What if the tenant stops paying rent, and someone else moves in and pays rent?

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    What if the tenant stops paying rent, and someone else moves in and pays rent?

    My commercial tenant stopped paying rent last year and "assigned" his lease to someone else before informing me, and then asked if I would sign a new lease at the same rent with the new occupant (after he took money from him of course!). I said no, as his rent is over 100% below market rate, which is why someone would pay to take over his lease. FYI his lease expired last year but it is within the 1954 Tenancy Act.

    The new occupant wants the lease to himself, and has offered to pay rent and even cover all the arrears (6 months) of my tenant.

    Is the lease automatically assigned to the occupant if I accept his rent and the original tenant pays me nothing? Does the new tenancy remain in the 1954 act? My original tenant won't give up his lease until someone pays him off yet again.

    Can I somehow "terminate" the rolling lease by taking rent from the occupant? If yes, does the occupant take over a rolling lease (i.e. expired but inside the Tenancy Act) or a brand new 10 year lease?

    ps: We sent a section 40 a few months ago and he claimed that was the sole tenant, and that the occupant is an "employee". This can be easily disproved though as they run different companies that are based on my property.

    Would be interested in hearing advice on situation above as I am in a broadly similar situation, I have held off taking rent but after 18months this is becoming critical. Ideally I want vacant possession.


      I also had something similar occur. I had a tenant with a lease inside the 1954 Act. I had moved overseas so I did not know what was going on.
      It appeared that the tenant ran out of money and gave a Third Party the keys who took over the premises. I believe he paid some money.
      I was asked to "assign" the lease to the Third Party. I refused to do it as although leases often say that a request for an assignment cannot be unreasonably refused I had a thorough investigation of the Third Parties finances and found sufficient reason to refuse to grant an assignment.
      Had I not been living overseas I would have taken the premises back myself.
      I started to take Rent off the Third Party, thus he became a Periodic Tenant.
      When he wanted a new lease I was only prepared to offer a 3 year lease Outside the 1954 Act which he agreed to.
      I wont say whats happened since but its essential that if you offer a new lease its outside the 1954 Act.

      With another Commercial Lease my solicitor inserted a very useful clause in that the lease was a Full Repairing and Insuring Lease and that if I needed to have a Schedule of Dilapidations done, I could charge the Tenant. A good Chartered Surveyor quoted £2500.




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