Lease Renewals Flashcards
What does section 23 of the L&T Act state in relation to the 6 key factors for a lease to gain protection within the act?
- It is a tenancy.
- The premises must be used for business.
- There must be occupation of at least part of the premises by the tenant.
- There must be occupancy of more than 6 months.
- It must not be an exempted or excluded tenancy e.g. tenancy at will.
- Must be a competent landlord.
What does section 24 of the act refer to?
Effluxion of time - a tenancy does not expire by effluxion of time - but only when one party serves a notice.
Holding over - when no notice is served tenant holds over until either party serve a notice.
What is a section 25?
Landlords notice to end a tenancy – can be hostile or friendly.
What are the timing provisions of a section 25?
Not more than 12 months or less than 6 months before the date of the termination specified.
What are the requirements of a section 25?
- Be given by a competent landlord and tenant – must be a freeholder or leaseholder
- Relate to the whole property comprised in the tenancy
- State the date for the termination of a tenancy
- Be in the prescribed form and state the tenants’ rights
- Friendly – state terms of new lease
- Hostile – set out grounds for opposition
- Parties can extend time limits by agreement
- Maximum of 15 years can be granted by the court
What is included within a section 25?
- Name and address of LL and tenant
- Address of property
- Notice to end tenancy – hostile or friendly
- Confirmation date of response required
- New terms or grounds of opposition
- Recommended to seek professional advice
- Subject to contract and without prejudice
What is a section 26?
- Tenants notice requesting a new tenancy – Not more than 12 months or less than 6 months before the stated termination date.
- Must be in the prescribed form and state the tenant’s proposals for a new lease to include the proposed rent.
What is a section 27?
Notice to be served by the tenant anytime if he wants to leave within 3 months after the lease expires.
Who serves a S25/26?
I would advise the client but the lawyers would serve them – important to check that the notice is valid and in the required form, in accordance with the Act, upon the correctly named party.
What is the process of a lease renewal inside the act?
- Lease renewals are governed by the landlord and tenant act
- A landlord can serve a friendly or hostile section 25 notice. A tenant can serve section 26 notice to renew the lease or a section 27 notice to terminate a tenancy.
- Section 25: must be served within a minimum 6-month notice and max 12 months’ notice (can be served at any time but not before 12 months of expiry)
- Section 26: must be served within a minimum 6-month notice and max 12 months’ notice (can be served at any time but not before 12 months of expiry)
- Section 27 notice: Can be served at any time but with a minimum 3 months’ notice.
Strict timescales for a tenant to respond to landlord have been removed since June 2004. Both parties can apply to court to delay or speed renewals up.
- Agreement under section 28: L&T agree a new tenancy.
What section relates to the SEVEN grounds for repossession and what are they?
Section 30
a. T failed to carry out repairs
b. T delayed rent
c. T in breach of other covenant
d. LL offers suitable alternative accommodation
e. If the building would produce a higher rent either as a whole or multi-let (compensation)
f. LL intends to redevelop (compensation)
g. LL intends to occupy for own purposes (must have been the landlord for a least 5 years).
Under section 37 what are the levels of compensation?
- Tenant receives compensation 2 x RV if occupied > 14 years.
- Tenant receives compensation 1 x RV if occupied < 14 years.
RV is the RV in force as at the date of a hostile s.25 or s.26 counter notice.
What are the requirements for section 30 f?
Landlord must prove firm intention, prove funding and planning, substantial work & necessity to gain vacant possession – AS OF 2019 – CAVENDISH V FRANCES – NOW MUST HAVE A BUILDING CONTRACT IN PLACE.
What are the requirements for section 30 g?
Landlord must have owned the property for 5 years and prove intention to occupy or run business.
What recent case law refers to section 30 f?
- S Frances v The Cavendish Hotel (2017)
- Court held that a landlord is entitled to refuse a new business tenancy on redevelopment grounds even when redevelopment is devised specifically to evict the tenant and confers no other benefit to the landlord – However, the Supreme Court allowed the appeal in December 2018; The landlord has to prove a firm and settled intention to carry out the works.
