commercial leases lecture 3

Jennifer Slade

Commercial lease draftingStandard forms/precedentsExamples“Lease anatomy”Code of Practice for Commercial

LeasesLease of part and of wholePrescribed clauses

Drafting for the landlord Control of premises Marketability/investment value Standard lease for development

▪ Exceptional tenants▪ Confidentiality – EID’s

Tenant’s amendments Flexibility, rent review, onerous provisions,

marketability

Draft for certainty

Defined terms and interpretation clause Use of schedules

Definitions in schedules Punctuation and layout Clause numbering, e.g.:

Clause 2.1.3.4 Clause 2(1)(c)(iv) Clause 2.1(c)(iv)

Firms’ precedents Updating Client specific

Law Society Business Lease BPF – model clauses Other precedents: Lexis Nexis, Practical

Law

Construction of lease provisions

Gateshead lease (1964) vs Billies Cookies lease (1999)

Gateshead lease – consider: term – expiry? Clause 4 Clause 5 Clause 6 Plan Easy to read? Easy to find information?

Consider Billies Cookies lease

Comments/comparison?

How could drafting style of Billies Cookies lease be improved?

What are the principal provisions, and where would you find them?

Code of Practice for Commercial Leases

What is the purpose of a lease report? For assignee For purchaser of reversion

Anatomy of a Simple Commercial Lease:

Date, Parties

Definitions, Interpretation

Demise (habendum, reddendum)

TENANT’S COVENANTS- repair, alienation, user, alterations, etc

Landlord’s Covenants

Provisos

SCHEDULES- premises, - rights, reservations- rent review- service charge

What is the difference in structure between a lease of whole and a lease of part? Multi-lets Service charge Common parts Insurance

Unit 1

Unit 2

Unit 3

w.c.

COMMUNAL

AREA

Land Registry Prescribed Clauses Leases Necessary from 19 June 2006 for registrable

leases – if not, Land Registry rejects Prescribed clauses LR1 – LR14 Only front sheet and index can precede

prescribed clauses – particulars pages must come after

Note Property prescribed clause – LR4 Prescribed clause overrides any other

definition See precedent in recommended text