When businesses often go without a solicitor for a lease, and what to check yourself

Is a solicitor always worth it?

Not every property agreement carries enough risk to justify a full review. This page describes situations where businesses often decide to go without one, and what to check if you do. It isn’t a judgement on your agreement: only someone who has read it can tell you what it says. It covers England and Wales only.

The useful question is how much you could lose. Compare your total commitment, and what could go wrong, with the cost of advice. The examples below use illustrative figures, not quotes.

The further down that table you are, the stronger the case for advice.

When do people often decide a full review isn’t needed?

• Serviced offices and co-working. Where the agreement is a short, standard-form one with services included, some businesses decide there is little to negotiate. Read the notice period and what is included.
• Short licences. A licence to occupy for a few months, which you can end on short notice. Check what the arrangement actually gives you, whatever it is called.
• Tenancies at will. Sometimes used while a proper lease is negotiated. Check what rights it gives you and how it can be ended.
• Very short fixed terms. Under section 43(3) of the Landlord and Tenant Act 1954, a tenancy for a fixed term of six months or less generally has no statutory right to renew, unless it can be renewed or extended beyond six months, or you (with any predecessor in your business) have been in occupation for more than twelve months. The Law Commission has consulted on raising that threshold, but no change is in force.
• Very low rent and easy exit. Where the total you could owe is small and you can leave quickly.

What should you check yourself?

If you go ahead without advice, read the whole agreement and make sure you can answer these:

1. How do I get out? The notice period, how you give notice, and any fee for leaving early.
2. What will it cost in total? Rent, VAT, service charges, business rates, utilities and any fees.
3. What do I have to repair? Anything beyond internal damage you cause? Take dated photos on the day you move in.
4. Am I signing personally? Any personal guarantee, or a company or individual named as the occupier.
5. What happens to my deposit? How much, and when and how it comes back.
6. What do I have to do when I leave? Remove alterations, redecorate, clean?
7. Can I use the space for my business? Permitted use, opening hours, signage.
8. Whose legal costs? Under the Costs of Leases Act 1958 you don’t have to pay the landlord’s legal costs of the lease unless you agree in writing.

When is it worth getting advice anyway?

Even for a short or cheap let, these are signs that the agreement deserves a solicitor’s review:

• You’re asked to give a personal guarantee.
• You plan to spend real money on fit-out or equipment for the premises.
• The agreement makes you repair the structure, roof or exterior, or the building is old.
• The term is longer than you need, or there is no way to end it early.
• You’re asked to sign a declaration excluding the 1954 Act. That means the landlord intends you to have no right to renew, and the procedure under section 38A has to be followed for the exclusion to work.
• A “licence” gives you exclusive use of the space for a long period. Check what it actually gives you, whatever it is called.
• Anything in the agreement surprises you or you don’t understand it.

The RICS Code for leasing business premises requires the other side or its agent to tell an unrepresented party about the Code and recommend professional advice (RICS Code, Part 2 para 1.2). If you are signing a lease rather than a short licence, have it checked by a solicitor before you sign: we introduce you to an independent SRA-regulated solicitor who can review it.