The Break Clause
A lease is not the product of two people in love who want to spend the rest of their lives together. It is a document drafted by the landlord’s lawyers with the aim of transferring as many burdens to the tenant as possible, without causing him to pass out on the spot. The break clause is the tenant’s parachute. It allows him to exit the lease early. He activates it by sending a notice that he wishes to break the lease on the next ‘break date’. So what can go wrong?
Beware the Narrow Window
The Break Clause may be worded to create only a narrow window in which the notice can be served. So if the tenant misses it, he is locked in until the next window.
Manner
Second, the landlord may make the manner in which the notice has to be sent difficult to comply with. The clause might specify that the notice is by hard copy (a letter) rather than email or fax.
Recipient
Third, the address for service may be made difficult. Instead of being the landlord’s agent - with whom the tenant may be used to dealing – it may be an address by first class post in Scotland.
Tenant must comply with all other Terms
The lease may specify that the notice will not have effect if the tenant is in breach of any other term. This creates in the tenant’s mind a sense of doubt. Few break clauses are activated by happy tenants. So, if at the same time as serving the notice the tenant is in a dispute over repair works, he is put under the additional pressure of not knowing whether his notice to break will be operative or not.
What should the wise tenant do?
Challenge the break clause. The following is an example of a reasonable break clause: Eg: “A Notice to operate the Break clause may be given to the landlord or his agent in writing (email will suffice) at any time at least 3 months prior to the relevant Break Date. And whether the tenant may be in breach of any other term in the Lease shall not affect the validity of the notice.”
If you are uncertain when or how you must serve notice under your break clause, take advice.