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Landlord and tenant – commercial

Drafting – ten-year trends?

A note from Eversheds Sutherlands notes some perceived changes in drafting approaches over the last decade or so:

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Rent review – time of essence?

Any rent review timescale must be strictly complied with. Moreover, even if there is no express time limit set out in the lease, the court may be willing to imply time limits for reasons of ‘business efficacy’ – with T then being able to serve a notice making time of the essence in respect of those implied (or even express) time limits. That much is well known.

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Electronic Communications Code – termination and removal

Under the old Code, landowners had to give operators just 28 days’ notice if they wanted to terminate a Code agreement. The new Code requires much longer notice – operators must be given 18 months’ notice just to terminate the Code agreement. But, it is important to note that termination is not the same as removal, and landowners must serve a separate notice specifying a ‘reasonable’ period for removal of the apparatus.

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Electronic Communications Code – LTA 1954

One welcome change in the new Code is that it addresses the uncertainty about whether or not LTA 1954 applies to Code agreements. Now, it is made clear that LTA 1954 rights do not apply to Code agreements (ie an agreement which has as its ‘primary purpose’ the grant of rights under the Code). This will mean that landowners will no longer have to run two sets of proceedings in parallel (ie under LTA 1954 and under the old Code). Instead, only one statutory regime will apply.

 

Electronic Communications Code – valuation

As noted above, there will be no financial benefit for a landowner if a telecoms operator is exercising its new right to share the site with another telecoms operator. But, this is merely part of the overall approach of the Code, which seems anxious to minimise the financial benefits to landowners of providing sites to telecoms operators. Note, in particular, that compensation and consideration payable by telecoms operators to landowners will now be calculated by reference (merely) to the open market value of the land – from the perspective of the landowner only. The value of the site to the operator, which could be quite substantial if it is a strategically important site, is wholly disregarded!

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Electronic Communications Code – upgrading and sharing

The new Electronic Communications Code was introduced (surprisingly) on 28 December 2017. One of the important changes is to increase the ability for operators to upgrade and share telecoms kit. Note that this is an automatic right granted to operators – it does not need to be included in the relevant agreement, or conferred by the court.

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Lease terms – anti-bribery?

A traditional, institutional, full repairing and insuring lease (FRI) is in relatively standard terms. The whole idea is that if the terms are relatively standardised then L’s reversion is an investment asset that can be bought and sold straightforwardly. Accordingly, deviations from those standard terms are frowned upon.

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Lease renewals – PACT

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Law Society – model office leases

The Law Society has published two short-form model office leases (one for the whole of a building, and the other for part). The leases are intended to be suitable for lettings of up to ten years, and include one rent review.

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Page 6 of 54

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