ONE of the grounds that a landlord can object to the renewal of a business lease is if they can show that they intend to demolish or reconstruct the premises or carry out substantial work.

In the recent case of Inclusive Technology v Williamson, the landlord had served a Section 25 Notice terminating the tenancy and advising that it would be relying on the demolition or reconstruction ground.

The landlord advised the tenant in writing that it intended to carry out refurbishment work.

It came out in evidence that the landlord certainly had a genuine intention to refurbish the premises at the time the notice was served.

Some three months later, it appeared that the landlord had some concerns about how much the work was going to cost, and decided to do nothing at that stage, although he still intended to carry out the work at some point in the future.

This meant that the landlord no longer had an intention to carry out the works at the end of the tenancy.

However, the landlord did not advise the tenant of his change of mind, and, five months after the notice was served, the tenant moved out and signed a new lease at separate premises at a higher rent.

The tenant subsequently made a claim for compensation under Section 37A of the Landlord and Tenant Act 1954 that the landlord’s failure to tell the tenant about changes in his decision amounted to a misrepresentation.

The court awarded compensation to the tenant based on the difference of the rent it was paying for its new premises and the old rent.

While the court confirmed that, although there was no duty on the landlord to give updates as to the progress of any financial applications or planning applications if in fact the landlord no longer intends to carry them out, they must, however, at the end of the lease, inform the tenant of any changed circumstances or decisions.