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Technical Aspects of Business Leases - Overcoming the Practical Difficulties
Thorogood Publishing, May 2001, Pages: 83
Estate and Facilities management involves many different aspects, with a business lease being one of the most vital working documents.
A business lease sets the rent, enables rent reviews, allocates responsibility for repair and maintenance and specifies the use to which the premise may be put, all within a complex legal framework, and as the essential document of estate management, it must be easily understood by non-lawyers. However, it is inevitable that issues which require a technical understanding of the law relating to landlords and tenants will arise.
The purpose of this report is to highlight areas where technical issues might lead to practical difficulties, and to give clear guidance to help those involved in property management avoid the pitfalls.
Written in a clear, concise and easy-to-understand format, Malcolm Dowden presents an invaluable set of explanations and answers for all those having to deal with a business lease.Like his seminars and lectures, this report focuses on the steps that can be taken by landlords, tenants and their respective agents to spell out their agreed terms, and to cut down the lawyers’ scope for argument.
This report will:
- Thoroughly analyse technical and legal issues when dealing with estate and facilities management
- Guide you through estate and facilities management aspects in a clear and easy-to-understand manner
- Focus on the solutions to the agreed terms and complex legal contract arguments
- Empower you to successfully and confidently deal with estate management technical and legal issues
Who will benefit from this report?
- Facilities managers and property managers
- HR managers with responsibility for the FM function with their organisation
- H&S managers
- Production and works managers
- Commercial property landlords
- Construction managers
- Company secretaries
- Professional advisers
- Owners and directors of companies without a specialist manager who nevertheless need to know where they stand and what they need to do
1. Is there a tenancy?
- The lease-licence distinction
- The risk of informal arrangements
- Tenancies at will – holding over after the expiry of a contracted-out tenancy
- Terminating the implied tenancy at will – what happens next?
- Short-term tenancies excluded from protection
- Can a mere licensee grant a lease?
2. Excluding security of tenure
- Landlord and Tenant Act 1954 – section 38(4)
- Alterations to the draft lease
- The purpose of section 38(4)
- Using the ‘wrong’ Court
- Ripe for reform?
3. Break clauses
- Break notices and the Mannai test
- Conditional break clauses
- Break clauses and the survival of underleases
4. Landlord and Tenant Act 1954 – End of tenancy
- When does a tenancy end?
- Sight & Sound Education Ltd v Books etc Ltd  43 EG 161
- Conclusions drawn from recent cases
5. Landlord and Tenant (Covenants) Act 1995
- Can a surety be required to give an Authorised Guarantee Agreement (AGA)?
- Can a landlord require an AGA as of right or must the requirement be reasonable?
- Section 17 notices
- Section 3(5) and the enforcement of covenants
6. Landlord’s consent
- The landlord’s entitlement to information
- Withholding consent because of an anticipated breach of covenant
- Dealing with an unauthorised assignment or underletting
I- nadvertent grant of consent
7. Derogation from grant
- Chartered Trust v Davies  2 EGLR 83
- Petra Investments Ltd v Jeffrey Rogers plc  EGCS 66
8. Quiet enjoyment
- Cases in the House of Lords
- Housing of the Working Classes Act 1885
9. Lease variations – Letting guarantors off the hook
- Avoiding the trap
- Contractual terms
- Primary or secondary liability?
Malcolm Dowden is the senior professional support lawyer in the property department at Nabarro Nathanson. Based at the Reading office, he provides a full range of professional support services to property lawyers across the firm, including regular updates on new legislation and case law. Malcolm graduated from Oxford in 1986 with a first class honours degree in Modern
History. He is also a regular contributor to the legal and professional press – including The Estates Gazette, Property Law Journal and Butterworths’ online law journal In Context.
The key issues discussed in this Report stem from Malcolm’s work as a professional support lawyer – a role which involves frequent and ongoing discussion of points encountered by fee earners during lease negotiations. Perhaps surprisingly, it is these nitty-gritty issues, rather than the ‘rocket science’ of rent reviews or complex deal structures, that can result in delay and stalemate during negotiations.