Readers will be aware that any conditions attached to a break clause must be strictly observed. A recent case serves as a timely reminder that these conditions will usually include a requirement that vacant possession is given to the landlord.
The tenant had served a break notice and decided to carry out repairs to avoid a dilapidations claim. The works were not completed at the break date and two workmen remained in the property for a further six days. The tenant also employed a security guard for another week.
The Court of Appeal decided that the tenant had failed to give vacant possession. To do so:
- the property had to be empty of people;
- the landlord had to be able to enjoy immediate and exclusive occupation and control; and
- the property had to be empty of personal property (a few items that do not interfere with use may not be a breach).
The court found in favour of the landlord notwithstanding that the tenant's surveyor had requested a further period of time to finish off the works.
Faced with similar circumstances a tenant should vacate the property and deliver the keys back to the landlord on the break date. The tenant can then contact the landlord requesting permission to return to the property as a licensee.
Further details of the NYK Logistics (YK) Limited against Ibrend Estates BV (2011) case can be viewed here.