#16684 - Security Of Tenure - Property Law and Practice

SECURITY OF TENURE

Governed by Landlord and Tenant Act 1954.

Landlord	Tenant
Determine the contractual end date of the lease.
Is the tenancy protected under s.23 L&TA 1954? [use flowchart] Lease or licence? Street v Mountford [1985]: A lease must grant exclusive possession of the property for a fixed or periodic term at a rent. Look at the effect of the written agreement, not its label. In occupation Occupation can be by the tenant personally, or through the medium of an agent or manager, or by a company owned by the tenant. This can be partial occupation. Business use Business’ is widely defined and includes ‘a trade, profession or employment and in the case of a ‘body of persons’ any activity carried on by them. ‘Any activity’ means just that; it need not be a business or commercial activity. Term of tenancy The tenancy be for a fixed term of 6 months or more. OR the tenant must in occupation for 12 months or more if in periodic tenancies of under 6 months. Excluded tenancies Fixed term tenancies not exceeding 6 months Service tenancies Tenancies at will Tenancies of agriculture holding Mining leases Contracting out Check in lease for reference to the serving of the required s.38A Notice If no reference, then not contracted out of L&TA 1954, Part II
Effect of L&TA 1954: Lease will not expire at end of contractual term – the tenancy holds over indefinitely. The tenancy can only be ended in one the ways specified in the Act.

Determine the contractual end date of the lease.

Is the tenancy protected under s.23 L&TA 1954? [use flowchart]

Lease or licence?
- Street v Mountford [1985]: A lease must grant exclusive possession of the property for a fixed or periodic term at a rent.
- Look at the effect of the written agreement, not its label.
In occupation
- Occupation can be by the tenant personally, or through the medium of an agent or manager, or by a company owned by the tenant.
- This can be partial occupation.
Business use
- Business’ is widely defined and includes ‘a trade, profession or employment and in the case of a ‘body of persons’ any activity carried on by them.
- ‘Any activity’ means just that; it need not be a business or commercial activity.
Term of tenancy
- The tenancy be for a fixed term of 6 months or more.
- OR the tenant must in occupation for 12 months or more if in periodic tenancies of under 6 months.
Excluded tenancies
- Fixed term tenancies not exceeding 6 months
- Service tenancies
- Tenancies at will
- Tenancies of agriculture holding
- Mining leases
Contracting out
- Check in lease for reference to the serving of the required s.38A Notice
- If no reference, then not contracted out of L&TA 1954, Part II

Effect of L&TA 1954:

Lease will not expire at end of contractual term – the tenancy holds over indefinitely.
The tenancy can only be ended in one the ways specified in the Act.

S.25 Notice (prescribed form)	Purpose: Renegotiate lease Stop T obtaining new lease	S.26 Request (prescribed form)	Purpose: T seeking new Lease T serves on L to trigger process Fixed term must be 1 year or more
Other methods of termination: Tenant’s notice under s.27 L&TA 1954 (‘S.27 Notice’) Serve 3 months before contractual end of lease OR T can just vacate by contractual end date Forfeiture: by landlord for breach of T covenants Surrender: agreement of both parties to terminate lease

S.25 Notice (prescribed form)

Purpose:

S.26 Request (prescribed form)

Purpose:

Procedure:

L must state proposed termination date of existing lease [and if they want T to leave at that point]
Proposed end date cannot be earlier than contractual end date
S.30(1) grounds of opposition to T being given a new lease**
Notice must be served in the prescribed form
T or L may apply to Court for a new Lease OR L can apply to Court to end the existing lease

Procedure:

T must state proposed start date of new lease
Proposed start date cannot be earlier than the day after contractual end date
T may give new terms of lease
L may serve a Counter-Notice on T; this must include grounds of opposition
T or L may apply to Court for a new Lease OR L can apply to Court to end the existing lease

Time Limits***:

Notice to be served on T not more than 12 or less than 6 months before proposed end date
Application to Court must take place before end date specified in Notice

Time Limits***:

Request to be served on L not more than 12 or less than 6 months before proposed start date
L’s counter-notice must be served within 2 months of T’s service of the s.26 Request
Application to Court must take place before start date specified in Request

Other methods of termination:

Tenant’s notice under s.27 L&TA 1954 (‘S.27 Notice’)
- Serve 3 months before contractual end of lease
- OR T can just vacate by contractual end date
Forfeiture: by landlord for breach of T covenants
Surrender: agreement of both parties to terminate lease

** S.30(1) Grounds of Opposition:

Grounds (a), (b), (c), and (e) are discretionary grounds (‘tenancy default’ grounds). The Court has discretion as to whether T ought to be refused a new tenancy, even where L has established one of these grounds.
Grounds (d), (f), and (g) are mandatory grounds. Where L has established one of these grounds, the Court must refuse T a new tenancy.
- The ‘5-Year Rule’ applies to ground (g) only. In order to rely on this ground, L must have been the landlord for at least 5 years prior to the court hearing unless L actually granted the lease (for less than 5 years) that L is seeking to end.
- L must how evidence of intention to demolish/reconstruct or to occupy under grounds (f) or (g). If L can show such intention, the Court must refuse to order the grant of a new tenancy.
- E.g. existence of work programme, hiring of builders or plant, application for planning permission, planned refurbishment works, contracts, existing lease ending, financing of works, etc.
- L may change their mind later on, but T can’t do anything about it.
If L is successful under grounds (e), (f), or (g), T may be entitled to compensation from L. This is calculated on the rateable value of the property.
- Where T has been the T for 14+ years or the same business has operated from premises for 14+ years, T is entitled to 2x rateable value

*** Window of Opportunity for Serving S.25 Notice/S.26 Request:

The window of opportunity is the period in which the s.25 Notice can be served to end the lease at the earliest date.

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