenancy at will

Question 3

When will a tenancy not be `occupied by the tenant’?

Answer 3

If the tenant leaves the premises vacant, then it is not entitled to claim security of tenure.

NOTE, if the tenant underlets the whole or part of the premises, then it follows that it cannot be in occupation and will lose security over the whole or part of the premises accordingly.

Question 4

What does `for the purposes of business’ mean?

Answer 4

This means any “trade, profession or employment”.

Question 5

What are examples of business purposes?

Answer 5

*A charity shop

*A tennis club for members only

*residential use that furthers the tenant’s business e.g. accommodation for medical school students or a lease of a shop, part of which could be used for residential purposes.

Question 6

What are examples of non-business purposes?

Answer 6

*Sunday school sessions provided free of charge by an individual

*A tenant of a house taking a small number of lodgers without profit.

Question 7

What are excluded tenancies?

Answer 7

*Agricultural tenancies

*Mining leases

*Service tenancies (a lease granted as part of a tenant’s employment e.g. security guards flat)

*Fixed term tenancies of six months or less (but can become protected if the tenant has been in occupation for 12 months or more, whether through successive tenancies or if the tenancy is renewable beyond six months).

Question 8

What does `contracting out’ mean?

Answer 8

LTA 1954 allows parties to agree to exclude a fixed term lease from the security of tenure provision.

Question 9

What sort of tenancy does the contracting out provisions apply to?

Answer 9

Fixed term tenancies ONLY i.e. not periodic tenancies.

Question 10

Why would a landlord not want to contract out?

Answer 10

Offering protected tenancies may encourage long term tenants, and not doing so may limit the premises appeal.

Question 11

What tenancies are normally contracted out?

Answer 11

*short term leases (5 years or less)

*underleases (usually required by the tenant’s lease).

Question 12

What is the two-stage procedure for contracting out?

Answer 12

1. The landlord must serve a warning notice on the tenant in the prescribed form.
2. The tenant must provide a declaration in prescribed form to the landlord before completing the lease.

Question 13

What process did the LTA 1954 used to use for contracting out?

Answer 13

The LTA 1954 used to require a court order to be obtained to any contracted out tenancy.

From 2004 this changed.

Question 14

What must the warning notice contain and when must it be served?

Answer 14

This details the consequences of contracting out the security of tenure provisions.

It must be served before the parties complete the lease.

Question 15

What form must the declaration take?

Answer 15

If lease completion is at least 14 days from the date of the warning notice, this can be a simple signed declaration.

If the lease completion is less than 14 days away, then the tenant must provide a statutory declaration (declared before an independent solicitor).

Question 16

What must the lease contain in relation to contracting out?

Answer 16

The lease must contain reference to both the notice and declaration of contracting out.

If the procedure is not correctly carried out, or not correctly referred to in the lease, the likelihood is that the lease will enjoy security of tenure.