Glossary

Chiropractor

A health care professional focused on the diagnosis and treatment of neuromuscular disorders

Consultant

A hospital doctor within a specific field who provides expert advice.

Court Claim

Taking court action against an individual or company who owes you money and wont pay.

Damages

A Sum of money claimed or awarded in respect of compensation for a loss or an injury.

Dentist

An individual who is qualified to treat diseases and other conditions that affect the teeth and the gums.

Diagnosis

The identification of the nature of an illness or other problem by examination of the early symptoms.

Doctor

An individual who is qualified to medically treat an individual.

General Practitioner

A doctor based in your local community who is qualified to medically treat and individual.

Injury

Damage to the body or part of the body.

Negligence

Failure to take proper care of something. Breach of a duty of care which results in damage.

Negotiation

Discussions between parties in effort of reaching an agreement.

No Win No Fee Agreement

Also known as a ‘Conditional Fee Agreement’. A legal funding arrangement where you only pay for your Solicitors work on the condition that your case is won.

Optician

An individual qualified to prescribe and dispense glasses, contact lenses and detect eye diseases.

Pharmacist

An individual who is professionally qualified to prepare and dispense medicinal drugs.

Physiotherapist

An individual who works with people to help with a range of problems which affect movement using exercise, massage and other techniques.

Psychological

Affecting the mind, relating to the mental and emotional state of a person.

Settlement

An official agreement intended to resolve a dispute or conflict.

Solicitor

A member of the legal profession qualified to deal with legal matters.

Suffering

The state of undergoing pain, distress or hardship.

Treatment

Medical care given to a patient for an illness or an injury.

Will there be any limitations on the use of the premises e.g. what type of business may be carry on or if there limits on the hours you may have access?

A landlord will usually want to limit the activities that can be carried out at the premises for a number of reasons e.g. to ensure that there is no breach of planning law, that you do not annoy neighbouring tenants, that your proposed use does detrimentally affect the value of the property. You should agree a use that ensures that you can operate your business but that is not so restrictive that it limits any diversification of your business that may occur during the term.

Negotiation tip: try and agree a use that is restricted only to one of the planning Use Classes. If you want to reserve the right to change the planning use of the premises then ensure that the landlord can not unreasonably refuse permission to change the permitted use.

Can you carry out alterations such as fitting out a shop or installing partition walls?

Bear in mind that most standard leases will prohibit alterations so if you think you may want to erect shop displays, install partition walls, install new heating systems or flues etc then you will need to agree this with the landlord in advance. If you are negotiating a longer term lease and you want the freedom to carry out more significant alterations then try and agree this with the landlord in advance.

Negotiation tip: if the landlord is unwilling to agree to you having the freedom to carry out major works suggest that the lease includes rights for the landlord to review the plans and specifications and a right to veto them if your proposals are unreasonable.

Can the rent be increased during the term

The longer the duration of the tenancy the more likely it is that the landlord will want to increase the rent during the term. There are 2 main types of rent review: (1) market rent review; and (2) index linked rent review. A market rent review will involve an expert identifying the rent that could be obtained if the premises were remarketed on the rent review date. An indexed linked rent will involve a relatively simple recalculation of the rent so that it increases in line with inflation. An indexed rent has the merit of simplicity and certainty for both parties. However in recent years the increase in general inflation has been far higher than the increase in property rentals, and so by agreeing an indexed rent review you could well end up paying a higher rent than would be justified on the open market.

Negotiation tip: a rent review can increase the rent to an unexpected level especially if you have negotiated a good rent at the commencement of the lease. To provide you with a plan B when the rent review arrives try and agree an option to terminate (or “Break”) the lease once the new rent has been determined.

Whether you can assign the lease or sublet it

Bear in mind that you are signing up for a minimum lease term. If you think you may want to get out of the obligations in the lease before the time is up then you should attempt to agree a right to do this (a “Break Option”). If the landlord will not agree to this then a landlord may instead agree to permit you to assign the lease to a third party or to sublet it. However, the landlord is likely to insist that you guarantee the new tenant’s obligations.

Negotiation tip: see if the landlord will agree to limit the circumstances where you may be required to guarantee the new tenant’s obligations e.g. only where the new tenant is of lower financial standing to you or where the new tenant does not offer security like a rent deposit or personal guarantee.

Who will be responsible for maintaining the premises (and if so, what parts of the property e.g. just the inside or the structure, foundations, roof etc)

For short term leases you should try and ensure that your responsibly to repair is limited to the internal non-structural parts of the premises only. You should also try and ensure that the landlord is not able to recover from you the costs of carrying out maintenance works. Most tenants do not appreciate that a tenant’s agreement “to keep the property in repair” means you have to make good any existing defects i.e. that you first have to put the property into repair, even if it is in a bad state of repair to start with.

Negotiation tip: if the landlord requires you to maintain the premises then try and agree that the obligation is to maintain in its present state – and obtain a “schedule of condition” so that there can be no dispute about this in the future. This would mean that you would not have to fix any existing defects.

What other payments must be made to the Landlord e.g. insurance costs (“Insurance Rent”) or maintenance costs (“Service Charge”)

The rent is only one of a number of payments that you may have to pay the landlord. The landlord will try and recoup from you the cost of insuring and maintaining the building.

Negotiation tip: for shorter leases try and agree an annual cap on the costs recoverable from you.

Whether you (or the landlord) may end the lease early (called a Break Option)

This may be particularly important for new or growing businesses or for businesses where the future seems uncertain. Try and agree a right to terminate the lease after a certain date. Try and resist an attempt by the landlord to incorporate a break option in the landlord’s favour as this can cause uncertainty for your business.

Negotiation tip: if the landlord insists on including a break option for the landlord’s benefit then try an agree a long notice period e.g. the landlord must give you 12 months’ notice in writing before being able to end your lease early.

Can you renew the lease at the end of the term?

Most business tenants have a statutory right to request a new lease at the end of the term. However, this is not guaranteed as a landlord has a limited right to deny this e.g. if the landlord needs to occupy the premises or if it wants to carry out redevelopment. If you want to be sure that you can renew the lease at the end of the term then you should agree this explicitly.

Negotiation tip: if the Landlord will not agree to a right to renew then you may want to suggest that the duration of the lease is longer but that you have a right to break the lease during the term e.g. instead of a 3 year lease that is renewable for a further 3 years, suggest a 6 year lease that can be terminated after 3 years.

Rent Deposit

This is usually a separate document requiring you to make an upfront payment typically equivalent to 3, 6 or 12 months’ rent which the landlord can draw on if money is owed.

Personal Guarantees

A document that includes a guarantee of the tenant’s obligations under the lease, which means if there is any breach or default by the tenant, the landlord can claim against the guarantor personally.

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