A version of this article was first published on our website in May 2021
Whether you’re a business tenant or rent out commercial property, disputes can arise over continued occupation, damage to the business premises or breaches of a repairing covenant.
What could cause a commercial property dispute?
Depending on the lease agreed, there are many issues that cause disputes, but here are the most common.
Continued occupation of the property
For example, you must follow the correct legal procedures if you want a tenant to leave. This includes sending the correct legal notices and complying with legally imposed timeframes.
If you’re a business tenant and want to extend your lease, you’ll need to follow procedures too, ensuring that you don’t undermine any legal rights that your lease or the law provides to you.
Property-related disputes with neighbours
If you own commercial property, you may end up in disagreements concerning the boundaries of both properties or legal rights connected to one of the properties, such as right of way.
“I have been an FSB member for 3 years and this is the first time I have used the legal services. I have recently purchased a commercial property that was a tenement, and it’s connected to a basement flat and upper floor flat. My neighbour had been disputing my access to the property and siding with the other residents with regard to the business’ air conditioning units. It has been an extremely stressful time but I’m so glad I called the legal claims line and was told that there was cover under the legal protection insurance policy to make a claim for nuisance to my commercial premises.”
Condition of the property
Both tenants and landlords typically have obligations to ensure that the property is looked after and remains in a good state. Despite the wording of lease terms, if a property falls into disrepair, disagreements can arise regarding:
- who is responsible for the repairs
- when the repairs should take place
- how the repairs are carried out
- the cost of carrying out the repairs
If a commercial property is in disrepair, there will need to be an analysis of what should be done to come to a resolution.
What is a repair covenant?
A lease will normally require the tenant to keep the property in repair as part of the agreement (known as the covenant). The specifics of what is expected, and whether there is a service charge for the upkeep of any communal areas, should be outlined in the lease. If there is a breach of this by either party, it could lead to legal action.
Dealing with a dispute on top of the day-to-day running of your business can be stressful and time-consuming. This is how an FSB member was able to make a claim for a breach of a repairing covenant and relieve the pressure.
What happened?
"I run a retail business and spent a considerable amount of money decorating before moving into my new premises. Not long after the refurbishment, there was major egress through the window resulting in significant water damage. I was devasted and had to close the business for a day, but a further flash flood resulted in damaged stock. The landlord blamed it on a blocked grate that leads to the downpipe that overflowed. It says in the lease that the landlord is responsible for the outside of the building."
How did FSB help?
"I have used the legal advice line many times but never had to make a claim under the legal protection insurance policy until now. With FSB’s help, I was able to make a claim for a breach of a repairing covenant in the lease and don’t have to worry about further water damage."
What extra protection is available for FSB members?
With FSB Legal Protection Scheme, FSB members can access legal representation for pursuing third parties for nuisance or damage to the business premises or for a breach of a repairing covenant in a lease.