What are break clauses in Tenancy Agreement?
This is an agreement which if found in the tenancy agreement that gives both parties the opportunity to prematurely terminate the tenancy agreement. Example a 24-month contract can be terminated after 12 months. The breaking of this clause can be undertaken by either the tenant or the landlord provided the correct procedures are followed. 
One thing that needs to be noted is that even if a break clause is included in the tenancy, the court is prevented from awarding possession to the landlord due to the Housing Act 1998 until six months of the tenancy has passed. The landlord may have the right to evict tenant using one of the seventeen statutory ground of possession and should serve a Section 8 Notice before. It also has to be noted that, break clause can only be enforced 6 months into the fixed term of the tenancy.
Tenancy Breaking Notice
If a landlord wants to enforce the break clause, he/she is required to serve a written notice (Section 21 Notice) to the tenant at least two months before the eviction date. The same goes for the tenants too: they should submit a written notice known as the Tenancy Surrender Notice. But the tenant enjoys some statutory right which allows them to submit a one-month notice if they want to end the tenancy after or on the fixed term.
Why use the break Clause?
Break Clause bring flexibility to both the landlord and the tenant. It provides them with the opportunity to break mutually the tenancy agreement due to personal circumstances like a change in the financial circumstances of the tenant, relocating of the tenant to another place due to work or even when the relationship between both get soar.
Is Break Clause the Best?
This is a question with an indirect answer. Some find break clause flexible others too do not. One would not want or like to use break clause because they deem it to be scary.
Let us take this scenario below:
Assuming a landlord wants to use break clause and sends his/her tenant a notice; in this case, if the tenant refuses to vacate the premises after the date, then the landlord will have no option than to proceed to court in other to get an order possession. The court will now decide if the break clause is valid or not and if they are not happy with it, then the landlord will not get possession.
What can happen that will make the court unhappy with the break clause?
Well the break clause is drafted in a way that is fair to both parties. If the court decides it was fairly or properly drafted, then the landlord will have a better chance of getting possession but if the court decides otherwise (if it was drafted to favour the landlord), then it is unlikely to be enforced.
To this point, a break clause should be fairly drafted with high degree of legal expertise.
Alternate Methods to Break Clause
Looking at the “problem” an unfairly drafted break clause can bring, some landlords choose to go by the 6-month tenancy agreement method. Here the landlord will rent out the property for a term of 6 months which is subject to renewal. This way if the landlord or the tenant wishes to end the tenancy, they can easily do it without the break clause.
Here if a problem is to arise and the tenant refuses to vacate the property after a valid possession notice (section 21) is served to him/her, the landlord is assured of possession if the case is taken to court.
Do you use break laws?
Unfairly drafted break laws is one of the main causes of dispute between tenants and landlords. It is advisable to seek a professional help in drafting one.
Get your Landlord Electrical Certificate, Gas Certificate, PAT Certificate and EPC Certificate.
Write a Comment