MAKE YOUR FREE Tenant’s Agreement to Exclude Security of Tenure
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What is a Tenant’s Agreement to Exclude Security of Tenure?
A Tenant’s Agreement to Exclude Security of Tenure is an agreement between a commercial landlord and commercial tenant to exclude security of tenure from a Commercial lease. If security of tenure is not excluded from a lease, the tenant has the right to remain in the property after the end of the original lease.
Agreements to Exclude Security of Tenure should be made in response to Landlords' notices to exclude security of tenure and need to be made and signed before commercial leases are signed.
For use in England and Wales only.
When should I use a Tenant’s Agreement to Exclude Security of Tenure?
Use this Tenant’s Agreement to Exclude Security of Tenure:
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for a lease of business premises where security of tenure is not being given
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where a Landlord's warning notice has been served
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when either a tenant's simple declaration or statutory declaration is required
Sample Tenant’s Agreement to Exclude Security of Tenure
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TENANT'S AGREEMENT TO EXCLUDE SECURITY OF TENURE
I, declare that -
- (the Tenant) proposes to enter into a tenancy of premises known as , for a term commencing on .
- The Tenant proposes to enter into an agreement with (the Landlord) that the provisions of sections 24 to 28 of the Landlord and Tenant Act 1954 (security of tenure) shall be excluded in relation to the tenancy.
- The Landlord has served on the Tenant a notice in the form, or substantially in the form, set out in Schedule 1 to the Regulatory Reform (Business Tenancies) (England and Wales) Order 2003. The form of notice set out in that Schedule is reproduced below.
- The Tenant has read the notice referred to in paragraph 3 above and accepts the consequences of entering into the agreement referred to in paragraph 2 above.
IMPORTANT NOTICE
You are being offered a lease without security of tenure. Do not commit yourself to the lease unless you have read this message carefully and have discussed it with a professional adviser.
Business tenants normally have security of tenure - the right to stay in their business premises when the lease ends.
If you commit yourself to the lease you will be giving up these important legal rights.
- You will have no right to stay in the premises when the lease ends.
- Unless the landlord chooses to offer you another lease, you will need to leave the premises.
- You will be unable to claim compensation for the loss of your business premises, unless the lease specifically gives you this right.
- If the landlord offers you another lease, you will have no right to ask the court to fix the rent.
It is therefore important to get professional advice - from a qualified surveyor, lawyer or accountant - before agreeing to give up these rights.
If you want to ensure that you can stay in the same business premises when the lease ends, you should consult your adviser about another form of lease that does not exclude the protection of the Landlord and Tenant Act 1954.
If you receive this notice at least 14 days before committing yourself to the lease, you will need to sign a simple declaration that you have received this notice and have accepted its consequences, before signing the lease.
But if you do not receive at least 14 days notice, you will need to sign a "statutory" declaration. To do so, you will need to visit an independent solicitor (or someone else empowered to administer oaths).
Unless there is a special reason for committing yourself to the lease sooner, you may want to ask the landlord to let you have at least 14 days to consider whether you wish to give up your statutory rights. If you then decided to go ahead with the agreement to exclude the protection of the Landlord and Tenant Act 1954, you would only need to make a simple declaration, and so you would not need to make a separate visit to an independent solicitor.
About Tenants' Agreements to Exclude Security of Tenure
Learn more about making your Tenant's Agreement to Exclude Security of Tenure
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How to make a Tenant's Agreement to Exclude Security of Tenure
Making a Tenant's Agreement to Exclude Security of Tenure online is simple. Just answer a few questions and Rocket Lawyer will build your document for you. When you have all of the details prepared in advance, making your document is a quick and easy process.
To make your Tenant's Agreement to Exclude Security of Tenure you will need the following information:
Party details
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What are the tenant’s details (eg legal structure, name and address)?
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If the tenant is a company, LLP or partnership, who will sign the Agreement on the tenant’s behalf?
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What are the landlord’s details (eg legal structure, name and address)?
Lease
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What is the address of the property the landlord is letting to the tenant?
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On what day will the commercial tenancy start?
Declaration
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What type of declaration does the tenant need to send?
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Common terms in a Tenant's Agreement to Exclude Security of Tenure
A Tenant's Agreement to Exclude Security of Tenure communicates your acceptance of a landlord’s request to contract out of security of tenure. To achieve this, this Tenant's Agreement to Exclude Security of Tenure covers:
The Agreement itself
The body of the Tenant's Agreement to Exclude Security of Tenure outlines that you are willing to exclude security of tenure from your commercial lease and that you understand what this means for you as a commercial tenant. The body of the Agreement covers certain declarations in relation to excluding security of tenure, including:
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that you wish to enter into a commercial lease starting on a specified date
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that you understand that security of tenure will be excluded from this lease
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that the landlord served a notice to exclude security of tenure
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that you accept the consequences of entering into the lease without security of tenure
Important notice
This part of the Tenant's Agreement to Exclude Security of Tenure sets out details relating to the exclusion of security of tenure. These details include:
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highlighting that the commercial lease is being offered without security of tenure
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information about the legal rights the commercial tenant is giving up by entering into a lease without security of tenure
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encouraging the tenant to seek professional advice (eg from a qualified surveyor, lawyer or accountant) before signing the commercial lease
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the steps required for the tenant to commit themselves to the commercial lease (this will depend on whether the commercial tenant is receiving 14 days’ notice of the exclusion of security of tenure)
Signatures
Due to the nature of this Tenant's Agreement to Exclude Security of Tenure, it must be physically signed. Depending on when the landlord’s notice was received, this may need to be done in front of a solicitor or commissioner for oaths. The signature section of this Agreement contains the relevant signature blocks to make the Tenant's Agreement to Exclude Security of Tenure as either a simple or statutory declaration.
