The Pubs Code and unopposed lease renewals under the 1954 Act
Rob Hastie, 1st February, 2018
A tenant who has the protection of the Landlord and Tenant Act 1954 has the right at the end of their term to seek a new tenancy. The landlord has the right to oppose the grant of that new tenancy on one of the statutory grounds. This article looks at what happens if the landlord does not oppose the renewal of a lease where the tenant has the protection of the Pubs Code.
The tenant can only get a tied lease through the courts, not a free of tie lease. The right to go free of tie is through the procedure in the Pubs Code. In other words the 1954 Act proceedings are separate and distinct from the MRO proceedings. The tenant will not succeed with an argument in the courts that freeing the tie is a ‘reasonable modernisation’ of the existing tied lease terms.
The Civil Procedure Rules Part 56 practice direction has been amended to deal with the Pubs Code:
a. The statement of claim and acknowledgment of service must make clear that the lease is covered by the Pubs Code, whether an MRO claim is proceeding and whether there has been a request for a rent proposal.
b. Where an MRO notice has been served neither the landlord nor the tenant have to “show their hand” by setting out their preferred tied lease terms in their Statement of Claim or Acknowledgment.
c. Most unopposed claims will be stayed by the court if there is an MRO claim ongoing.
d. There is an obligation for the Claimant to inform the court within 28 days of the conclusion of the MRO claim.
Checklist for landlords on unopposed renewals:
| Stage: | Action: |
|---|---|
| More than 6 months out: | Get schedule of dilapidations prepared. |
| 12-6 months out: | Serve s.25 |
| If requested by tenant: | Serve rent proposal within 21 days. |
| If T or L carrying out works: | Update Schedule of Condition. |
| In proceedings: | Ensure statement of claim/acknowledgment of service includes wording from Practice Direction 56: |
| state that the tenant is a Pubs Code tenant. | |
| state whether the tenant has given an MRO notice and/or has requested a rent proposal. | |
| Before completion: | Advise T of benchmarking reports. |
| Advise T to get Pubs Entry Training. | |
| Take into account schedule of condition. | |
| On completion of MRO claim: | Tell court within 28 days that the MRO procedure is at an end and: |
| If MRO lease granted, send consent order to end court action. | |
| If MRO lease not taken up, agree directions for 1954 Act claim |
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