PLP - Business tenancies

Question 1

What are excluded tenancies?

Answer 1

• Agricultural tenancies
• Mining leases
• Service tenancies (e.g. security guard’s flat)
• Fixed term tenancies of six months or less – but can become protected if the tenant has been in occupation for twelve months or more

Question 2

What is contracting out?

Answer 2

Parties agree to exclude a fixed term lease from the security of tenure provisions

Question 3

What is security of tenure?

Answer 3

tenant can continue to occupy the premises at the end of the contractual term. Landlord’s ability to recover the premises from the tenant is limited.

Question 4

What is stage one of contracting out - post June 2004?

Answer 4

Landlord must serve a warning notice on tenant in a prescribed form, before the parties complete the lease. This details the consequences of contracting out the security of tenure provisions.

Question 5

What is stage two of contracting out - post June 2004?

Answer 5

If lease completion ≥ 14 days from date of warning notice, it can be a signed declaration

If lease completion < 14 days from date of warning notice, tenant must provide a statutory declaration declared before an independent solicitor.

The lease must contain reference to both the notice and declaration – if it doesn’t, or its not correctly carried out, contracting out will fail –> lease enjoys security of tenure

Question 6

What is surrender?

Answer 6

this is when the tenant gives up its leasehold interest to the landlord, bringing it to an end

Question 7

What happens if a tenant vacates at the end of the contractual term

Answer 7

Tenancy ends on that date regardless of its protection statuts

Question 8

What is the difference between a friendly s 25 notice and a hostile one?

Answer 8

A friendly section 25 notice indicates that the landlord is willing to renew the lease; a hostile section 25 notice that the landlord intends to oppose renewal.

Question 9

When the major supermarket chains take a protected lease of premises (eg, for local supermarket branches), they may make it a condition of the lease that the landlord does not assign the reversion of the lease to a rival supermarket chain.

Why is this?

Answer 9

Because if the rival supermarket becomes the landlord, then after five years of holding the reversion, they may oppose renewal on the basis of occupying the premises for their own use.