Statutory Tenancy

Time to get out!

Where commercial property is occupied at the end of the lease by a business tenant, it does not automatically finish, but continues - the tenant 'holding over' on a 'statutory tenancy'

This statutory tenancy, when started, can only be terminated in particular ways and the tenant needs to think ahead if he is not to find himself saddled with more rent than he wants

If he wishes to leave at the end of the lease, he needs to ensure that there is no period of 'holding over'. He can

1. Vacate the property before the end of the lease. As he is no longer in occupation, no statutory tenancy arises. Beware, however!

1.1. If he stays a nano-second beyond the end, he acquires a statutory tenancy. Then he must serve at least 3 months notice to terminate it š paying rent / observing the lease obligations for that notice period

1.2. The Landlord may claim that he has not 'vacated', if he leaves behind any stock, equipment, rubbish - anything at all, not belonging to the Landlord. If proved, he will be caught for those 3 months!

2. Serve on the Landlord a prescribed notice at least 3 months before the end. The tenant will have no continuing right of occupation š if he is a few days late leaving, it will not have the effect of automatically continuing the tenancy. However, he will be a trespasser and might be liable to 'double rent', so do not stay over too long!

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