Reforming the Landlord & Tenant Act 1954: What the Law Commission Is Proposing

chris mcg
2 days ago
2 min read

The Law Commission has officially turned its attention to one of the cornerstones of UK commercial property law: the Landlord & Tenant Act 1954. Nearly 70 years old and last reviewed two decades ago, the Act is now under serious consideration for modernisation. But this is not just a legal technicality – it could reshape how shops, offices and hospitality spaces are leased across the country.

Why Is the Act Being Reviewed?

The world the 1954 Act was built for – long leases, stable high streets and local customer loyalty – has largely disappeared. Today’s market is defined by:

Shorter, flexible lease terms (often under 2 years)
Online retail and hybrid working reducing demand for traditional space
ESG and sustainability obligations now central to corporate strategy
Tenants and landlords both seeking agility rather than permanence

The Law Commission has listened to mounting evidence from practitioners that the Act is bureaucratic, inflexible and prone to technical traps – particularly when it comes to notices and renewal procedure.

What Has the Law Commission Said So Far?

In its September 2024 interim statement, the Commission made it clear:

The 1954 Act will not be abolished – full repeal was rejected as too risky for smaller tenants.
But the Act will be significantly modernised to reflect today’s leasing market.

The Direction of Reform (Provisional Conclusions)

The Commission has already signalled some key changes that are likely to happen:

1. A SIMPLER, DIGITAL RENEWAL SYSTEM

The current system of strict paper notices and “gotcha” technicalities is expected to go. The Commission is exploring a digital portal for renewal and termination – more like Companies House than archaic statutory forms.

2. EASIER OPT-OUT FOR SOPHISTICATED PARTIES

The current statutory declaration process is seen as excessive. A clear, streamlined opt-out mechanism is likely to replace it.

3. REDEFINING WHO GETS PROTECTION

Currently, leases under 6 months are outside the Act – a rule from a very different era. The Commission is considering moving this threshold to up to two years, to reflect the rise of pop-ups, short licences and test-trading models.

4. ALLOWING MODERN LEASE TERMS AT RENEWAL

At present, the courts are reluctant to allow ‘new’ ESG or flexibility-based clauses on renewal unless both parties agree. Reform is expected to allow easier insertion of Net Zero, sustainability or pandemic-proof clauses.

What Hasn’t Been Decided Yet?

The second consultation (due 2025) will look at unresolved issues, such as:

Should turnover rents be imposed by courts?
Should landlords gain more flexible early termination rights?
Should redevelopment ground (f) be redefined for modern regeneration?

Why This Matters

The 1954 Act still governs around half a million commercial tenancies. Any reform will affect developers, investment funds, local high streets, growing SMEs and national retail chains alike. The direction of travel is clear: retain tenant protection, but remove procedural traps and embrace commercial flexibility.

This is likely to be the most significant update to UK commercial leasing law in a generation – and it is now moving fast.