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New Lease Terms commercial lease 54 Act

New Lease Terms commercial lease 54 Act

Postby convoy2 » Tue Jun 13, 2017 10:49 am

Hi
Landlord serves tenant sec 25 offering a new lease with new terms.
Tenant makes a counter proposal , much lower.

(time in between landlord has been offered better terms by a 3rd party and realises higher worth than even his original offer)

Does this makes the landlords offer terms of no worth and/or can the tenant accept these at any time.
Would these terms be taken on board if the parties end up in court?

Thanks
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Re: New Lease Terms commercial lease 54 Act

Postby atticus » Tue Jun 13, 2017 11:11 am

The tenant must apply to the court before the date on which the tenancy terminates. If the tenant does not, the tenancy is at an end and the tenant loses his rights.

If in doubt, take legal advice.

The Court will be aware of both sides' proposed terms. In most cases the Court will require a surveyor to be appointed as single joint expert to report.
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Re: New Lease Terms commercial lease 54 Act

Postby theycantdothat » Tue Jun 13, 2017 3:27 pm

If the tenant applies to the court in time can the court order a new lease at a rent exceeding that set out in the section 25 notice?
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Re: New Lease Terms commercial lease 54 Act

Postby atticus » Tue Jun 13, 2017 9:56 pm

I *think* so, if the market evidence justifies it. The court may order an interim rent for the period between the end of the tenancy and the decision of new terms; this may be at an intermediate level.
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Re: New Lease Terms commercial lease 54 Act

Postby theycantdothat » Wed Jun 14, 2017 7:43 am

If the landlord is not bound by the terms there seems to be little point in the requirement.
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Re: New Lease Terms commercial lease 54 Act

Postby atticus » Wed Jun 14, 2017 7:48 am

That rather depends on what you think the requirement is and what you think it means.

Was the tenant well-advised to refuse the terms offered?

Bear in mind also that a s25 notice must give at least 6 months notice. If a tenant brings court proceedings, then they will often take a year or so to get to trial. The Court's decision can be 18 months or more after the date of the s25 notice. In that time the market can move.
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Re: New Lease Terms commercial lease 54 Act

Postby atticus » Thu Jun 15, 2017 1:06 pm

@tcdt - I have just looked at s34. I cannot see that it contains any provision limiting the rent the court may determine to that proposed by L (or indeed by T if the market should fall).
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Re: New Lease Terms commercial lease 54 Act

Postby theycantdothat » Fri Jun 16, 2017 7:33 am

atticus wrote:@tcdt - I have just looked at s34. I cannot see that it contains any provision limiting the rent the court may determine to that proposed by L (or indeed by T if the market should fall).


Agreed. I also noted something which I had not taken in before, which is that there is nothing to say at what date the rent is to be assessed. Presumably it is the date of the court hearing. That contrasts with a standard rent review clause which will specify that the rent is to be assessed at the review date.

That still leaves us puzzling what the idea is behind the change in wording of the section 25 notice.
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