Commercial lease disputes

Almost every commercial lease dispute is decided by what the lease actually says — which is frequently not what either party remembers agreeing.

Where these disputes come from

Rent review. Usually upward-only, usually to open market rent, and usually determined by a formula and assumptions set out in the lease. The assumptions matter enormously — what the hypothetical letting is assumed to be, what improvements are disregarded, what term is assumed — and they are where the argument is. Most reviews are settled by negotiation or determined by a third party expert or arbitrator under the lease’s own machinery.

Repair and reinstatement. What the tenant has to keep in repair, to what standard, and what must be put back at the end. Covered more fully on the dilapidations page, but it arises during the term too.

Alienation. Assignment, subletting and sharing occupation. Most leases require consent, and most require it not to be unreasonably withheld — which is a real constraint on a landlord and a real remedy for a tenant facing delay. A landlord who sits on a consent application is not neutral; it is a breach.

Service charge. What is recoverable, whether it was reasonably incurred, and whether the landlord has followed the lease’s own procedure.

User and alterations. What the premises can be used for and what the tenant may change.

Arrears and recovery, including commercial rent arrears recovery and the question of whether forfeiture is a sensible remedy or a destructive one.

What decides these disputes

The words of the lease, construed objectively in their context. Not what the parties intended privately, not what the agent said, and not what is usual in the market.

The conduct of the parties, which can waive rights. A landlord who accepts rent knowing of a breach may lose the right to forfeit for it. A party who does not respond to a notice may be taken to have accepted its terms.

The strict wording of any notice, and whether it was served in the way the lease requires, on the right person, at the right address, within the right period. Notice provisions are construed precisely, and a notice that fails on service is worth nothing however good the underlying position.

Acting for landlords, and for tenants

We act for both, though not on the same matter, and we run conflict checks before taking instructions.

For landlords, particularly those with portfolios: enforcing covenants, recovering arrears, dealing with breach, opposing renewal where there is a ground, and the commercial judgment about which disputes are worth having.

For business tenants: responding to schedules and notices, negotiating exits, resisting unreasonable refusals of consent, and challenging service charge demands.

The advantage of acting on both sides is not diplomatic. It is that you know how the other side is being advised, what they will settle for, and which arguments they are being told are strong.

What we do

Read the lease — properly, which is the part that determines everything else. Advise on the merits before the dispute escalates. Serve and respond to notices correctly. Negotiate, and litigate where necessary. And advise on the commercial question, which is usually whether a dispute with a tenant you will still have in three years is worth winning.

What it costs

£400 per hour plus VAT with an estimate by stage.

A lease review against a specific lease — what it requires, what your position is, and where the risks sit — is a fixed fee. For anyone facing a dispute or about to take or grant a lease, it is the most useful thing we do.

Questions

Questions people ask us

My landlord is refusing consent to assign. Can they do that?

Usually not without a reason. Most leases require consent not to be unreasonably withheld, and there are statutory duties to respond within a reasonable time and give written reasons. A landlord who delays without explanation is in breach, and there are remedies.

Can my rent go down at review?

Almost never in practice — most commercial leases have upward-only review clauses. What is negotiable is the assumptions the review is based on and the evidence of comparable rents.

My landlord has accepted rent despite my breach. Does that matter?

It can. Accepting rent with knowledge of a breach may waive the right to forfeit for it. Whether it has depends on what they knew and when.

The notice they served looks wrong. Does that help me?

Possibly a great deal. Notice requirements are construed strictly — form, timing, service, and the correct recipient. A defective notice is frequently ineffective, and the consequences of that can be substantial.

Is it worth fighting this?

Sometimes not. A dispute with a tenant or landlord you will still be dealing with for years has a commercial cost beyond the legal one. We will give you a view on that as well as on the merits.

The hub

Property disputes →

Also in this area

Lease renewal and the Landlord and Tenant Act 1954 →

Also in this area

Dilapidations →

Start with a conversation

A free 20-minute call. Tell us what has happened and we will tell you whether we can help, what it would involve and roughly what it would cost.

No charge

A free 20-minute call

Tell us what has happened and we will tell you whether we can help, what it would involve and roughly what it would cost. No advice is given on this call and there is no charge for it.

£350 plus VAT

A paid strategy session

One hour with a partner, followed by a written summary of your position and options. For people who want proper advice without instructing a firm yet. Credited in full against your fees if you go on to instruct us.

Or reach us directly

0207 112 8818

WhatsApp +44 7476 045967

[email protected]

We answer enquiries the same working day.