A brief overview of the Landlord and Tenant 1954 Act and its practical implications for landlords and tenants.
What is the 1954 Landlord and Tenant Act?
The Landlord and Tenant Act 1954 gives commercial tenants the right to a lease renewal at the end of the contractual term of a lease and the ability to remain in occupation at the property. This provides the tenant with security of tenure. It should be noted that the 1954 Act applies to written and oral tenancy agreements.
What is security of tenure?
Security of tenure benefits the business tenant by securing business continuity. This is because the tenancy will not automatically come to an end and will continue on the same terms under the tenancy until renewed or terminated in accordance with the Act.
Does the 1954 Landlord and Tenant Act cover residential houses?
The Landlord and Tenant Act 1954 only applies to commercial business tenancies, it does not apply to residential tenancies.
How can I get my tenant out of my commercial property?
If you are a landlord, you will only be able to oppose a tenant’s request for a lease renewal on certain grounds which carry strict criteria which must be satisfied.
One of the most frequently used grounds for opposing a lease renewal is Section 30(1)(f) (Ground (f)) of the Landlord and Tenant Act 1954, where the landlord must provide substantial evidence of an intention to redevelop or reconstruct the property. This must be a firm and settled intention, rather than merely an idea. In a leading case the Court said that the landlord must prove its genuine intention to carry out works at the date of the trial, showing evidence such as plans and drawings for the development, financing and a building contract. Each case turns on its own facts.
How can I avoid giving a tenant security of tenure?
It is possible for a lease to be “contracted outside” the 1954 Act, meaning that the tenant will have no right to remain in occupation or renew the lease at the end of the contractual term. The tenant will therefore need to vacate the property or have completed a new lease by the end of the contractual term.
The 1954 Act status of a commercial tenant’s occupation of a property has significate repercussions on both a tenant’s and landlord’s rights at the end of the term of a lease. This status should be carefully considered in terms of business planning, repair obligations and the level of rental applied to any tenancy.