Commercial Lease agreement

[Daniel Porter]

Hi, I rent various rooms in different locations. I am trying to rent a new room in a new location, I was sent this rental agreement. After reading, it seems wrong to me. Could you please help and explain why?


Daniel


Licence to Occupy –

1. Definitions and interpretation

1.1 In the Licence:

"Date of Entry" means

"Date of Termination" means the date upon which the Licence terminates;

"Interest" means interest on the sum in question at 4% per annum above the base rate from time to time of Barclays Bank plc from the date that such sum is due for payment or, if there is no such date specified, the date of demand for such sum until such sum is paid;

"Licence" means the licence to occupy the Property constituted by this deed;

"Licence Fee" means the sum of £50 per day plus £50 per day for any additional days (days other than Tuesday and Saturday);

"Licensee" means

"Licensor" means "Parties" means the Licensor and the Licensee;

"Permitted Use" means use of one room as a beauty treatment room and use of the communal areas (reception, bathroom and kitchen), entrance hall and staircase;

"Property" means 1 first floor room at

"Working Day" means any day except Sundays and Bank Holidays

1.2 In the Licence, unless otherwise specified or the context otherwise requires:

1.2.1 any reference to one gender includes all other genders;

1.2.2 words in the singular only include the plural and vice versa;

1.2.3 any reference to the whole is to be treated as including reference to any part of the whole;

1.2.4 any reference to a person includes a natural person, corporate or unincorporated body (whether or not having separate legal personality) and words importing individuals include corporations and vice versa;

1.2.5 any reference to a Clause is to the relevant Clause of the Licence;

1.2.6 any reference to a statute or statutory provision includes any subordinate legislation which is in force from time to time under that statute or statutory provision;

1.2.7 any reference to any statute, statutory provision or subordinate legislation is a reference to it as it is in force from time to time taking account of any amendment or re-enactment;

1.2.8 any phrase introduced by the words "including", "include", "in particular" or any similar expression is to be construed as illustrative only and is not to be construed as limiting the generality of any preceding words;

1.3 The headings in the Licence are included for convenience only and are to be ignored in construing the Licence.

2. Licence

2.1 Subject to due compliance by the Licensee with her obligations under the Licence, the Licensor will permit the Licensee to occupy and use the Property for the Permitted Use

2.2 The Licensee will occupy the Property as mere licensee only and acknowledges that possession of the Property is retained by the Licensor subject to the rights created by the Licence.

2.3 The Parties agree that the Licence is not a lease and does not confer any tenancy rights on the Licensee.

3. Duration

3.1 The Licence will commence on the Date of Entry and will continue month to month after that until terminated by either Party on delivering to the other Party not less than one month's written notice to the effect that they are terminating the Licence at the expiry of the period specified in the notice.

3.2 At the Date of Termination, the Licensee will:

3.2.1 remove from the Property with their whole equipment and other items, without the need for any notice from the Licensor, and

3.2.2 leave the Property in a condition consistent with full compliance with their obligations under the Licence.

4. Payments

4.1 The Licensee will pay the Licence Fee to the Licensor by equal instalments in advance on the first day of each month, the first payment being due on the Date of Entry in respect of the period from the Date of Entry to the next payment date, and monthly after that, by bank transfer if so required by the Licensor.

4.2 The Licensee if using the room permanently will pay £395 per month on the 25th of each month.

4.3 If the Licensee is using the room “ad hoc” the payment will be paid on booking. Payments are as follows: 1 hour to 3 hours : £12.50 per hour, 4 hours (half day) £30, One day £50

4.4 If the Licensee uses the room for regular days the payments will be paid in advance, per month. The fee being: £45 per day for one day, £40 per day for 2 or more days.

4.5 If the Licence Fee is not paid on the due date then the Licensee will pay to the Licensor Interest on the outstanding money.

