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The ADR approach in lease renewal disputes

The changing economic climate means that arbitration is increasingly becoming a preferred method of dispute resolution in lease renewals, explains Paul Rose

21 July 2014

Body text Contested statutory commercial lease renewals, unlike rent reviews, are usually dealt with by the courts being subject to the Landlord and Tenant Act 1954 (as amended). These disputes fall into two principal categories, namely the terms of the new lease and the rent. It is common knowledge that the majority of court time spent on these disputes focuses on the expert rental evidence but there is often considerable discord about the terms of the new lease.

In commercial rent reviews, contested rental opinion can be settled by arbitration or expert determination. What is less well known is that there are institutional schemes that have been created with a view to reducing court time and costs in lease renewals. It has been suggested that the infrequent use of these schemes is a desire by larger landlords to retain the threat of the costs of court proceedings to support their negotiating position. However, since arb...

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