Leases: Excluding security of tenure
A practice note that examines the concept of "contracting out" of the security of tenure provisions within the Landlord and Tenant Act 1954 (LTA 1954). This practice note outlines the meaning and effect of excluding a business tenancy from the statutory lease renewal rights afforded to tenants. It discusses when Part II of the LTA 1954 applies and the key exceptions, including licences and short-term leases. The note clarifies the essential requirement that a lease must be for a "term of years certain" to be validly contracted out. Furthermore, it explores the potential consequences of varying a contracted-out lease, highlighting how certain changes can result in a deemed surrender and regrant, which may unintentionally restore the tenant's security of tenure. This Practice Note also considers the commercial decision to contract out, referencing the Royal Institution of Chartered Surveyors' (RICS) Lease Code 2020 and the importance of addressing the issue in the initial heads of terms
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