The landlord-tenant relationship is governed by various laws, and one key piece of legislation in the UK is the Landlord and Tenant Act 1954 (LTA54). Within this Act lies Section 26, this addresses a tenant’s right to request a new tenancy. Service of a Section 26 Notice brings the old tenancy to an end but also starts the procedure for an application to be made for a new tenancy.
What is Section 26?
The Landlord and Tenant Act 1954 was enacted to provide security of tenure for commercial tenants, offering a structured framework for lease renewals. Section 26 specifically deals with the tenant’s ability to oppose the request a new lease.
What Rights does a Tenant have to a New Lease?
Under Section 26, a commercial tenant who meets the qualifying criteria has the right to request a new lease upon the expiration of their existing lease, this is assuming it has not been excluded from the Act. To qualify, the tenant must have occupied the premises for business purposes for a continuous period, and the property must be legally defined as business premises.
Should a Tenant serve Notice?
A tenant does not have to serve a Section 26 request in order to apply for a new tenancy, the tenant may wait for the landlord to serve a notice under Section 25 and then apply for a new tenancy. A Section 26 Notice cannot be served if the landlord has already served a termination notice pursuant to Section 25 or the tenant himself served a notice to quite or termination pursuant to Section 27.
The Landlord’s Response
Upon receiving the Section 26 notice, within two months, the landlord may give notice that he will oppose an application to the court for the grant of a new tenancy, this response must set out the grounds under Section 30 the landlord wishes to rely upon. Alternatively, the landlord may accept the proposed terms or negotiate changes to the tenant’s proposals.
Application to Court
The application must be made before the date specified in the request or the date immediately before any other date agreed between the parties in accordance with Section 29(B) of the LTA54. If the tenant fails to make the application in time his tenancy will end immediately before the date specified in the Notice (or agreed extension) and the tenant will have to leave the property.
The court will consider the circumstances, including the tenant’s business needs and the landlord’s grounds for opposition, before deciding whether to grant a new lease.
Section 26 of the Landlord and Tenant Act 1954 is an important component in the area of commercial leases, with the need to strike a balance between the rights of landlords and tenants.
Both parties should be aware of their rights and obligations to ensure the lease renewal process is handled effectively seeking legal advice where there is any concern or doubt over the process.
For any advice related to Section 26 or any issues regarding property disputes do not hesitate to contact me on caroline.knowles-ley@cognitivelaw.co.uk or call on 01243 943203.
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