This cheatsheet includes practical tips to understand key clauses and avoid disputes in leasing agreements.<\/p>\n <\/div>\n \n\nDownload Now<\/a> <\/section>\n <\/div>\n\n\n\n\n A protected lease<\/a> is a lease with security of tenure. This is a legal protection found in the Landlord and Tenant Act 1954. It protects a commercial tenant when the lease reaches the end term date, allowing the lease to renew on the same terms automatically.\u00a0<\/p>\n\n\n\n Your lease agreement will state whether you have a protected lease or not.\u00a0 If not, it will specify when your lease term ends and your renewal options.\u00a0 Notably, it is not an automatic right in a non-protected lease.<\/p>\n<\/div>\n\n\n\n Whilst a protected lease offers the legal automatic right to lease renewal, a landlord has limited legal grounds to refuse this. There are also legal procedures associated with protected leases, which the landlord and tenant must follow. Accordingly, a court can play a role in a protected lease.\u00a0<\/p>\n\n\n\n Where you have a protected lease, a court can play a role when parties disagree on any new lease provisions or if a landlord refuses to renew.<\/p>\n\n\n\n When a protected lease automatically renews, there is an opportunity for either the commercial landlord or tenant to negotiate different lease terms. The best way to do this is through informal negotiations<\/a>. Alternatively, parties to a lease can present the other with a notice which details the suggested terms. If a landlord does this, they use a Section 25 Notice, and a tenant will use a Section 26 Notice. Where parties cannot agree to new terms, either can apply to a court to decide the new lease terms.\u00a0<\/p>\n\n\n\n A court will consider the reasonableness of the new terms and whether they are enforceable.\u00a0 Courts can grant a term of up to 15 years on a new lease.<\/p>\n<\/div>\n\n\n\n A court can also decide the rent amount of the new lease at lease renewal. This should reflect the market value of the property. When the court chooses the rental amount, there are specific factors they cannot take into account, such as:<\/p>\n\n\n\n The court will also decide other lease terms by:<\/p>\n\n\n\n When considering the other terms of the commercial lease, a court can decide to add a rent review clause<\/a> to the new lease. <\/p>\n\n\n\n If a landlord wants to refuse automatic commercial lease renewal, they have seven potential legal grounds. Some of these grounds allow a court to play a role, as follows:<\/p>\n\n\n\n If the court decides the lease renewal should proceed, it will order a new lease with terms. Notably, parties to the lease can agree to their own terms. If the tenant decides not to stay in the property, they can ask the court to revoke the new lease. However, the court has the power to extend the current lease in these circumstances and may do so for a period to allow the landlord to find a new tenant.<\/p>\n\n\n\n\n\n Continue reading this article below the form\n <\/i>\n<\/a>\nWhat is a Protected Lease?<\/h2>\n\n\n\n
Court\u2019s Role in a Protected Lease<\/h2>\n\n\n\n
Deciding on Lease Terms<\/h3>\n\n\n\n
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Hearing a Lease Refusal<\/h3>\n\n\n\n
Ground B<\/td> This ground is where a landlord refuses renewal based on regular late rent payments. When a landlord relies on this ground, the court ultimately decides whether to order a new lease. The court will primarily look at the likelihood of prompt rent payments in the future.<\/td><\/tr> Ground C<\/td> A landlord will advance Ground C where a tenant is in breach of the lease. When deciding whether to order a new lease, the court will consider the following:
+ breach circumstances;
+ the tenant’s conduct during the lease; and
+ if there has been a breach of the lease by the landlord, which denied the tenant a right they should have enjoyed.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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\n Cheatsheet for UK Leasing Terms<\/div>\n
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