Background to the Landlord & Tenant Act 1954

The Landlord & Tenant Act 1954 ("The Act") was brought in to give commercial tenants security of tenure. Expiring contractual business tenancies were automatically extended by the Act unless and until brought to an end in accordance with the formal notice procedures contained in the Act. Even when the formal notice procedures were complied with, the tenant could apply to the Court for a new lease for a term of up to 14 years unless the landlord objected on statutory grounds; eg tenant was a bad tenant by failing to comply with his obligations/failing to pay the rent; landlord wanted the premises for his own use; or landlord wanted to refurbish or redevelop the premises. If the tenant's rights ceased on the grounds of the latter two, compensation would be payable by the landlord. The Act was amended in 1969 when the parties were permitted to exclude the Act, by mutual agreement that had been approved by the Court.

Proposed revisions

In 1992 the Law Revision Commission proposed that the legislation be streamlined in a number of ways, including simplifying the notice procedures and removing the need for a Court Order to approve exclusion of the Act. However, these proposals have never become law.

The last decade has seen significant changes in the commercial lease. The Commercial Property Leases in England and Wales Code of Practice (published in December 1995) has been adopted and the Landlord & Tenant (Covenants) Act 1995 terminated the automatic liability of the tenant for the whole of the lease term, even where there had been alienation by the tenant. At the same time shorter lease terms have become common and increasing numbers of tenancies have been contracted out of the 54 Act.

Legislative controls over residential and agricultural lettings which reached the statute book at more or less the same time as the 54 Act have largely disappeared for new lettings. If restrictive controls are not required for residential and agricultural lettings, it is now asked, why should they still be required for commercial lettings? Also, the Act never applied to Scotland and there is no proposal to make it apply to Scotland. Why should it therefore still apply to England and Wales?

A number of landlords and tenants have now put forward the view that the Act should not be streamlined as proposed in 1992, but repealed altogether for new lettings.

For further information on this topic, please contact Charles Romney at [email protected] or on +44 (0)20 7367 2727.