Landlord entitled to end tenancies and demolish properties

The High Court has ruled that a landlord was entitled to terminate the tenancies on commercial properties so he could apply for planning permission to build houses.

The case involved several tenants who provided aviation-related facilities from rented buildings at an airfield owned by Littler Investments Ltd.

Littler served notices to terminate the tenancies as it wanted to demolish the buildings and promote the airfield for residential development. When the tenants applied to the court for the grant of new tenancies, the landlord relied on the Landlord and Tenant Act to oppose such grants on the ground that it intended to demolish the premises.

The judge found that the landlord had a reasonable prospect of obtaining planning permission to demolish the premises even though the local authority’s development plan contained a principle to retain aviation-related facilities at the airfield.

He concluded that the plan’s policy conferred a broad discretion on the local authority to determine the extent to which that principle applied to a planning application for demolition. He further found that there was no realistic prospect of reinstatement because the landlord had legitimate and substantial commercial grounds for ending the aviation-related use.

The tenants appealed, submitting that the judge had erred in finding that the landlord’s future intention for the buildings was a relevant consideration, as that would enable landowners to frustrate the planning system and always succeed in obtaining demolition consent simply by asserting an intention not to continue the premises’ existing use.

The High Court found in favour of Littler. It held that the judge’s approach could not be faulted. He had been entitled to conclude that there was no realistic prospect of the landlord reinstating aviation-related use if consent to demolish was refused.

Please contact Jonathan Carr or Janice Young if you would like more information about the issues raised in this article or any aspect commercial property law.