been served effectively. The wording ‘at any time’ was clear and unambiguous and to imply that this should have been ‘reasonable’ would go against the express terms of the lease. In another recent case, a break clause gave
the tenant the option of two different break dates. One of the conditions was that the tenant must give vacant possession to the landlord on the relevant break date. The tenant exercised the break clause on the
second break date and subsequently removed key features of the premises including ceiling tiles, lighting and heating. The landlord argued that the tenant had not given vacant possession of the premises as the definition of ‘premises’ included ‘all fixtures and fittings at the premises whenever fixed’. The court found that the break clause had
been exercised effectively. There was no requirement for the tenant to comply with the other covenants of the lease in order for the break clause to operate, and, therefore, they were only required to return the premises as they were on the break date free of people, chattels and interests. In a slightly older case (but still relevant
nonetheless), a tenant brought a claim for the court to determine the exact conditions of a break clause which stated that the tenant could end the lease at the twentieth year of the term on not less than 12 months’ notice subject to the tenant giving vacant possession. A subsequent clause stated that on expiration of the notice, the tenant should yield up the premises in accordance with clause 11 (which stated that any alterations must be removed and the property reinstated). T e court found that on the natural and ordinary meaning
of the break clause, there was only one condition: vacant possession. If the landlord had wanted strict compliance with clause 11 as a condition for the break, this should have been made clearer in the break clause itself.
So, our top tips for a clean break? - Be clear on your conditions and understand what they mean in real life - Don’t leave room for ambiguity in the drafting (or better still ensure that your lawyer does not leave ambiguity in the drafting) - Make sure that the break clause (and any associated conditions) clearly refl ects the intentions of both parties
Howes Percival’s commercial property solicitors provide a full range of services for landlords and tenants including commercial leases, property portfolio management and dispute resolution. For more information, contact Marcus Carter on 07814 356928 or at
marcus.carter@
howespercival.com
ALL THINGS BUSINESS
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