This blog provides a practical commentary on commercial lease renewal disputes under the Landlord and Tenant Act 1954 (the “1954 Act”), including recent themes emerging from the courts. It is written for landlords, tenants, solicitors and valuation surveyors involved in landlord and tenant surveys, lease renewal negotiations and contested renewal proceedings.
What is a Lease Renewal under the Landlord and Tenant Act 1954?
Part II of the Landlord and Tenant Act 1954 gives qualifying business tenants “security of tenure”. In simple terms, a protected tenant has a statutory right to a new lease renewal unless the landlord can prove one of the statutory grounds of opposition. The 1954 Act process is commonly triggered by a landlord’s section 25 notice or a tenant’s section 26 request.
Why Lease Renewal Case Law Matters
Lease renewal litigation is fact-sensitive, and the courts’ approach to evidence (particularly landlord intention and funding) can decisively affect outcomes. For valuation surveyors and landlord and tenant surveyors, understanding the latest case law helps to: i) assess prospects early, ii) advise on negotiating strategy, iii) quantify risk, and iv) support expert evidence where terms or rent are disputed.
Key Lease Renewal Issues Where Surveyors Add Value
In most 1954 Act renewals, surveyor input is central to the issues the court is asked to decide, including:
• Rent determination under section 34 (market rent assumptions and comparable evidence)
• Lease terms and modernisation (including break clauses, alienation, repairing and service charge)
• Interim rent applications (where relevant)
• Evidence on whether proposed works are genuine, fundable and deliverable (opposed renewals)
• Strategy around holding/extent of premises where only part is occupied
Recent Case Law Themes in Lease Renewals (1954 Act)
1) Redevelopment opposition (Ground (f)) – intention and funding are under the microscope
A consistent theme in recent decisions is the court’s close scrutiny of whether the landlord’s redevelopment plans are real, settled and achievable. Even where intention is accepted in principle, landlords can fail if they cannot demonstrate credible deliverability – particularly funding, consents and a realistic programme. This reinforces the importance of contemporaneous evidence (board minutes, finance approvals, planning strategy and contractor input).
For lease renewal advice, this means both parties should front-load evidence early: landlords to prove a firm and settled intention to redevelop; tenants to test deliverability and whether works can proceed without possession.
2) Intention to occupy (Ground (g)) – goodwill and “same business” arguments
Recent judgments have considered Ground (g) (intention to occupy for the landlord’s own business). Tenants have increasingly explored arguments around business goodwill and whether a landlord can rely on Ground (g) where it intends to operate an essentially similar use. The courts have generally maintained a statutory approach, focusing on whether the landlord can prove the required intention on the evidence.
For valuation surveyors, Ground (g) cases can also affect valuation assumptions and negotiating positions, particularly where a tenant’s trading location is critical to value.
3) Lease terms on renewal – redevelopment break clauses and “rolling breaks”
A developing area in lease renewal disputes is the court’s willingness to include landlord redevelopment break clauses in renewal leases, including “rolling” break options in appropriate circumstances. This can materially affect tenant investment decisions (fit-out, capex and dilapidations planning) and should be addressed early in negotiations.
4) Holding / extent of premises – renewal may be limited to the occupied part
Recent commentary has highlighted disputes about the extent of the “holding” for renewal purposes, especially where the tenant occupies only part of the original demise at trial. From a practical perspective, tenants may consider whether partial occupation strategies can reduce exposure where a landlord’s works relate only to part of the premises.
Law Commission Reform Update (Security of Tenure)
The Law Commission has been consulting on modernising Part II of the 1954 Act, including whether the current contracting-out model remains fit for purpose, and potential alternatives (including contracting-in or other structural reform). For landlords and tenants, this is a key “watch this space” area that could reshape lease renewal strategy and documentation in the medium term.
Practical Takeaways for Landlords, Tenants and Valuation Surveyors
1) Evidence wins lease renewal cases: intention, funding, consents and programme should be documented.
2) Surveyor-led strategy should run in parallel with legal steps (section 25 / section 26) to avoid tactical drift.
3) Rent and terms should be prepared on a ‘court-ready’ basis early, with robust comparable evidence and clear assumptions.
4) If opposition is in play (Ground (f) or Ground (g)), test deliverability and credibility at the outset.
5) Consider the impact of redevelopment break clauses on business planning and valuation.
Need Advice on a Lease Renewal?
If you need professional support with a lease renewal under the Landlord and Tenant Act 1954—whether agreed or opposed—a specialist landlord and tenant surveyor can advise on strategy, evidence, rent, lease terms and (where required) expert witness support.
Our RICS Registered surveyors are able to produce a Market Rent Report and provide strategy advice.
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