5. Use

5.1 The Licensee will use the Property for the Permitted Use and for no other purpose.

5.2 The Licensee will not do or permit to be done upon or in connection with the Property anything which would be a legal nuisance or cause of damage to the Licensor or the other occupiers of any neighbouring premises or both.

5.3 The Licensee will comply with:

5.3.1 all statutes, bye-laws and other regulations affecting the Property or the Licensees' use of the Property;

5.3.2 all obligations, restrictions, reservations and other conditions in the titles of the Property; and

5.3.3 all reasonable regulations which may be issued from time to time by the Licensor or her agents in relation to the Property, including in respect of health and safety, risk management and security.

6. Indemnity and insurance

6.1 The Licensee will indemnify and keep indemnified the Licensors on demand from all liability in respect of:

6.1.1 any injury to or death of any person;

6.1.2 damage or loss which may be suffered by any persons by reason of or arising out of the use of the Property by the Licensee;

6.1.3 any breach by the Licensee of their obligations under the Licence; and

6.1.4 local authority rates and other costs associated with the occupancy of the Property.

6.2 The Licensee will take out insurance cover:

6.2.1 such as is necessary to give full indemnification to the Licensor in respect of the matters referred to at Clause 6.1; and

6.2.2 against public liability in at least the sum of £1,000,000 for each and every claim

and, in both cases, will produce written evidence of such insurance to the Licensor on demand.

6.3 The Licensee will not do anything which vitiates or makes void or voidable any insurance policy for the Property effected by the Licensor or the owner of the Property, or causes monies otherwise payable under such policy to be irrecoverable or refused or withheld, or an increased premium or loading to be payable in respect of such policy.

 

[Daniel Porter]

continuation of the contract

1. Alienation

1.1 The Licence is personal to the Licensee and the Licensee will not (either wholly or partially) assign, sub-let, part with or share occupation or otherwise deal in any way with their interest in the Licence.

2. Condition

2.1 The Licensee accepts the Property in its present condition as being fit in all respects for the Permitted Use.

2.2 The Licensee will:

2.2.1 keep the Property clean and tidy and will assist with the cleaning of the communal areas including the kitchen and bathroom; and

2.2.2 be responsible for the removal and disposal of waste; and

2.2.3 leave the Property in such condition at the Date of Termination;

all to the satisfaction of the Licensor (acting reasonably).

2.3 If the Licensees fail to carry out any matters for which they are responsible in terms of the Licence after a written demand has been made by the Licensor, the Licensor may carry out such matters (without prejudice to their other rights including their rights to terminate the Licence) and the Licensee will pay to the Licensor on demand the whole proper costs incurred by the Licensor in so doing, together with Interest.

2.4 The Licensor will have no liability to repair, maintain, renew or replace the Property.

3. Alterations

3.1 The Licensee will not carry out any alterations or additions to the Property without the prior written approval of the Licensor

3.2 To the extent requested by the Licensor, the Licensee will remove any alterations and additions carried out by them and reinstate the Property at the Date of Termination to the condition they were in before such alterations and/or additions were made.

4. Early termination

If:

4.1 any sums due under the Licence [(including the Licence Fee)] or any part of them are not paid on the due dates, or

4.2 the Licensee fail to implement any of their other obligations under the Licence, or

4.3 the Licensee:

4.3.1 goes into liquidation, receivership or administration;

4.3.2 sign a trust deed for creditors, are sequestrated or enter into a voluntary arrangement;

4.3.3 become insolvent or apparently insolvent; or

4.3.4 are wound up or dissolved

then, in each case, the Licensor may, at their option, at any time by notice in writing to the Licensee terminate the Licence with effect from the date specified in the notice but reserving to the Licensor their right of action in respect of any antecedent breach of the Licensee’s obligations.

