Categories:Real Estate,UK

Conditions to break clauses have become slimmer and more focused

In recent years, conditions to break clauses have generally become slimmer and more focused. There has been an increasing acceptance that if the conditions are too broad, particularly in respect of compliance with tenant covenants as a whole, it makes the break in any real sense unworkable, or at least easily open to challenge. However, even in this latest phase, and despite the decrease in length of most commercial leases, new problems are arising. The elephant traps seemingly continue to abound!

It is no real surprise that hardened times have resulted in tenants looking to use break clauses, where available, to extricate themselves from leases. And it is no surprise that some of those attempts to break have been challenged by landlords. Given the history of judgments on break clauses, with strict compliance being the mantra, it should perhaps be no further surprise that even ‘leaner’ break clause provisions are being interpreted strictly by the courts…

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