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Unopposed Lease Renewals – a need for speed?

From 1 December 2017, there will be a year-long pilot scheme for unopposed lease renewals that are issued in the County Court at Central London (CCLC).  All claims will be transferred to the First Tier Tribunal (Property Chamber) (the FTT) in London.

The main aim of this is to “ensure that all cases proceed to a final determination as smoothly and as quickly as possible“.

Significant changes to the current process

1. From the issue of proceedings until the final hearing should take just 20 weeks – there is no allowance to stay the claim except for a one-off three month stay at the beginning for PACT referral, mediation etc.

2. There is no Case Management Conference – once the proceedings have been issued (if no initial three month stay is agreed) the FTT’s standard directions kick in.

3. These directions only allow for one round of tenant’s amendments to the draft lease.

4. They do not allow for witness statements of fact.

5. The valuation experts are to exchange comparable evidence on market rent at an early stage – prior to solicitors having agreed on which terms of the lease are in dispute!

6. The judge will always sit with a valuer/assessor (London valuers will not be allowed to sit due to potential conflicts).

Benefits

The main benefits appear to be:-

1. the judge will have greater knowledge of property matters, including business tenancies, and there will be a valuer/assessor at the hearing;

2. if valuation is the only issue, the FTT may consider written submissions rather than an oral hearing; and

3. no excuses for parties to drag their heels, or drag out the proceedings for tactical purposes.

Parties should be prepared for the fact that once proceedings are issued, they are going to have to work extremely quickly on getting the draft lease agreed.  They should therefore be proactive with their negotiations from the moment a notice is served.  Additionally, it would be sensible for a draft lease to be submitted as soon as reasonably practicable and not left until directions are in place.

A point to note is that should a party wish to use this pilot scheme and issue proceedings at the CCLC when the property is not in London, it will be sent back to the county court venue which has jurisdiction.  Additionally, any interim applications still need to be issued out of CCLC and transferred from there to the FTT.