5. Notices

5.1 Any notice, demand, request or certificate required under the Licence must be in writing and may be delivered personally or sent by post to the relevant Party using the relevant details

5.2 Any notice, demand, request or certificate will be deemed to be received:

5.2.1 if delivered personally, (with proof of delivery) at the time of delivery; and

5.2.2 if sent by recorded delivery post, 48 hours after the date of posting; and

Provided that if, in the case of personal delivery such delivery occurs outside normal business hours on a Working Day or on a day which is not a Working Day, delivery will be deemed to occur on the next Working Day.

6. No Liability

The Licensor is not liable to the Licensee for any loss, injury or damage which the Licensee may sustain from a deficiency in any part of the Property or the death of or injury to any person or for damage to any property or for any losses, claims, demands, actions, proceedings, damages, costs or expenses or other liability incurred by the Licensee in the exercise or purported exercise of the rights conferred on the Licensee under the Licence.

7. Formal Documentation

7.1 Neither the Licensee nor the Licensor will be bound by any acceptance of this offer or any other letter purporting to form part of the Licence or any amendment or variation of the Licence unless it is duly executed.

7.2 The Licence represents the entire agreement between the Parties relating to the licence of the Property and supersedes any previous agreements between the Parties relating to it. Neither of the Parties has been induced to enter into the Licence on account of any prior warranties or representations made which are not embodied in the Licence and no representation, warranty or undertaking of any description in respect of the Property, whether in relation to title, state of repair, compliance with statutes or other matters, the existence of local authority or other proposals or orders, or otherwise, is given in the Licence except insofar (if at all) as expressly stated in the Licence.

8. Proper Law and Prorogation

The Licence and the rights and obligations of the Licensor and the Licensee are governed by and are to be construed in accordance with the law of England and the Licensor and the Licensee are deemed to have agreed to submit to the non-exclusive jurisdiction of the English courts.

 

[Mark T Jones]

continuation of the contract

1. Alienation

1.1 The Licence is personal to the Licensee and the Licensee will not (either wholly or partially) assign, sub-let, part with or share occupation or otherwise deal in any way with their interest in the Licence.

2. Condition

2.1 The Licensee accepts the Property in its present condition as being fit in all respects for the Permitted Use.

2.2 The Licensee will:

2.2.1 keep the Property clean and tidy and will assist with the cleaning of the communal areas including the kitchen and bathroom; and

2.2.2 be responsible for the removal and disposal of waste; and

2.2.3 leave the Property in such condition at the Date of Termination;

all to the satisfaction of the Licensor (acting reasonably).

2.3 If the Licensees fail to carry out any matters for which they are responsible in terms of the Licence after a written demand has been made by the Licensor, the Licensor may carry out such matters (without prejudice to their other rights including their rights to terminate the Licence) and the Licensee will pay to the Licensor on demand the whole proper costs incurred by the Licensor in so doing, together with Interest.

2.4 The Licensor will have no liability to repair, maintain, renew or replace the Property.

3. Alterations

3.1 The Licensee will not carry out any alterations or additions to the Property without the prior written approval of the Licensor

3.2 To the extent requested by the Licensor, the Licensee will remove any alterations and additions carried out by them and reinstate the Property at the Date of Termination to the condition they were in before such alterations and/or additions were made.

4. Early termination

If:

4.1 any sums due under the Licence [(including the Licence Fee)] or any part of them are not paid on the due dates, or

4.2 the Licensee fail to implement any of their other obligations under the Licence, or

4.3 the Licensee:

4.3.1 goes into liquidation, receivership or administration;

4.3.2 sign a trust deed for creditors, are sequestrated or enter into a voluntary arrangement;

4.3.3 become insolvent or apparently insolvent; or

4.3.4 are wound up or dissolved

then, in each case, the Licensor may, at their option, at any time by notice in writing to the Licensee terminate the Licence with effect from the date specified in the notice but reserving to the Licensor their right of action in respect of any antecedent breach of the Licensee’s obligations.

