Ground (f) of the Landlord and Tenant Act 1954 (the Act) is a frequently used legal mechanism by landlords to oppose a tenant’s lease renewal.
This provision allows a landlord to refuse a new lease if they intend to demolish or reconstruct the property, or carry out substantial work on it. However, as recent case law has demonstrated, relying on Ground (f) is not without its challenges.
In this article, Surrey-based Lease Advisory expert Frank Perri explores Ground (f), its implications, and what landlords and tenants can learn from two high-profile legal battles.
Understanding Ground (f) of the 1954 Act
The Act provides commercial tenants with security, ensuring they can request a lease renewal when their current lease expires unless a landlord successfully opposes it under Section 30(1).
Ground (f), found in Section 30(1)(f) of the Act, allows landlords to oppose renewal on the basis that they intend to demolish or reconstruct the premises. However, for this argument to succeed, the landlord must demonstrate a clear, financially viable development plan that requires vacant possession of the property.
Key Lessons from Recent Case Law
Case 1: S Franses Ltd vs The Cavendish Hotel (London)
In this landmark case, the Supreme Court ruled against the landlord, finding that the proposed development was not genuine.
The Cavendish Hotel, which owned the building, attempted to rely on Ground (f) to refuse a new lease to its tenant, S Franses Ltd, a textile dealer operating on the ground floor and basement.
The court concluded that the landlord’s development scheme was designed solely to defeat the tenant’s right to renew the lease, rather than being a legitimate project requiring vacant possession.
Case 2: Sainsbury’s Supermarkets Ltd vs Medley Assets Ltd
Sainsbury’s operated a supermarket on the ground floor of a building in Kentish Town, London.
Although parts of the premises, such as the basement and upper floors, were unused or vacant, the lease covered the entire building.
Medley Assets sought vacant possession under Ground (f) to facilitate development. However, just before the trial, Sainsbury’s strategically retreated to a portion of the premises unaffected by the proposed works.
This move undermined the landlord’s claim, as the court required the works to be impossible without full vacant possession of the tenant’s actively used space.