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Being party to a commercial lease is not only about the actions that occur once you enter the agreement, such as carrying out the lease obligations. It is also essential to be aware of actions that occur before and as you enter a commercial lease agreement. One area of critical importance is when a person describes the property for lease during the advertising stage. It is crucial to avoid unfair commercial practices, such as misleading and deceptive conduct. This article will help explain what is meant by misleading and deceptive conduct concerning a commercial lease in England.
What is Unlawful Conduct?
When a commercial property owner asks an estate agent or letting agent to advertise their commercial property for lease, there are rules regarding advertising practices.
Consumer Protection from Unfair Trading Regulations
The Consumer Protection from Unfair Trading Regulations 2008 (CPRs) contains rules on how estate agents and letting agents describe commercial property in England during advertising, such as when it is available for a lease. It is a criminal offence for a person to carry out misleading actions or omissions that are likely to persuade a person to conduct a transaction.
In terms of a ‘misleading omission,’ this means a failure to give important or material information, which affects whether the other person makes a transactional decision, such as entering the lease agreement.
What This Means for Commercial Leases
The CPRs affect commercial leases when a commercial property is being described to a business owner with the intention to lease it to them as their commercial premises. Real estate agents must ensure they do not mislead or are deceptive when describing the commercial property. For example, they must not make misleading statements about the following:
- the property’s location;
- the environment of the property;
- use of photos;
- measurements of the property’s demise; and
- pricing.
English law is relevant to a verbal conversation about the commercial property as well as written information about it.
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What This Means for You
Whilst you may not be a letting agent or estate agent, as a commercial landlord or potential commercial tenant, you must be aware of this law. As a commercial landlord, you may privately advertise your lease, so misleading and deceptive conduct laws will apply. Where you do not, you may still be present when a business owner views your commercial property, and if so, you need to be aware of what you say about it.
Alternatively, if you are a business owner looking for a commercial property, knowing how the law protects you when deciding upon your property transaction is crucial. Entering a commercial lease is a significant commitment for a business owner. It means you sign a commercial lease agreement, which is a binding contract. You want to ensure you pay for what you thought your lease entails.
This cheat sheet outlines what you should be aware of in your lease agreement.
Key Takeaways
Misleading and deceptive conduct when advertising a commercial property can entice a business owner to enter a lease agreement under false or misleading pretences. The Consumer Protection from Unfair Trading Regulations 2008 prohibits misleading actions and omissions when describing a property for lease.
For more information on how misleading and deceptive conduct applies to your commercial lease, our experienced leasing lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.
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