Business granted new tenancy despite opposition from landlord

A recent case involving Gill v Lees News Ltd highlights the granting of a new tenancy to a business despite opposition from the landlord due to breaches of the tenancy agreement. Stephanie Johnson, Senior Associate Solicitor, provides a report on this case.

The landlord opposed the tenant’s application for a new tenancy based on disrepair, rent arrears, other breaches of the agreement, and an intention to redevelop the premises.

In the county court, it was determined that there was evidence of disrepair and persistent delay in rent payment. However, the other grounds of opposition were not proven. Although the tenant’s conduct regarding disclosure and disrepair was unsatisfactory, there was a genuine effort to rectify the premises’ condition. The necessary repair works had been completed, and the business operators, a husband and wife, were committed to preventing further breaches of the repairing covenant.

Additionally, the court concluded that late payment of rent would not occur again. Considering all the grounds, the balance favored the tenant, and the landlord’s opposition did not justify denying a new tenancy.

The landlord claimed that the judge overlooked the tenant’s dishonest denial of disrepair while carrying out works and argued that this dishonesty should disqualify the tenant from obtaining a new tenancy.

However, the High Court rejected the appeal, ruling that the judge had correctly interpreted the law and considered each ground of opposition separately and collectively. The judge acknowledged the tenant’s conduct but determined that it did not hinder the exercise of discretion in favor of the tenant, as there was confidence in future compliance.

The landlord failed to demonstrate severe disrepair necessitating rebuilding, and the judge’s conclusion regarding the tenant’s future compliance fell within a reasonable range of conclusions.

For further information about the issues discussed in this article or any aspect of commercial property law, please reach out to Stephanie at 01228 516666 or send her an email by clicking here.