Malcolm Dowden advises on the pitfalls of contracting out from security of tenure
In Newham LBC v Thomas Van-Staden [2008] EWCA Civ 1414 the Court of Appeal recently held that “contracting out” was ineffective where a lease defined the term as a fixed period together with “any period of holding over or extension; whether by statute or at common law or by agreement”.
The county court judge had decided that the contracting out process had been valid, so a landlord’s notice to quit given after the expiry of the fixed term brought the tenancy to an end. The Court of Appeal rejected this view. The words of extension used when defining the term meant that it could not be seen as a “term certain”.
The ability to exclude or “contract out” from security of tenure is extremely important to landlords. Where security of tenure applies the end of the contractual term does not mean the end of the tenancy. The tenant is entitled to: (i) remain in occupation, and (ii)
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