Business Premises, Tenant in Occupation won't sign lease

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  • Business Premises, Tenant in Occupation won't sign lease

    The tenant sold the business to the occupier. There was an agreement but is was Trading Agreement.
    The occupier has no lease agreement. For past 3 months have been trying to get occupier (new Tenant) to sign new lease but they keep stalling.
    LL getting very frustrated and thinks they are trying to find other premises.

    Can they be served with 3 months notice to go ? They pay the rent monthly or is there another way ?

    They do rent other premsies with a lease outside act and 2 month break clause.

    Any advice gratefully received please

  • #2
    So effectively your gripe should be with the original tenant? did they have a restriction against departing with possession? Have you accepted rent from new occupier?
    [I]The opinions I give are simply my opinions and interpretations of what I have learnt, in numerous years as a property professional, I would not rely upon them without consulting with a paid advisor and providing them with all the relevant facts[I]

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    • #3
      The Agreement was more of a trading agreement. The tenant paid his rent montly, sold his business to the occupier, and the occupier took over the premises. It is the occupier that won't sign the lease, though they did sign one for another premises. it is the occupier the LL wants out.

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      • #4
        What relevance does the "other premises" have? What is a "trading agreement" it should either be a) a licence or b) a lease.

        As I asked previously, did the freeholder accept rent from the new occupier?
        [I]The opinions I give are simply my opinions and interpretations of what I have learnt, in numerous years as a property professional, I would not rely upon them without consulting with a paid advisor and providing them with all the relevant facts[I]

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        • #5
          Thank you for your help, the company that brought the business is occupying the premises and paying monthly rent to the Landlord, which the LL has demanded. They are the ones not signing the leases. The orignal tenant (a company) is no longer as business brought out and now ceased. If the occupier does not sign the lease, but they have agreed thr terms how can the LL get them out.

          They signed a lease for another of the LL premises and paying rent but there is a break clause - so easy to get them out of that, just the unit where there is no lease/assignmnet as the origal tenant ocuppied with a trading agreement.

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          • #6
            The fact that rent has been demanded and paid does not help. LL should have served section 146 notice on the original tenant and sought to forfeit to force occupiers hand. The argument that the occupier could make is that theyre occupying on the basis of your agreement with the previous tenant and have accepted an assignment based on the action of demanding and accepting

            When you say the other premises has a break clause... Was the contracting out of their lease completed correctly - ie served with the obligatory "health warning" as well as a stat dec signed and witnessed (if required?). If not the break is ineffectual.
            [I]The opinions I give are simply my opinions and interpretations of what I have learnt, in numerous years as a property professional, I would not rely upon them without consulting with a paid advisor and providing them with all the relevant facts[I]

            Comment


            • #7
              What terms was the previous occupier on? Was there a break clause in the original lease, was it contracted out? It might be advantageous to accept that assignment was taken place if this is so. Or was there no formal lease of any kind in place at all?

              What is the rush to force the occupiers hand - is there another tenant waiting? Better to have a paying tenant than an empty shop, even if he is looking to move. Perhaps offer an incentive to sign on rather than the stick of the threat of forfeiture.
              caveat emptor
              If it sounds like I know what I am talking about........I don't.

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              • #8
                The tenant sold the business to the occupier on a trading agreement. By that, I assume the tenant has not sub-let but simply sold the business. The tenant should've applied to the landlord for consent to assign the lease to the occupier but presumably the occupier wanted to trade before committing. What isn't clear is why the LL demanded rent from the occupier, not the Tenant. If the Tenant has since gone bust then I see no reason why the LL should not obtain possession of the premises, or least require the occupier to regulate the position by taking over the lease.

                You might find some help from Manton Securities v Nazam [2008]

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