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propertylawyer, Solicitor
Category: Property Law
Satisfied Customers: 288
Experience:  Property solicitor with expertise in commercial and residential property transactions.
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We have been renting an industrial unit for the last 12

Customer Question

Hello, we have been renting an industrial unit for the last 12 years paying rent in the standard quarters. Unfortunately a couple of week ago (at the beginning of September) we lost our biggest client which has effectively closed our business. The business has a big overdraft and we can not afford to pay another quarters rent which would be due at the end of September. We have told the landlords agents that we cannot continue with the lease as we will have no money to pay the rent and that we would vacant at the end of September. We did not signed the renewal contract three years ago. We cannot remember how much deposit we paid 12 years ago. My questions are: can they withhold our deposit in lieu of notice even though we haven't signed a contract? They are saying they want the unit left in the same condition in which we rented it when in actual fact it was in an appalling state - so much so that the agents gave us a free month to work on it to bring in into being habitable. In such a circumstance what would be an 'acceptable condition'. Many thanks
Submitted: 1 year ago.
Category: Property Law
Expert:  propertylawyer replied 1 year ago.


Thanks for your question.

As your original lease has ended and have not signed the renewal lease you can potentially serve notice. It will depend if you had a protected tenancy and have been holding over on those terms or had an unprotected tenancy but have been occupying since the end if that tenancy on periodic tenancy terms.

Without further details, sight of documents I cannot comment further on the validity of your notice.

If you have served a valid notice and pay rent up to the end if the notice then the landlord has no claim on the deposit in respect of arrears or loss of Rent.

As for dilapidations, the standard obligation is for full repair. This means that you have to put the property into repair, I.e remedy historical dilapidations unless your lease has a schedule of condition attached and specific wording that you are not required to put it into a better state of repair and condition as evidenced by the schedule. It is one of the extremely unfair terms a tenant is subject to when taking a lease.

Potentially you are liable to repair and remedy historical dilapidations.

Generally the acceptable condition required by landlords is old for new, full renovation back to new condition.

Your deposit can be taken to cover part of any dilapidations claim brought against you.

Do you have any questions or queries?

Happy to assist further.

Customer: replied 1 year ago.
Thanks It's a standard Law Society lease, is that an unprotected tenancy?
Expert:  propertylawyer replied 1 year ago.

It depends. I have seen such leases being protected and excluded.