3 November 2023 by Ransford Addo-Quaye

Landlord objections to renewal of business tenancies

The Landlord and Tenant Act 1954 (‘the Act’) enables a landlord to oppose the renewal of business tenancies in certain circumstances.

One of these circumstances is where the landlord can prove a breach of the tenant’s repairing obligation. The Act does not specify a relevant date for the tenant’s disrepair, and the court has historically accepted this date as being the date the landlord serves a certain type of notice on the tenant. However, in the recently published Gill (as trustee of the Gillcrest UK Pension Scheme) v Lees News Ltd [2023], the court rejected the argument that a judge must consider the state of the premises only at the date of the landlord’s notice.

The Act provides business tenants a right to a new lease on similar terms to their existing lease and, where a landlord opposes this renewal, it is now imperative for them to include a full record of the tenant’s breaches across the tenancy. The judge in Gill determined that there was substantial disrepair on the date of the landlord’s notice, but that this had been remedied by the date of the hearing itself. This effort was given “considerable” weight in the court deciding to grant a new tenancy.

However, the court will not overlook a tenant who has “a lamentable record of performance and only puts things right at the last minute”, under risk of court sanctions.

The decision in Gill demonstrates how the Act has been interpreted to provide increased protections for business tenants. This judgment means that a tenant’s efforts to remedy a breach of repair obligations will now be of greater importance. Tenants will now have additional opportunities to influence a judge’s thinking on whether that tenant ought to be granted a new tenancy. The state of the premises on the date of the landlord’s notice is no longer the determining factor; last minute effort by the tenant will have considerable, or even decisive, influence going forward.

We can assist you by providing advice on notices for the renewal of a business tenancy, or equally, on potential grounds for opposition of the same. If you require assistance in this regard or would like to make an enquiry with one of our expert solicitors, then please do not hesitate to contact our Real Estate Disputes team.

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