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Notices and Letters for Tenants and Licensees of Business Premises

January 2014
Most businesses operate from premises occupied under a lease or licence. The landlord-tenant relationship (or licensor-licensee relationship) works best when there is a good line of communication between the parties.

Often the communication can be informal – a phone call or email about a minor repair issue or a day to day practical matter – but sometimes things need to be done more formally. Our Property portfolio is not just for landlords and this month we have added a selection of documents to meet the needs of occupiers.

Alterations, Assignment and Underletting

If a tenant is planning to carry out alterations, assign (or sell) the lease or grant an underlease, the landlord’s consent needs to be sought and properly documented. If the tenant proceeds without consent, it will be in breach of the lease and the landlord may take action against the tenant.

A tenant in breach of a lease might face a claim for damages (to compensate the landlord for any financial loss) or an injunction (to “undo” the unauthorised activity) or the landlord might forfeit the lease (terminate it early). At the very least, a previously good landlord-tenant relationship is likely to deteriorate.

Our new Tenant’s Request for Consent Letters help tenants to approach alterations, assignments and underlettings in a structured and formal way. The template letters prompt tenants to include all relevant information about the proposed activity so that the landlord can make a decision without delay.

Tenants proposing to grant an underlease will find our new Underlease Heads of Terms useful. There are versions for an underlease of whole and an underlease of part of the tenant’s premises.

Lease Renewal and Termination

A tenant with security of tenure (essentially all business tenants whose leases do not exclude the security of tenure provisions of the Landlord and Tenant Act 1954) is entitled to remain in occupation of the premises at the end of the term of the lease and to request the grant of a new lease. This is done using the Section 26 Request. Our template is in the prescribed statutory form.

If an occupier wishes to terminate a tenancy at will or a licence to occupy, the procedures set out in the tenancy at will or licence document must be followed. If they are not followed the tenancy at will or licence will continue and the occupier will remain liable to pay rent and to perform all its other obligations. Our new Tenant’s Letter Terminating a Tenancy at Will and Licensee’s Letter Terminating a Licence to Occupy can be used to bring these arrangements to an end.

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.

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