When a commercial tenant remains in a property after the day on which its contractual tenancy has ended, landlords may be able to penalise the tenant, financially, for remaining in the premises. There are two long standing statutes in UK law in relation to this, which give the landlord entitlement to double value and double rent.
Double value
The Landlord and Tenant Act 1730 allows a landlord to charge a tenant double the annual value of the premises for unlawfully remaining in them after the previously agreed end date, as stated in the lease.
As specified in section 1 of the Act, should the tenant “…wilfully hold over any Lands, Tenements or Hereditaments, after the Determination of such Term or Terms, and after Demand made, and Notice in Writing given, for delivering the Possession thereof, by his or this Landlords or Lessors” the landlord is able to charge the tenant “at the Rate of double the yearly Value of the Lands” for the time that the tenant unlawfully remains in the premises.
It is important to note that double value isn’t essentially doubling the monthly rent. It is double the amount that the tenant would pay the landlord for the overall use of the property freehold and everything related to it, whilst they unlawfully remain in it. So, the amount that the landlord is entitled to receive may be more than double the amount of rent.
It is also important to be aware that this only applies in the circumstances in which a landlord has demanded possession in writing (e.g. a notice to quit) but the tenant chooses to remain in the premises unlawfully (e.g. as a trespasser).
However, this 18th century piece of legislation does not apply to short-term weekly tenancies arrangements and in some cases, monthly or quarterly tenancies.
Double rent
Double rent is covered in the Distress for Rent Act 1737 and permits a landlord to demand two times the amount of rent from the tenant. However, the circumstances in which double rent can be claimed are different from double value.
Under section 18 of the Act, where a tenant has given notice to the landlord that they will vacate the premises after the end date specified in the commercial lease but then remain, the landlord is able to claim double the amount of rent from the tenant whilst they stay in the premises.
The fundamental difference between double value and double rent is that the landlord is giving notice to the tenant that they must vacate the premises, but with double rent it is the tenant who gives notice that they intend to vacate.
For a landlord to lawfully claim double rent, they must treat the tenant as a trespasser and not act in a way that would deem to be seen as the tenancy still continuing.
Additionally, the landlord must not accept the previously agreed and paid rental amount from the tenant once the commercial lease has expired. If they do, then they will not be able to claim double rent.
With both double value and double rent, should the tenant be able to conclusively prove that they believed that they were lawfully able to remain in the premises beyond the end date in the commercial lease, then they may be able to dispute a claim for double value or double rent.
How can Nelsons help?
Sarah Burns is a Solicitor in our expert Commercial Property team.
If you require any advice in relation to the subjects discussed in this article, please contact Sarah or another member of the team in Derby, Leicester or Nottingham on 0800 024 1976 or via our online form.