Does a Commercial Lease Die when the Landlord Dies?

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    Does a Commercial Lease Die when the Landlord Dies?

    This is a mess. It's been on the to do list for decades, but now my hand may be forced.

    Decades ago my father bought a small office block and over the years filled it with tenants. It was his retirement plan. At one point in the 90s there was a river flood and the tenant on the ground floor moved to the empty first floor with his blessing. After repairs were carried out, the tenant liked the first floor so much, they negotiated a new lease. However before it was signed, my dad died aged only 57.

    Roll on two years and his other business activities had been wound up, the office passed to my mother and the estate settled. Sadly, she had little interest in the office so the running of it fall on my shoulders. It didn't seem like a big deal as it ran itself. Money in, money out via a sole trader account which she made me joint signatory on since it saved her being bothered by me to sign cheques. Roll on another 5 or so years, and mother has moved away giving me power of attorney to run everything in her absence. Any new leases were written with her as a person as landlord, not as a business entity.

    The property served it's purpose - it generated sufficient income for her not to worry about money.

    A few years later I had cause to review leases and that is when I discovered that the first floor tenant didn't really have a lease as such. I asked the tenant if they'd like one, but they declined. I didn't press them since they were a good tenant, paid rent on time, didn't query service charges. Consulting my solicitor, I discovered that since they had been acting as if they had a lease and had complied with all of my requests, Scots law says they have a lease. Perhaps it's the same in England.

    Last month mother passed away. Reading her will, she made no distinction between between personal assets and business assets and bar a few gifts, left everything to me and my sister divided equally. We're also the executors.

    Now my vague grasp of things is that her "business" died with her since she was a sole trader at least in the eyes of the bank. The bank's business manager seemed to think so and was only too happy to open a sole trader account in my name since there is still rent coming in and bills to pay.

    But did the lease die with her too?

    If Scots law is the same as English law (which I would expect to be the case in this instance though one cannot be sure) then the tenancy continues.


      Sorry for your losses.

      Certainly for Scots residential law tenancy continues - goes back to Scottish "Leases Act" 1449 (fascinating wording in old Scots)

      - but don't know for sure about Commercial. Will pm you name of specialist in residential landlord/tenant who may know or may recommend another firm.

      Slàinte mhath!
      I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...


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