A lease will contain an implied term that a tenant will give up possession of the property to its landlord at the end of the term; see Henderson v Squire (1869) LR4 QB 170. The tenant must vacate the property and anything that has become a part of it, such as new buildings. It must also ensure that, subject to statutory rights of protection, any subtenant vacates.
Nevertheless, most leases contain an express covenant to yield up. This usually requires the tenant to yield up in repair; although this probably comprises an obligation both to deliver up possession and to deliver up in repair. But what does an obligation to “yield up” mean? There is a surprising absence of authority on the point, and no prescribed form or procedure for “yielding up”.
In John Laing Construction Ltd v Amber Pass Ltd [2004] 17 EG 128 (CS), a tenant’s break clause required the tenant to yield up the property. The High Court held that, in the absence of any prescribed form or process, the test will be whether the tenant can demonstrate a clear intention to terminate the lease and whether the landlord can occupy the property without difficulty. In Laing, the tenant’s continued possession of the keys was not considered to be an assertion of a right to occupy or of a right to possession of the property, in line with, for example, Gray v Bompas (1862) 11 CB(NS)520. Nor did the presence of security guards or removable concrete barriers prevent the landlord from occupying the premises. By serving a notice to break and vacating the property, the tenant had manifested a clear intention to end the lease.
The absence of any defined procedure to comply with an obligation to yield up can make it difficult for a tenant to know whether it has done enough. This is particularly important if one of the preconditions to the exercise of a break clause is that the tenant yields up the property; failure to comply strictly could result in the tenant losing its right to break. In Laing, the court said that it would have been sensible for the tenant to have tendered the keys to the landlord and to have asked whether the landlord wanted to continue with the security arrangements, but that this was not a requirement of the obligation to yield up.
Jacqui Skovron, professional support lawyer at Allen & Overy
Related item:
A lease will contain an implied term that a tenant will give up possession of the property to its landlord at the end of the term; see Henderson v Squire (1869) LR4 QB 170. The tenant must vacate the property and anything that has become a part of it, such as new buildings. It must also ensure that, subject to statutory rights of protection, any subtenant vacates.
Nevertheless, most leases contain an express covenant to yield up. This usually requires the tenant to yield up in repair; although this probably comprises an obligation both to deliver up possession and to deliver up in repair. But what does an obligation to “yield up” mean? There is a surprising absence of authority on the point, and no prescribed form or procedure for “yielding up”.
In John Laing Construction Ltd v Amber Pass Ltd [2004] 17 EG 128 (CS), a tenant’s break clause required the tenant to yield up the property. The High Court held that, in the absence of any prescribed form or process, the test will be whether the tenant can demonstrate a clear intention to terminate the lease and whether the landlord can occupy the property without difficulty. In Laing, the tenant’s continued possession of the keys was not considered to be an assertion of a right to occupy or of a right to possession of the property, in line with, for example, Gray v Bompas (1862) 11 CB(NS)520. Nor did the presence of security guards or removable concrete barriers prevent the landlord from occupying the premises. By serving a notice to break and vacating the property, the tenant had manifested a clear intention to end the lease.
The absence of any defined procedure to comply with an obligation to yield up can make it difficult for a tenant to know whether it has done enough. This is particularly important if one of the preconditions to the exercise of a break clause is that the tenant yields up the property; failure to comply strictly could result in the tenant losing its right to break. In Laing, the court said that it would have been sensible for the tenant to have tendered the keys to the landlord and to have asked whether the landlord wanted to continue with the security arrangements, but that this was not a requirement of the obligation to yield up.
Jacqui Skovron, professional support lawyer at Allen & Overy
Related item:
John Laing wins lease dispute, EGi Legal News 8 April 2004
