Q&As

What is the position as to the demise/legal ownership of a building on renewal of a lease of bare land where the tenant subsequently erected a building at its own cost with landlord’s consent though this was not documented?

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Produced in partnership with Helen Galley of XXIV Old Buildings
Published on LexisPSL on 04/02/2019

The following Property Q&A produced in partnership with Helen Galley of XXIV Old Buildings provides comprehensive and up to date legal information covering:

  • What is the position as to the demise/legal ownership of a building on renewal of a lease of bare land where the tenant subsequently erected a building at its own cost with landlord’s consent though this was not documented?
  • Business Lease
  • House

What is the position as to the demise/legal ownership of a building on renewal of a lease of bare land where the tenant subsequently erected a building at its own cost with landlord’s consent though this was not documented?

It is assumed that:

  1. the lease was not a building lease, ie one under which the tenant was under an obligation to erect the building in question;

  2. there is no tenant covenant to reinstate the building

Business Lease

If the building as erected is used by the tenant for the purposes of a business carried on by them, it will form part of the tenant’s demise and the lease will be one to which, at its expiry even if not when initially granted, the provisions of Part II of the Landlord and Tenant Act 1954 (LTA 1954) will apply. Assuming in that case that the landlord serves a LTA 1954, s 25 notice indicating that they have no objection to a new lease or any objection they have is defeated or the tenant serves a LTA 1954, s 26 request for a new lease and the landlord responds offering a new lease the issue will be what impact does the existence of the building have on the rent payable or other terms of the lease.

The fact that the tenant has expended their own money on the erection of

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