Is The Landlord and Tenant Act Still Fit For Purpose? Four Models Under Consideration

It is possible the 1954 Landlord and Tenant Act 1954 could be assigned to the rubbish heap - replaced with a framework better suited to the modern business world. The consultation specifically on the right to renew business tenancies (to which almost every business tenant in England and Wales is currently entitled) closed on 19 February.

The review is widely welcomed by the business community and lawyers who consider that the existing laws are no longer fit for purpose. The 1954 Act was last reviewed 20 years ago – since when the commercial and economic landscapes have altered significantly.

The consultation is in two parts, the first looking at security of tenure – the legal right, in certain circumstances, for business tenants to renew their tenancy when their existing tenancy ends Many consider that the right under the 1954 to security of tenure is no longer appropriate. It seems the Law Commission is taking those concerns seriously and has set out four potential options.

So what are these options?

• No security of tenure (abolishing the 1954 Act) – the landlord and tenant could still agree an option
• A contracting in regime – the L&T can opt in to give security of tenant
• A contracting out regime (the current position) – the L&T can opt out
• Mandatory security of tenure – compulsory security of tenure with no opt out agreement allowed

The Commission asked for responses from businesses and landlords; lawyers and other professionals; and further stakeholders as to which model they believe would best meet their needs.

PropertyMark, for example, says reform is necessary with the current system “slow and costly”. It would like to see a contracting in model for tenancies with leases of at least seven years; but with more flexibility for small and medium sized businesses which it believes should have the ability to negotiate security of tenure where needed.

What’s next?

The Law Commission will review the responses and make recommendations on a model of security of tenure, followed by a second consultation concerning how it should work. The next consultation is due later this year.

For more about the review and the problem areas under review, join our in-person LAW2025 events happening this spring and autumn. Discover our in-person events here.

The consultation document and summary can be accessed here: https://lawcom.gov.uk/consultation-on-right-to-renew-business-tenancies-published/