TERMINATING THE TENANCY

The landlord must give notice to terminate the tenancy using the special form, the notice must state whether the landlord would oppose an application by the tenant for a new tenancy. If so, the notice must also give the landlord's grounds for opposing the tenant's application.

The landlord can only oppose a tenant's application for a new tenancy on one or more of a limited number of grounds. These grounds are set out in full in the notice on the special form which the landlord must give to the tenant to end the tenancy Each ground has a paragraph number.

If the tenant applies to the court for a new tenancy, the landlord can only oppose the application on one or more grounds set out in section 30(1) of the 1954 Act. These grounds are set out below. The paragraph letters are those given in the Act. The landlord can only use a ground if its paragraph letter is shown in paragraph 5 of the notice .

Grounds
(a) where under the current tenancy the tenant has any obligations as respects the repair and maintenance of the holding, that the tenant ought not to be granted a new tenancy in view of the state of repair of the holding, being a state resulting from the tenant's failure to comply with the said obligations;

(b) that the tenant ought not to be granted a new tenancy in view of his persistent delay in paying rent which has become due;

(c) that the tenant ought not to be granted a new tenancy in view of other substantial breaches by him of his obligations under the current tenancy or for any other reason connected with the tenant's use or management of the holding;

(d) that the landlord has offered and is willing to provide or secure the provision of alternative accommodation for the tenant, that the terms on which the alternative accommodation is available are reasonable having regard to the terms of the current tenancy and to all other relevant circumstances, and that the accommodation and the time at which it will be available are suitable for the tenant's requirements (including the requirement to preserve goodwill) having regard to the nature and class of his business and to the situation and extent of, and facilities afforded by, the holding;

(e) where the current tenancy was created by the sub-letting of part only of the property comprised in a superior tenancy and the landlord is the owner of an interest in reversion expectant on the termination of that superior tenancy, that the aggregate of the rents reasonably obtainable on separate lettings of the holding and the remainder of that property would be substantially less than the rent reasonably obtainable on a
letting of that property as a whole, that on the termination of the current tenancy the landlord requires possession of the holding for the purposes of letting or otherwise disposing of the said property as a whole, and that in view thereof the tenant ought not to be granted a new tenancy;

(f) that on the termination of the current tenancy the landlord intends to demolish or reconstruct the premises comprised in the holding or a substantial part of those premises or to carry out substantial work of construction on the holding or part thereof and that he could not reasonably do so without obtaining possession of the holding;

(If the landlord uses this ground, the court can sometimes still grant a new tenancy if certain conditions set out in section 31 A of the Act can be met.)

(g) that on the termination of the current tenancy the landlord intends to occupy the holding for the purposes, or partly for the purposes, of a business to be carried out by him therein, or as his residence.

(The landlord must normally have been the landlord for at least five years to use this ground.)

The landlord who relies on paragraph (d) may fail to satisfy the court that the alternative accommodation will be immediately available at the end of the current tenancy But if he shows that it will be available up to 12 months later, the court will not grant a new tenancy and may within the 14 days time limit under the Act, if the tenant requires, extend the current tenancy until the later date. The same happens if the landlord relies on paragraphs (e) or (f) and can show that he needs possession up to 12 months later than the end of the current tenancy

A landlord who relies on paragraph (f) will not succeed if:
The tenant agrees to a new tenancy giving the landlord access to enable him to carry out the intended work, which would not substantially interfere with the tenant's business.
OR

The tenant agrees to accept a new tenancy of an economically separate part of the premises and either :

this new tenancy gives the landlord access to enable him to carry out the intended work which would not substantially interfere with the tenant's business in respect of that part or

possession of the remainder of the premises by the landlord would be reasonably sufficient to enable the landlord to carry out the intended work.

The tenant on receiving notice has the right to apply for a new tenancy but he must follow the correct procedure within the time limits . Within two months of the notice being given to him, the tenant must write to the landlord saying that he does not want to leave the premises, no special form is needed for this. The tenant generally loses his right to remain in the premises unless he notifies the landlord within the two month period.

