With supervision time at a premium, the graduate surveyor or junior lawyer needs a reliable road-map to the significant moments in the life of a lease. This web course presents an extended case study, considering the key terms of a modern commercial lease form as applied to events over the term of a tenancy. Up-to-date caselaw is included, as well as the three key Protocols.
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Part 1: Negotiation: getting the foundations right
Most problems in the management of commercial leased property arise because potential issues were not identified at the outset. When negotiating heads of terms and documenting the lease, this part explains what you need to know about:
- Security of tenure and contracting-out
- The implications of any pre-existing disrepair
- Scope and extent of the repair obligations
- Documenting the tenant’s fit-out period
- The role of lease guarantors
- Complications with franchised businesses
- Agreements for lease and interim occupation
Part 2: Disrepair, alterations and consent
This part examines the issue around consent for alterations from the point of view of both the landlord and tenant. It explains the best practice for requesting consent and the extent to which the landlord is required to act reasonably in responding. It also highlights how tenants can carry out alterations even in circumstances where the landlord objects.
It focuses on:
- Typical content of alterations covenants
- The Alterations Protocol, and the conduct of requests for landlord’s consent
- The degree of control which landlords can exercise
- How tenants may overcome landlord’s objections
- Implications for lease guarantees
- Rent review implications
- Dealing with mid-term dilapidations
Part 3: Escaping the rental commitment
Tenants needing to offload premises will typically seek to assign or sub-let them and this part explains the contractual and other considerations that they need to be aware of as well. It explains what a landlord needs to bear in mind when dealing with requests for consent and how a tenant can use available levers to get to their desired outcome.
- Typical content of an alienation clause
- The Alienation Protocol, and the conduct of requests for landlord’s consent
- Assessing the third party’s covenant strength
- Landlord’s duties, and what is a ‘reasonable time’ to make the decision?
- Comparison of assignment and underletting
- Rental restrictions on underletting
Part 4: Expiry and turnaround
As lease expiry looms, both landlord and tenant need to be well-prepared for what comes next. Landlords will focus on disrepair and reinstatement of alterations and need advice on remedies. For tenants, lease termination can be fraught with difficulties – operating break options, navigating Dilapidations Protocols and identifying routes to termination under the 1954 Act.
- Exercise of break options – practicalities and common conditions
- Preparation for lease expiry – timescales and deadlines
- Reinstatement of alterations
- Disrepair and the Dilapidations Protocol
- Termination by tenants of leases within the 1954 Act