If you want your Tenant's Agreement to Exclude Security of Tenure to include further or more detailed provisions, you can edit your document. However, if you do this, you may want a lawyer to review or change the Tenant's Agreement to Exclude Security of Tenure for you to ensure it complies with all relevant laws and meets your specific needs. Ask a lawyer for assistance.
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Legal tips for making a Tenant's Agreement to Exclude Security of Tenure
Understand the consequences of excluding security of tenure
Security of tenure gives commercial tenants the right to get a new lease for commercial premises (like warehouses or offices) even after their original lease comes to an end. A commercial landlord who hasn’t excluded security of tenure from a commercial lease can only prevent a commercial tenant from remaining in the premises in reliance on certain strict legal grounds (eg because there have been repeated delays in the tenant paying rent or the tenant has failed to keep the property in good repair). By excluding security of tenure from your commercial lease you lose the automatic right to a new lease for the premises. You also lose the right to claim compensation for the loss of business premises (unless your lease grants you such a right). For more information, read Security of tenure.
Make sure the Tenant's Agreement to Exclude Security of Tenure is signed correctly
You need to ensure that the Tenant's Agreement to Exclude Security of Tenure is properly executed (ie made and signed). What this process will entail depends on how much notice you are given of your landlord’s wish to exclude security of tenure from your commercial lease. As a general rule, if you’re given more than 14 days’ notice you can sign your Agreement as a simple declaration. If you are given less than 14 days’ notice, you must sign your Agreement as a statutory declaration, the process for which is more onerous and involves more formalities than a simple declaration. For more information, see the FAQs ‘What is a simple declaration to exclude security of tenure?’ and ‘What is a statutory declaration to exclude security of tenure?’.
Understand when to seek advice from a lawyer
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if there are multiple landlords or tenants
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if you need urgent access to the property
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where you have to provide a guarantor under the lease
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for property located in Scotland
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Tenant's Agreement to Exclude Security of Tenure FAQs
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What is included in a Tenant’s Agreement to Exclude Security of Tenure?
This Tenant’s Agreement to Exclude Security of Tenure template covers:
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the required legal information that must be provided in response to the Landlord’s notice to exclude security of tenure
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the tenant's simple declaration or statutory declaration to exclude security of tenure from their commercial lease
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Why do I need a Tenant’s Agreement to Exclude Security of Tenure?
You should use a Tenant’s Agreement to Exclude Security of Tenure after receiving a notice from your landlord seeking to exclude security of tenure from your commercial lease (eg using a Landlord's notice to exclude security of tenure).
By contracting out of security of tenure, you (as the commercial tenant) do not have the automatic right to extend your commercial lease once its original term comes to an end. By making, signing and sending a Tenant’s Agreement to Exclude Security of Tenure, you communicate your agreement to contract out of security of tenure. You also confirm that you understand the implications of entering a lease without security of tenure under sections 24 to 28 of the Landlord and Tenant Act 1954.
If your intended commercial landlord wants to exclude security of tenure, and you do not agree, you should speak to your landlord. You may be able to negotiate with them to come to a decision that works for you. However, if you cannot agree on security of tenure, you may not be able to reach an agreement and enter into a Commercial lease.
For more information, read Security of tenure.
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What is a simple declaration to exclude security of tenure?
A simple declaration is a type of Tenant’s Agreement to Exclude Security of Tenure, which can be made if you received at least 14 days’ notice of the landlord’s intention to exclude security of tenure from your commercial lease. In other words, you must have received your Landlord's notice to exclude security of tenure at least 14 days before the date on which you’re intending to sign the commercial lease.
Where this is the case, your Tenant’s Agreement to Exclude Security of Tenure can be signed as a simple declaration. This involves fewer formalities than a statutory declaration as you only need to print, sign and date your Agreement. For more information, read Security of tenure and see our Make it legal checklist.
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What is a statutory declaration to exclude security of tenure?
A statutory declaration is a type of Tenant’s Agreement to Exclude Security of Tenure which can be made if you receive less than 14 days’ notice of the landlord’s intention to exclude security of tenure from your commercial lease. In other words, you need to make your Tenant’s Agreement to Exclude Security of Tenure as a statutory declaration if you receive the Landlord's notice to exclude security of tenure less than 14 days before signing the commercial lease.
Signing your Tenant’s Agreement to Exclude Security of Tenure as a statutory declaration involves more formalities than signing it as a simple declaration. Specifically, you must sign the Agreement in front of a solicitor or other party who can swear oaths (ie a commissioner for oaths). For more information, read Security of tenure and see our Make it legal checklist.
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