THE TENANT MUST APPLY TO THE COURT FOR A NEW TENANCY

The tenant must apply to the court for a new tenancy not earlier than two months but not later than four months after requesting a new tenancy, or after the notice of termination is given to him. If he does riot apply within this period, he will generally lose his rights to do so and to stay in his premises. So unless he has been able to reach a binding agreement in writing on all the terms of a new tenancy with his landlord before the end of the two- to four-month period, he will always need to apply to the court in order to protect his position. This is so even if the landlord has not responded within the two-month period or if he has said he is willing to grant a new tenancy.

If the landlord is unwilling to grant a new tenancy, he must within two months of the tenant's request, write to the tenant stating that he would oppose an application to the court for a new tenancy and the statutory grounds set out in the Act on which he would oppose it; no special form is needed, if the landlord fails to do this within two months he cannot oppose an application for a new tenancy. The tenant will have to apply to the court for a new tenancy, if he is not willing to leave.

APPLICATION TO THE COURT

Provided that the tenant observes the time limits for applying, the court must order a new tenancy to be granted unless the landlord can show that he is entitled to possession

If the landlord has opposed the tenant's application and can satisfy the local County Court, ( the High Court may deal with complex matters ) that possession is entitled of the property on one or more of the specified grounds then the court must grant possession. If the landlord cannot do so, the court must order a new tenancy for the tenant.

A tenant may apply for a new tenancy, at the end of any new tenancy ( whether by agreement or by order of the court ) , and so on, provided he continues to occupy the premises for business purposes.

NEW TENANCY

The terms are as the landlord and tenant agreed in writing, the court will settle any terms on which they have not been able to agree. In such cases the court is bound by the following rules:

Duration:
The tenancy may be either a periodic one or for a fixed term not longer than 14 years;

Rent:
The court may decide that the tenancy agreement should allow for rent reviews during the period of the tenancy. The rent set at the beginning of the tenancy; which may apply for the whole of the tenancy will be based on the current market value of the property having regard to the terms of the tenancy. It is not to be affected because the tenant is a sitting tenant, or higher because of goodwill created by the tenant's business - Nor because of improvements, not required by the tenancy agreement, carried out by the tenant or his predecessors either during the current tenancy or during the last 21 years, under a previous tenancy;

The other terms:
these are left to the discretion of the court, except that the court must take into account the terms of the current tenancy and all the relevant circumstances.
There is no fixed level or percentage for rent increases, the rent payable under the new tenancy is negotiated between the landlord and tenant, or set by the court.

The premises to be covered may be agreed between the parties. If they are unable to agree seek professional advice. Note that where the premises are used partly for business and partly as living accommodation the tenant, if covered by the Act, will he entitled to a tenancy of the whole premises. The tenant will not be entitled to a new tenancy in respect of any part of the premises which has been sub-let other than to an employee employed in the business for which the premises are occupied. The landlord can insist that a new tenancy granted under the Act shall cover the whole premises covered by the previous tenancy
The new tenancy will start normally either on the date of termination specified in the landlord's notice or the date specified in the tenant's request for a new tenancy. If an application is made to the court, the new tenancy starts on one of these dates, or three months after the application is finally disposed, whichever is later.

The tenant must accept the terms of the new tenancy ordered by the court unless

Either
the landlord and tenant agree terms between themselves;
Or
within 14 days of the court making the order for the new tenancy the tenant applies to the court asking for the order to be revoked. If requested to, the court must revoke the order, but when doing so the court can extend the current tenancy long enough to give the landlord a reasonable chance of re-letting the premises. Once the order is revoked the tenant must leave in accordance with the provisions of the Act.

REFUSAL OF A NEW TENANCY

The landlord can refuse the grant of a new tenancy if opposed on a limited number of grounds. If the grant of a new tenancy is refused, compensation is payable to the tenant.
But only if:
- the landlord has opposed or the court has refused the grant of a new tenancy solely on the grounds set out in paragraph (e), (f) or (g) ; and
- there is no agreement which effectively excludes compensation.