Hough v Greathall – When must a landlord prove an intention to redevelop?

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When a landlord opposes the grant of a renewal lease, the date by which the landlord must prove its intention and ability to redevelop can be critical. In Hough v Greathall the Court of Appeal answered this important question.

The tenant argued, before the Court of Appeal, that the wording of section 25 of the Landlord and Tenant Act 1954 meant that the date on which a landlord’s intention to redevelop must be proved, with all attendant evidence on planning, design, financial and scheduling feasibility, was brought forward from the date of trial (as per received wisdom on the point) to the date of service of the landlord’s lease termination notice. If the tenant was correct, as well as placing significant pressure on landlords prior to service of any notice and introducing potential works-scheduling issues, this would raise practical difficulties in cases where it was not the person serving notice, but rather a purchaser/developer, who would ultimately carry out the works.

The court confirmed that the date for proving intention is the date of trial. However there is sense in a landlord providing a tenant with the evidence in support of its intention to re-develop at an early stage where this possible. In those circumstances, the tenant will run a significant costs risk if it disputes the intention to re-develop. This may, therefore, act as a powerful incentive to agree an early settlement.

Please see our earlier briefing for further detail