Break clauses conditional on payment of outstanding rent
Break clauses conditional on payment of outstanding rent

The following Property guidance note provides comprehensive and up to date legal information covering:

  • Break clauses conditional on payment of outstanding rent
  • Break date between rent payment dates or on a rent payment date
  • Recovering overpaid rent

Break conditions must be strictly complied with. If a condition provides that any outstanding rent is paid up, the tenant must make sure that it is paid in full and on time. This type of condition is also referred to as a ‘pre-condition’, or a ‘condition precedent’ to the break operating. The tenant would be well advised, therefore, to request an invoice well in advance, together with the landlord’s bank details if payment is to be made directly.

From a practical perspective, if the landlord refuses to provide an up-to-date invoice for all outstanding rents, and is not under any enforceable obligation to do so (assuming there is sufficient time before the break to enforce that obligation), the tenant will need to work out the outstanding amount for themselves. The tenant should take a prudent approach in that regard, ie if there is doubt as to the amount payable it may be preferable to overpay in order to avoid the risk of the break option not operating. Care should be taken to ensure that all sums provided for under the pre-condition are taken into account, for example ‘rents’ under the definition in the lease may include insurance premiums and other sums. However, any such payment should be made expressly without prejudice to the tenant’s right to reclaim any monies paid over and