The Minister for Justice and Equality has published a draft Landlord and Tenant Law Reform Bill.

The Bill is a follow on to the Land and Conveyancing Law Reform Act 2009 and has the similar objective of repealing various archaic pieces of legislation and of streamlining landlord and tenant law under one act going forward.  While much of the Bill is common sense and brings the law in line with modern practice and developments in the UK, there are radical proposals which fundamentally change existing law.  

The most significant change is to the area of landlords’ consent to applications by tenants to assign, sublet, alter or change the use of the property.  Under the proposed new law, the onus is transferred to the landlord to show that it is not acting unreasonably, the landlord will be liable for damages if found to have been unreasonable and the landlord must make a decision on an application for consent within 21 days.  If implemented, these proposals will radically alter the balance of power between landlord and tenant in consent applications.

Another important change is to the area of lease renewals where a tenant will be entitled to a maximum 10 year renewal lease (as opposed to 20 years currently) or such lesser period as the parties agree.  The requirement that the tenancy relates to a building is being changed so that any premises used for business purposes (whether built upon or not) will qualify.  A very welcome change is that the parties will be entitled to opt for arbitration if they cannot agree the terms of a new lease rather than have the Court fix the terms.  The blanket exemption for the State as landlord is to be heavily watered down and now, if the State wishes to resist a renewal, it will have to certify that it is not in the public interest for a tenant to have renewal rights.

The Bill proposes other wide ranging reforms to the areas of frustration and repudiation of leases, variations to leases, termination of leases and tenants’ fixtures.  It is likely that some of these will be dropped from the final legislation enacted as in certain cases they do little to clarify the existing law and leave room for ambiguity.  

The Bill does not deal with the proposed ban on upward only rent review clauses in existing leases and that will be dealt with by way of separate draft legislation to be published later in the year.

Contributed by Andrew Muckian.

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