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As a commercial tenant, there are responsibilities that you must uphold to maintain your tenancy. However, in exchange for the fulfilment of these obligations, you are entitled to certain rights and benefits. This article will outline what each of the rights are that you have an entitlement to as a commercial tenant.

Right to Quiet Enjoyment

You have a right to quiet enjoyment of your leased premises. The right of quiet enjoyment entitles you to lawfully and peacefully use the commercial property to your benefit without interruption. Your landlord is cannot interfere with your use of the commercial premises throughout your tenancy. 

Right of Exclusive Possession

Your right to quiet enjoyment of your leased commercial premises stems from your right to exclusive possession. The right of exclusive possession entitles you to exclude all other individuals from the premises you are leasing. You can exclude your landlord from the property, except when they have a legal right to enter. Your landlord can enter the premises to:

  • repair damage done to the premises;
  • inspect the commercial property; or
  • serve a notice to cancel your lease. Your landlord may serve such a notice because you failed to pay rent on time or breached a term of your lease agreement.

Right to Certainty of Rent

As a tenant, you are entitled to certainty of rent. This right does not require your landlord to have a certain amount of rent on the date that you sign the lease agreement. However, you must be able to calculate the cost of rent with certainty at the time when you have to make your first rent payment. If your landlord changes your rent price throughout your tenancy due to rent review or an agreement that you entered into, they should notify you in advance. 

Right to Insurance

Your landlord will likely be obliged to maintain insurance for your commercial building. Further, your landlord is required to cover the cost of repair, on the basis that they are insured against these risks, if your premises are destroyed by:

  • fire;
  • flooding;
  • an explosion;
  • lightening or storms;
  • an earthquake; 
  • a volcanic eruption; or
  • any other risks that your landlord is insured against. 

Furthermore, if you or your business suffers harm as a result of the damage done to the commercial premises, you can be compensated by your landlord’s insurance. However, you will not have this right to compensation if the harm you suffered resulted from your own actions or omissions. 

Right to Immediate Termination of Lease

If one of the above natural disasters were to occur, it might also entitle you to terminate your commercial lease. However, you only have a right to immediate termination if your premises are untenantable. A commercial property will be untenantable if something, such as an earthquake, substantially interferes with your ability to enjoy, use and operate out of the premises. This interference must have a degree of permanence. It is not sufficient if it stops your business from operating out of the premises for a few days or a temporary period. 

Right to Reduced Rent

If this natural disaster or emergency does not render your premises untenantable, you may still have a right to another remedy. There may be a period where you cannot access your leased premises to conduct your business, because it would be unsafe or cause further damage to the property. Those circumstances entitle you to reduced rent and outgoings. 

This reduction must be a fair proportion of the cost of your rent and outgoings. You can get this reduction for the period commencing on the day that you were unable to gain access to the commercial premises until the date that you regain entry. This period is known as the ‘no-access period’. 

Right to Recoupment

There are also instances where you have a right to compensation or reduced rent outside of emergencies. This compensation is known as recoupment. When your landlord breaches their obligations under your tenancy agreement, it will usually entitle you to recoupment. 

For example, say your landlord is obliged to maintain and repair the exterior of your commercial building. If they fail to do so, you may, after providing them notice, conduct the repairs yourself and deduct this expense from your rent. You can do so due to your right to recoupment.

Key Takeaways

An array of rights accompanies being a commercial tenant. These rights include:

  • quiet enjoyment;
  • exclusive possession;
  • certainty of rent;
  • insurance;
  • immediate termination of rent when the premises are untenantable;
  • reduced rent during a no-access period; and
  • recoupment. 

However, you only have an entitlement to these benefits if you uphold your obligations under your commercial lease agreement. If you would like more information about your business’ rights as a commercial tenant, contact LegalVision’s property and leasing lawyers on 0800 005 570 or fill out the form on this page.

Frequently Asked Questions

What are commercial landlords responsible for?

Commercial landlords are responsible for not infringing upon their tenant’s right to quiet enjoyment of their leased property. They are responsible for eliminating, or minimising risks to their tenant’s health and safety, ensuring that their premises comply with building laws and maintaining insurance for their commercial property. 

Can a commercial landlord enter without permission?

A commercial landlord is usually not allowed to enter commercial premises without their tenant’s permission. Doing so would interfere with their tenant’s right to exclusive possession and quiet enjoyment of their premises. 

Can a tenant terminate a commercial lease early? 

A commercial tenant is able to terminate a commercial lease early when they have entered into an agreement to do so with their landlord or their lease has become untenantable. 

What is a commercial tenant entitled to? 

To quiet enjoyment and exclusive possession of their leased premises, the certainty of rent, insurance of their leased property, the immediate termination of rent when the premises are untenantable, reduced rent during a no-access period and recoupment if the landlord breaches their tenancy obligations.

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