5. Notices

5.1 Any notice, demand, request or certificate required under the Licence must be in writing and may be delivered personally or sent by post to the relevant Party using the relevant details

5.2 Any notice, demand, request or certificate will be deemed to be received:

5.2.1 if delivered personally, (with proof of delivery) at the time of delivery; and

5.2.2 if sent by recorded delivery post, 48 hours after the date of posting; and

Provided that if, in the case of personal delivery such delivery occurs outside normal business hours on a Working Day or on a day which is not a Working Day, delivery will be deemed to occur on the next Working Day.

6. No Liability

The Licensor is not liable to the Licensee for any loss, injury or damage which the Licensee may sustain from a deficiency in any part of the Property or the death of or injury to any person or for damage to any property or for any losses, claims, demands, actions, proceedings, damages, costs or expenses or other liability incurred by the Licensee in the exercise or purported exercise of the rights conferred on the Licensee under the Licence.

7. Formal Documentation

7.1 Neither the Licensee nor the Licensor will be bound by any acceptance of this offer or any other letter purporting to form part of the Licence or any amendment or variation of the Licence unless it is duly executed.

7.2 The Licence represents the entire agreement between the Parties relating to the licence of the Property and supersedes any previous agreements between the Parties relating to it. Neither of the Parties has been induced to enter into the Licence on account of any prior warranties or representations made which are not embodied in the Licence and no representation, warranty or undertaking of any description in respect of the Property, whether in relation to title, state of repair, compliance with statutes or other matters, the existence of local authority or other proposals or orders, or otherwise, is given in the Licence except insofar (if at all) as expressly stated in the Licence.

8. Proper Law and Prorogation

The Licence and the rights and obligations of the Licensor and the Licensee are governed by and are to be construed in accordance with the law of England and the Licensor and the Licensee are deemed to have agreed to submit to the non-exclusive jurisdiction of the English courts.

To save everyone the effort of reading through an entire agreement, can you clarify exactly where / how it seems 'wrong'?

 

[Daniel Porter]

These are the clauses that are not sitting quite right with me. I would like a bit of clarification on them, as I have other contracts in place and none of them were this in-depth am I being overly cautious?

Clause 4 Payments
The Licensee will pay the Licence Fee to the Licensor by equal instalments in advance on the first day of each month, the first payment being due on the Date of Entry in respect of the period from the Date of Entry to the next payment date, and monthly after that, by bank transfer if so required by the Licensor.

The Licensee if using the room permanently will pay £395 per month on the 25th of each month.

If the Licensee is using the room “ad hoc” the payment will be paid on booking. Payments are as follows: 1 hour to 3 hours : £12.50 per hour, 4 hours (half day) £30, One day £50

If the Licensee uses the room for regular days the payments will be paid in advance, per month. The fee being: £45 per day for one day, £40 per day for 2 or more days.

If the Licence Fee is not paid on the due date then the Licensee will pay to the Licensor Interest on the outstanding money.

Clause 6 Indemnity and Insurance
The Licensee will indemnify and keep indemnified the zs on demand from all liability in respect of:
any injury to or death of any person;

damage or loss which may be suffered by any persons by reason of or arising out of the use of the Property by the Licensee;

any breach by the Licensee of their obligations under the Licence; and
local authority rates and other costs associated with the occupancy of the Property.
The Licensee will take out insurance cover:

such as is necessary to give full indemnification to the Licensor in respect of the matters referred to at Clause 6.1;
and
against public liability in at least the sum of £1,000,000 for each and every claim
and, in both cases, will produce written evidence of such insurance to the Licensor on demand.

The Licensee will not do anything which vitiates or makes void or voidable any insurance policy for the Property effected by the Licensor or the owner of the Property, or causes monies otherwise payable under such policy to be irrecoverable or refused or withheld, or an increased premium or loading to be payable in respect of such policy.

