Section 25 Notice

What is a Section 25 Notice?

A Section 25 notice, applicable in England and Wales, is a statutory notice served by a landlord to terminate a business tenancy. It's a provision under the Landlord and Tenant Act 1954, which governs the relationship between landlords and their commercial tenants.

The notice informs the tenant that the landlord either wishes to end the tenancy or proposes new terms for a renewed lease.

Benefits of a Section 25 Notice:

Control for Landlords:

Landlords can use the Section 25 notice to end a business tenancy, either because they have alternative plans for the property, such as redevelopment or sale, or because they want to change the terms of the lease.

It provides a clear legal framework for landlords to regain possession of their commercial property.

Opportunity for Negotiation:

If a landlord does not oppose the renewal but wants to change the tenancy's terms, serving a Section 25 notice provides an opening for negotiations between the tenant and landlord for a new lease agreement.

Protection for Tenants:

A Section 25 notice can't be given arbitrarily. The landlord must either not oppose the grant of a new lease or have statutory grounds for opposition. This offers tenants some degree of security in their tenancy.

The notice provides a clear indication to the tenant about the landlord's intentions, allowing them to make informed decisions about their business's future.

Clear Timeframes:

The Section 25 notice sets clear timeframes. Typically, it must be served between 6 and 12 months before the date on which the landlord proposes to end the tenancy. This gives the tenant ample time to prepare, either by negotiating new terms, seeking a new commercial space, or challenging the notice if they believe it's not valid.

Certainty in Business Relations:

By formalising the process of lease termination and renewal, the Section 25 notice ensures clarity and certainty in commercial landlord-tenant relations. Both parties are aware of their rights and responsibilities, minimising the potential for disputes.

Structured Grounds for Opposition:

If the landlord opposes a new lease, they must have a valid reason under the provisions of the Landlord and Tenant Act. This structured approach ensures that tenants are not evicted without cause.

In essence, a Section 25 notice serves as a structured and legally recognised method of communication between a commercial landlord and tenant, balancing the rights and needs of both parties.