Business Lease Agreement

This document that can be used to create a simple business lease. This lease is for use in England and Wales only. Different formats must be used for Northern Ireland or in Scotland. It can be used for shops, offices or light industrial units, such as warehouses or workshops.

This document should not be used:

• where the property a residential property (i.e it is to be lived in). A different sort of lease should be used for residential purposes.
• as a subletting agreement.
• where the lease is intended for a period of longer than seven years. These types of leases require more complicated terms.

The document is therefore suitable for a short-term business lease. The lease sets out the rights and responsibilities of both the landlord and tenant.

Most businesses leases have a high security of tenure, meaning that the lease shall automatically renew and business tenants usually have the right to remain in the property after the end of the allotted lease term. Where this is not desirable, it is possible for the parties to contract out of this position (as per sections 24-28 of the Landlord and Tenant Act 1954). This process must be undertaken via a separate agreement, which shall then be referred to within this lease document. The process will not generally be necessary where the lease is for a term of less than 6 months.

How to use this document

The document should be provided to all parties who are named within it. All parties should be given an opportunity to read and agree to its contents. Where the parties agree on the terms of the contract, they should sign a copy, or a copy and counterpart if necessary.

It is recommended that the document is executed as a deed. Leases for a term of more than three years must be executed via a deed. However, where the lease contains certain other rights (for example rights relating to access etc), those rights will only be effective where the document is executed through a deed. It is therefore best to execute the document in this manner.

Deed execution requirements

For a party that is a company, a deed must be executed by either:

• the signature of two authorised signatories (i.e two of its directors or one director and the company secretary); or
• the signature of one director in the presence of one witness who attests the director's signature; or
• the affixing of the company's common seal upon the document.

For a party that is a Limited Liability Partnership (LLP), a deed must be executed by either:

• the signature of two members of the LLP; or
• a single member of the LLP in the presence of an attesting witness; or
• the affixing of its common seal.

Where the parties are partners of a general or limited partnership, a deed should be executed by the witnessed signature of all partners.

Where a party is a singular individual (such as a sole-trader) a deed must be executed by either:-

• the donor signing the document in the presence of a witness who attests their signature; or
• the donor directing the signature of the document, which then must be signed in the donor's presence and in the presence of two witnesses who each attest the signature. This option may be selected where the donor is not physically able to sign the document due to a physical impairment, for example.

Process for excluding security of tenure

Where the parties are agreeing to contract out of the security of tenure provisions contained in sections 24 to 28 of the Landlord and Tenant Act, this process should be taken prior to the lease completing. The method which the tenant must use to sign the agreement will depend upon the amount of notice they receive from the landlord prior to the lease or agreement for lease completing. Where:

(A) the notice is sent by the landlord less than 14 days prior to the lease completing or before an agreement for lease is completed (usually completion will take place where the landlord and tenant(s) have signed the lease and all sums payable have been made), the declaration must be made through a statutory declaration on behalf of the tenant. A statutory declaration is a written statement of fact that is signed by a person who holds the power to make a statutory declaration (usually a solicitor or a Commissioner for Oaths);

(B) the notice is sent by the landlord more than 14 days prior to the lease completing or before an agreement for lease completing, the tenant can simply sign the agreement.

If this process does not occur, the tenant may be able to extend the lease even if the landlord does not agree.

After completing

Both parties should retain copies of the lease and any other relevant documents. On the specified date of the lease, the tenant should pay their first instalment of rent, and any deposit, in accordance with the agreement, before the tenant takes possession of the property. Payments of rent should be received in accordance with the lease for it to continue to operate.

Thereafter, where the tenant experiences any issues regarding the lease, a formal complaint should be made.

Relevant law

• The Land Registration Act 2002
• The Landlord and Tenant Act 1954
• The Law of Property Act 1925
• Law of Property (Miscellaneous Provisions) Act 1989
• The Companies Act 2006
• The Partnership Act 1890
• The Limited Liability Partnerships (Application of Companies Act 2006) Regulations 2009
• The Regulatory Reform (Business Tenancies) (England and Wales) Order 2003
• The Statutory Declarations Act 1835

Help from a lawyer

You can choose to consult a lawyer if you need help.

The lawyer can answer your questions or help you through the process. You will be offered this option when you complete the document.

How to modify the template

You fill out a form. The document is created before your eyes as you respond to the questions.

At the end, you receive it in Word and PDF formats. You can modify it and reuse it.