Richard Nicholas highlights the top ten rules of break clauses.

1. The top ten rules of break clauses
In house lawyers forum – spring 2013

2. • there is no breach of the lease too
small, too technical or too unfair on the
tenant that it will not lose the tenant its
right to break if the break is conditional
on full compliance with the tenant’s
covenants

3. • the same goes for requirements under a
lease that the break notice is served at
a particular address, by a particular
person, on a particular person, or by a
particular mode of service. Every single
word of the break clause relating to
service must be strictly complied with

4. • likewise for requirements under a lease
that the break notice is to be served or
payments are to be made or covenants
are to be complied with or vacant
possession is to be given, by a certain
time or before a certain date

5. • the only reliable exception to the first
rule occurs when the break clause is
expressly conditional only on
‘substantial’ or ‘material’ compliance
with tenant’s covenants

6. • the landlord’s motive for trying to
defeat the break is irrelevant - this is a
legal way of saying that no basis for
resisting the exercise of a break will fail
for being too cynical

7. • the presence in the lease of a liability to pay
money ‘whether demanded or not’ means
that it will be the tenant who will have to
calculate and pay the amount owing, if the
break clause is conditional on all sums due
under the lease having been paid

8. • small errors in the wording of the break
notice will not necessarily render it
ineffective if the reasonable recipient
would nevertheless be able correctly to
ascertain what the tenant meant to
write

9. • a tenant who believes that it has
complied with the conditions attached
to the break should tell its landlord of
that belief and ask the landlord to
confirm whether it agrees, and if not,
why not

10. • where the giving of vacant possession is
a condition of the break clause, strict
compliance with the condition does not
mean the tenant has to leave the
premises 100% pristine to satisfy the
condition

11. • the workings of the above rules will
always be subject to modification
depending on the terms of the lease

12. Get in touch if you have any questions or
would like further information.
t +(0)121 237 3992
e richard.nicholas@brownejacobson.com