Most leases of business premises have security of tenure, meaning that the tenant does not necessarily have to leave at lease expiry, unless one of a number of grounds are made out.
The grounds are set out in section 30(1) of the Landlord and Tenant Act 1954 and, in brief terms, are as follows:
- The premises are in disrepair (Ground (a))
- There are arrears of rent (Ground (b))
- There are other breaches of covenant (Ground (c))
- There is suitable alternative accommodation (Ground (d))
- The tenancy was created by a sub-letting (Ground (e))
- The landlord has an intention to redevelop (Ground (f))
- The landlord has an intention to occupy (Ground (g))
A significant body of case law has evolved since 1954 governing how these grounds of opposition work in practice. Generally, grounds (f) and (g) tend to be the ones most commonly relied upon.
If a landlord wishes to rely on one of the grounds of opposition, it will need to prove its ground(s) of opposition at a court hearing, unless agreement can be reached between landlord and tenant as to the tenant’s exit terms.