Break clauses & break clause disputes

Break clauses are an important aspect of commercial leases, offering both landlords and tenants the flexibility to terminate the lease agreement before the end of the fixed term.

Whether you are a tenant looking to exit a lease early due to changing business needs, or a landlord seeking to regain control of your property, understanding how break clauses work is crucial. At Moore Barlow, we provide expert guidance on the use and enforcement of break clauses, helping you navigate this complex area with confidence.

A well-drafted break clause can be a valuable tool, but exercising it requires careful attention to detail. The conditions attached to a break clause must be met precisely; otherwise, the right to terminate could be lost. This is where expert legal advice becomes essential. Our team at Moore Barlow has extensive experience in advising both landlords and tenants on the intricacies of break clauses, ensuring that your rights and interests are fully protected.

The inclusion of a break clause in a lease can provide much-needed flexibility, but it also introduces potential risks. For tenants, the ability to exit a lease early can be a lifeline in challenging economic times. For landlords, a break clause can allow for the re-letting of the property at a higher rent or the opportunity to redevelop. However, the exercise of a break clause often leads to disputes, making it vital to have clear, enforceable terms.

What is a break clause?

A break clause is a provision within a lease agreement that allows either the tenant, the landlord, or both to terminate the lease early, usually after a specified period and under certain conditions. These conditions can include giving the required notice, ensuring that rent payments are up to date, and fulfilling any other obligations outlined in the lease. Failure to meet these conditions can invalidate the break, leaving the lease ineffective.

What is a break clause dispute?

A break clause dispute arises when there is a disagreement between the landlord and tenant regarding the validity or exercise of a break clause in a lease agreement. This can involve disputes over whether the correct notice was given, whether all conditions for the break were met, or if the break clause is enforceable.

How we can help with break clauses

At Moore Barlow, we offer comprehensive legal advice and support related to break clauses. Our services include:

• Drafting and reviewing break clauses: Ensuring that the terms are clear, enforceable, and tailored to your specific needs, whether you are a landlord or tenant.
• Advising on the exercise of break clauses: Helping you understand and fulfil the conditions necessary to exercise the break clause successfully, avoiding potential pitfalls that could lead to disputes.
• Dispute resolution: Representing your interests in any break clause disputes that arise from the exercise or interpretation of a break clause, whether through negotiation, mediation, or litigation.
• Strategic advice: Providing guidance on the timing and implications of exercising a break clause, helping you make informed decisions that align with your business goals.

Our team’s deep understanding of commercial property law and extensive experience in handling break clause issues allows us to provide practical, strategic advice that protects your interests and helps you achieve the best possible outcome.