Part 1 – The Demise
For a lease to be legally effective it must set out precisely the area given to the tenant, known as the demise. The property is often referred to as the demised premises as a result. If the demise is unclear then the lease may be invalid or may be considered a licence instead, which is a more informal arrangement, with less protection and certainty for both sides.
Sometimes the demise will be straightforward, for example where the tenant is leasing the entirety of a building. On other occasions it will be more involved, for example if you are taking part of a shared office building. Where only part of a building is being taken, the lease should contain specific details of where the dividing lines are drawn. For example, if a wall is to act as the division between two parts of a building, it may be defined as a party wall, or the landlord might retain the structural elements and the tenant will get the plasterboard and decorative finish. Precision is critical to avoid uncertainty between the parties as to who is responsible for what.
A plan is often used to illustrate the extent of the property. If the lease has to be sent to the Land Registry, either to be noted against the landlord’s title or to be registered in its own right, then the plan must comply with the Land Registry’s strict requirements.
In this series of articles, we are aiming to give you a brief overview of the principal areas covered by a commercial lease. These articles are for guidance only and do not represent legal advice. If you need advice or assistance on leases or any other property concern, please do not hesitate to contact Andrew Rannie, Head of the Property Department for a free initial consultation.