Giving and Withholding Consent to Alterations
We have expanded our range of documents to help landlords and tenants make and respond to applications to carry out alterations to commercial premises. Our new and amended documents are designed to comply with the new Protocol for Applications for Consent to Carry Out Alterations (also called the Alterations Protocol).
What is the Alterations Protocol?
The Alterations Protocol can be found at http://www.propertyprotocols.co.uk. It aims to standardise how commercial landlords and tenants in England and Wales approach applications for consent to make alterations. It is a “best practice” guide that is widely supported in the property sector.
Is the landlord’s consent required for alterations to leasehold premises?
Most business leases include a clause setting out the extent to which a tenant is permitted to make alterations to the demised premises. The lease may absolutely prohibit alterations or may (unusually) give the tenant an unfettered right to make alterations. More usually, the lease will contain a qualified prohibition on the making of alterations.
A typical lease clause will provide that the tenant may make certain types of alterations (usually internal, non-structural alterations) subject to obtaining the landlord’s consent. There is usually a proviso that the landlord’s consent must not be unreasonably withheld.
How does the consent process work?
The first stage of the process is for the tenant to apply for the landlord’s consent to the proposed alterations. The tenant’s application should be in writing and should contain all the information necessary for the landlord to make a decision. This is likely to include plans, drawings and/or specifications showing the proposed works.
The landlord will then decide whether or not to consent to the proposed alterations. As noted above, the landlord generally may only withhold consent if it is reasonable to do so. The landlord may give consent subject to reasonable conditions. What is reasonable will depend on the circumstances but the landlord is entitled to consider the effect of the alterations on the landlord’s investment as well as other factors such as safety and aesthetics.
If the landlord is willing to give consent, it will confirm this to the tenant. The consent will be formally documented in a Licence to Alter.
We have updated our Tenant’s Request for Consent template and our Heads of Terms template. We have also added new letters for landlords to use to acknowledge applications for consent, request further information and notify the tenant of the landlord’s decision to give or withhold consent.
The contents of this Newsletter are for reference purposes only and do not constitute legal advice. Independent legal advice should be sought in relation to any specific legal matter.