A business tenancy protected under the Act will not end automatically at the expiration of a lease for a fixed term. Instead such a tenancy can only be terminated in one of the prescribed ways set out in law.
As a result, when seeking to end a commercial tenancy at any point, it is essential to seek professional legal advice at the earliest opportunity.
At Seatons, our team of highly trained legal advisors have a wealth of experience in commercial tenancy matters and provide clear, easy to understand legal advice at low sensible fees. For more information, feel free to give us a call on 01536 276300
Methods of Termination
Business tenancies are most commonly terminated through the following ways:
- By service of a landlord’s statutory notice – s25 notice
- By tenant’s request in statutory form – s26 request
S25 Notice to Terminate
If the landlord requests the business tenancy to end, they must serve a Section 25 Notice on the tenant stating when the tenancy will end. The formalities are as follows:
- It must be in writing, the correct form and signed by the landlord;
- It must be given within a specified time frame before the termination; and
- It must specify whether the landlord would oppose an application from the tenant requiring a new tenancy with reasons.
Rather than waiting for the landlord to serve a section 25 notice, the tenant can sometimes take the initiative and request a new tenancy from the landlord under section 26. In order to do this successfully, the tenant should serve a section 26 notice in writing to the landlord, and specify a time frame for when the new tenancy commences.
The tenant should bear in mind however that the sooner there is a new tenancy, the sooner the new rent will be payable, which could very well be higher than the rent payable under the old tenancy. Nevertheless, there are situations where the service of a request by the tenant is used for tactical purposes.
A section 26 request cannot be served if the landlord has already served a section 25 notice. Furthermore, a request is only possible where the tenant’s current lease was granted for a term of years exceeding one year.
Tenant’s Notice to Terminate
If the tenancy is for a fixed term, the tenant can give notice in writing 3 months before the contractual end. If the tenant has remained in the business premises at the end of the fixed term, they can terminate the tenancy by giving the landlord notice in writing at least 3 months in advance.
Opposing a New Tenancy
For various reasons, the landlord may not wish to grant a new tenancy to the tenant. However, under the protection of the Act, the landlord can only successfully oppose a new tenancy if it incorporates and proves one of the following reasons:
- Premises are in disrepair
- Persistent delay in paying rent
- Substantial breach of covenant
- Landlord has offered a reasonable alternative accommodation
- Landlord wants to let whole of premises, and tenant was a sub-tenant
- Landlord intends to demolish premises or complete substantial construction work
- Landlord intends to occupy the premises himself.
Commercial Property Specialists In Corby & Kettering
Hello, I am Gemma McKimmie and I am the Head of Seatons Solicitors Commercial Property Department. We aim to provide our clients with an outstanding legal service.
We will help and support you and most importantly we work hard for you.
Please contact us for a free, no obligation chat at either our Corby office on 01536 276300 or our Kettering office on 01536 311690 or contact us online.