Overview

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In an economic downturn tenants are more likely than ever to be reviewing their property requirements and keen to divest themselves of surplus premises. Break clauses can be a useful tool for tenants in this situation. In a difficult market, however, landlords will be equally keen not to let their tenants leave and so it is important that tenants take care to operate break clauses correctly.

Compliance with the provisions of a break clause can appear relatively simple but a recent decision of the High Court (Hotgroup plc-v-Royal Bank of Scotland plc) has highlighted the dangers of failing to consider all the terms of the lease.

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