Disputes over possession of commercial property can be complex and commercially sensitive. Whether you’re a landlord seeking to regain possession or a tenant facing eviction, understanding your legal rights is essential.
Unlike residential property, commercial possession rights are largely governed by lease terms and commercial property law. Mistakes in this area can lead to delays, financial loss and further disputes.
In this guide, we outline what commercial property possession rights are, when a landlord can seek possession and what tenants should be aware of. We also explain how to arrange a free 30-minute consultation with a commercial property dispute solicitor to discuss your position.
What are commercial property possession rights?
Commercial property possession rights refer to the legal ability of a landlord to regain possession of a commercial premises or a tenant’s right to remain in occupation, depending on the circumstances.
These rights are primarily determined by the terms of the commercial lease, supported by statutory protections where applicable. Possession disputes commonly arise at the end of a lease term or following an alleged breach of lease conditions.
Because commercial leases vary widely, possession rights can differ significantly from one property to another.
When can a landlord seek possession?
A landlord may seek possession of a commercial property in several situations. One common scenario is when the lease has expired and the tenant has no right to remain in occupation.
Possession may also be sought where a tenant has breached the lease, such as by failing to pay rent, breaching repair obligations or using the property in an unauthorised way. In these cases, the landlord must usually follow a specific legal process before taking action.
In some circumstances, a landlord may also seek possession for redevelopment or personal occupation, particularly where the lease is protected under the Landlord and Tenant Act 1954 and the landlord relies on statutory grounds to oppose renewal.
Security of tenure and the Landlord and Tenant Act 1954
Security of tenure is a key issue in commercial possession disputes. Where a lease is protected by the Landlord and Tenant Act 1954, tenants may have the right to remain in occupation and renew their lease when it expires.
This protection means a landlord can’t simply recover possession at the end of the lease term unless they can establish one of the statutory grounds for opposition. These grounds include redevelopment, owner occupation or persistent breaches by the tenant.
Not all commercial leases benefit from this protection. Some leases are contracted out of the 1954 Act, meaning the tenant has no automatic right to stay once the lease ends. Understanding whether security of tenure applies is critical.
Forfeiture and peaceable re-entry
Forfeiture is one of the main ways a landlord can regain possession of commercial property during the term of a lease. It allows a landlord to end the lease early if the tenant has breached its obligations.
Common breaches include non-payment of rent, unauthorised alterations or failure to comply with repair obligations. However, forfeiture is subject to strict rules and, in many cases, requires the landlord to serve a formal notice before taking action.
Peaceable re-entry allows a landlord to retake possession without court proceedings, usually by changing the locks when the property is vacant. This method carries risks and must be handled carefully to avoid unlawful eviction claims.
Court proceedings for possession
Commercial possession disputes can escalate quickly and have serious financial consequences. Taking action without understanding the legal framework can expose parties to significant risk.
Where peaceable re-entry isn’t appropriate or has failed, landlords may need to apply to the court for a possession order. Court proceedings can be time-consuming and costly but may be necessary in contested cases.
Tenants may have defences available, such as applying for relief from forfeiture. This can allow a tenant to regain possession if they remedy the breach, particularly in cases involving rent arrears. Relief from forfeiture is a key safeguard that allows tenants to apply to the court to have the lease reinstated after forfeiture.
Courts will consider factors such as the seriousness of the breach, whether it has been remedied and the overall fairness of granting relief. Acting quickly is often crucial for tenants seeking to protect their position.
Understanding the court process and the potential outcomes is essential for both landlords and tenants. Tenants may also have rights under the lease or statute that affect possession proceedings, particularly where security of tenure applies.
Speak to a commercial property dispute solicitor about possession rights
If you’re facing a commercial property possession dispute or need advice on regaining or protecting possession, professional guidance can help you understand your rights and options.
A commercial property dispute solicitor can advise on possession rights, ensure the correct procedures are followed and help resolve disputes efficiently, whether through negotiation or court proceedings.
Please note that this article is solely for informational purposes. It’s not a substitute for legal advice. We encourage readers to contact Osbourne Pinner for case specific guidance.
We offer a free 30-minute consultation to discuss your situation. You can speak with us via video call or visit our offices in Harrow, Canary Wharf, Piccadilly Circus or Manchester. To arrange your consultation, call 0203 983 5080, email [email protected] or complete the form below.
