INTERIM OCCUPATION Sample Clauses

INTERIM OCCUPATION. It is important to appreciate the status of the prospective tenant who wants or is permitted to occupy the premises pending completion of the formal lease. When acting for the landlord it is important to ensure that any interim occupation cannot create problems if the expected lease is not completed for whatever reason. There are two potential vehicles that can be used – • The tenancy at will Although the payment of rent can convert a tenancy at will into a periodic tenancy the courts are unlikely to find a periodic tenancy particularly where the parties are negotiating a replacement lease which is to be contracted out. • License’s A license to occupy land can either be fixed in duration or periodic. It can be the subject of a contractual payment and will not be protected by the Landlord and Tenant Act 1954. Licenses tend to be more attractive than the tenancy at will as the former have a set duration. Licenses can create problems as seen in the case of Street v ▇▇▇▇▇▇▇▇▇ (1985) 274 EG 821 in which the court treated the occupation as a lease and the occupier will then have a protected tenancy. The case of Cameron Ltd v Rolls Royce plc [2007] EWHC 546 (Ch) considered the legal status of a former tenant which remained in occupation pending the agreement for a new lease. In this case between 1999 and 2002 Rolls Royce had been the tenant of two sets of premises under three-year sub-leases contracted out of the 1954 Act. The subleases expired and Rolls Royce remained in occupation while it negotiated new leases. In May 2003, Rolls Royce entered into two agreements for lease with the relevant leases running from 2002 until March 2007. In the interim period Rolls Royce was to be the licensee of the premises on the same terms as the leases. Each agreement for lease was conditional upon the court approving the contracting out and on the head landlord’s consent. In 2004 court orders were obtained and in January 2007 the head landlord gave consent. Rolls Royce was then called upon to enter into agree leases, but it declined to do so. It did want the premises but was anxious to show that it had fully protected tenancies so that it would qualify for statutory rights of renewal. The argument put forward by Rolls Royce was that the so-called licenses of the premises were in reality tenancies and so were protected under the 1954 Act. It relied on the following – • It had exclusive possession of the premises. • The licenses were to last until either the term date of the in...