Clause 8 Condition
If the Licensees fail to carry out any matters for which they are responsible in terms of the Licence after a written demand has been made by the Licensor, the Licensor may carry out such matters (without prejudice to their other rights including their rights to terminate the Licence) and the Licensee will pay to the Licensor on demand the whole proper costs incurred by the Licensor in so doing, together with Interest.

The Licensor will have no liability to repair, maintain, renew or replace the Property.

Clause 12 No Liability
The Licensor is not liable to the Licensee for any loss, injury or damage which the Licensee may sustain from a deficiency in any part of the Property or the death of or injury to any person or for damage to any property or for any losses, claims, demands, actions, proceedings, damages, costs or expenses or other liability incurred by the Licensee in the exercise or purported exercise of the rights conferred on the Licensee under the Licence.

 

[deniser]

It's not clear as to which days you want to rent the room.

 

[Maxwell83]

These are the clauses that are not sitting quite right with me. I would like a bit of clarification on them, as I have other contracts in place and none of them were this in-depth am I being overly cautious?

Clause 4 Payments
The Licensee will pay the Licence Fee to the Licensor by equal instalments in advance on the first day of each month, the first payment being due on the Date of Entry in respect of the period from the Date of Entry to the next payment date, and monthly after that, by bank transfer if so required by the Licensor.

The Licensee if using the room permanently will pay £395 per month on the 25th of each month.

If the Licensee is using the room “ad hoc” the payment will be paid on booking. Payments are as follows: 1 hour to 3 hours : £12.50 per hour, 4 hours (half day) £30, One day £50

If the Licensee uses the room for regular days the payments will be paid in advance, per month. The fee being: £45 per day for one day, £40 per day for 2 or more days.

If the Licence Fee is not paid on the due date then the Licensee will pay to the Licensor Interest on the outstanding money.

Clause 6 Indemnity and Insurance
The Licensee will indemnify and keep indemnified the zs on demand from all liability in respect of:
any injury to or death of any person;

damage or loss which may be suffered by any persons by reason of or arising out of the use of the Property by the Licensee;

any breach by the Licensee of their obligations under the Licence; and
local authority rates and other costs associated with the occupancy of the Property.
The Licensee will take out insurance cover:

such as is necessary to give full indemnification to the Licensor in respect of the matters referred to at Clause 6.1;
and
against public liability in at least the sum of £1,000,000 for each and every claim
and, in both cases, will produce written evidence of such insurance to the Licensor on demand.

The Licensee will not do anything which vitiates or makes void or voidable any insurance policy for the Property effected by the Licensor or the owner of the Property, or causes monies otherwise payable under such policy to be irrecoverable or refused or withheld, or an increased premium or loading to be payable in respect of such policy.

Clause 8 Condition
If the Licensees fail to carry out any matters for which they are responsible in terms of the Licence after a written demand has been made by the Licensor, the Licensor may carry out such matters (without prejudice to their other rights including their rights to terminate the Licence) and the Licensee will pay to the Licensor on demand the whole proper costs incurred by the Licensor in so doing, together with Interest.

The Licensor will have no liability to repair, maintain, renew or replace the Property.

Clause 12 No Liability
The Licensor is not liable to the Licensee for any loss, injury or damage which the Licensee may sustain from a deficiency in any part of the Property or the death of or injury to any person or for damage to any property or for any losses, claims, demands, actions, proceedings, damages, costs or expenses or other liability incurred by the Licensee in the exercise or purported exercise of the rights conferred on the Licensee under the Licence.

There are a lot of things I would not like in clauses 6, 8 and 12 if I were simply licencing a room in a building. In brief, the demands on the licensee are too onerous and the obligations of the licensor are insufficient.

Are they willing to make amendments? If not, you simply have to take a view on it - can you go elsewhere? Is it worth taking the risk of something going wrong? etc etc

 

[The Byre]

The Licensor will have no liability to repair, maintain, renew or replace the Property.

That is the one bit I would want to see struck out. We rent out property, both commercial and private and quite honestly, it is our job to ensure that the properties are maintained.