Landlord and Tenant Act 1954

We own a portfolio of commercial properties. We currently require all new leases in the portfolio to be "contracted out" of the 1954 Landlord and Tenant Act. We understand that the procedure for contracting out has changed. Is this correct?

Yes. The practice of obtaining a Court Order to "contract out" of the security of tenure provisions contained in s24 to s28 of the Landlord and Tenant Act 1954 was replaced with a notice based procedure in June 2004. The current procedure continues to allow the parties to a lease to agree to exclude s24 to s28 of the 1954 Act provided that the landlord serves the tenant with a statutory notice and the tenant confirms receipt of the notice.

When must the Landlord's notice be served?

The landlord must serve the tenant with a notice, or "health warning" as is has been called, before the lease is exchanged. The notice is in a statutory form and advises the tenant of the rights that it will be giving up in accepting the lease that is excluded from the protection of the 1954 Act. The notice also advises the tenant to take professional advice.

And the tenant's notice?

The tenant must sign a declaration acknowledging receipt of the landlord's notice. The declaration must also be made before the lease is completed and before any agreement for lease is exchanged. The form of the tenant's declaration will depend on the time that elapsed between the service of the landlord's notice and the intended date for completion of the lease or exchange of agreements for lease. If this period will be more than 14 days the tenant's notice can be a simple declaration in the statutory form. If this period will be less than 14 days the tenant's notice must be a statutory declaration i.e. one sworn before the solicitor.

More information
For more information please email bh@boodlehatfield.com to request a copy of our flyer on Landlord and Tenant Act 1954 Reforms

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