Derbyshire Tenant’s Right To Renew Pub Lease

4 Mar 2014

Enterprise Inns must accept it has no legal basis to evict a Derbyshire pub tenant next month who has not opted out of legal tenancy rights as claimed. This is a deliberate misrepresentation to the pub tenant where Enterprise tries to get round the law and bully the tenant into signing a lease with an extortionate rent increase without justification says GMB.
GMB, the union for tied pub tenants, is calling on Enterprise Inns, freeholders of the Patternmakers Arms, Duffield in Derbyshire to accept that it has no legal basis to evict Claire Muldoon, the tied tenant next month unless she agrees to a 42% rent increase. Claire is currently on a 5 year agreement with a renewal review date April 2014. Mr Ashley Lovett, the Enterprise Inns regional manager incorrectly told Claire that she had opted out of her rights to renew her lease under The Landlord and Tenancy Act and that she has no automatic right to renewal. Mr Lovett offered her a new tenancy with an increased rent, from £16,470 to £23,450, an increase of 42%. The alternative offered was to vacate the pub.

GMB checked out the legal position under the Regulatory Reform (Business Tenancies) (England and Wales) Order 2003. Under Part 22 of the Order, any agreement to contract out is void if notice isn’t served in prescribed form, and complies with the basic requirements - essentially, agreement to be served on tenant and tenant to agree in writing before commencement of the term of the lease. GMB has checked Claire’s lease and the paperwork. No Section 25 notice has been served by Enterprise. It is clear that Claire had not signed the Schedule 1 which is a requirement along with the co signature of a solicitor. Accordingly Sections 24 - 28 of the Landlord and Tenancy Act still applies and Claire has a right to renew her lease.

There has been considerable public interest in this case. GMB wrote to Vince Cable highlighting the rent demand.  Local Conservative MP Pauline Latham raised the case in a Parliamentary Debate which Dr Cable described as “truly shocking”. There was a public meeting attended by over 100 people. After that the MP presented a petition on behalf of the local residents, to Dr Cable.

Dave Mountford, GMB Branch Secretary for tied pub tenants, said “As Enterprise has admitted other blunders on rent reviews I thought it was worth checking out whether Claire had actually opted out of the Landlord and Tenancy Act. We only had Enterprises Area Manager’s word that she had. I was aware that opting out is not a simple issue and took legal advice. I was advised that the Regulatory Reform (Business Tenancies) (England and Wales) Order 2003 is critical. 

Under Part 22 of the Order, any agreement to contract out is void if notice isn’t served in prescribed form, and complies with the basic requirements - essentially, agreement to be served on tenant and tenant to agree in writing before commencement of the term of the lease. Upon checking Claire’s lease it is clear that Claire had not signed the Schedule 1 which was a requirement along with the co signature of a solicitor.

As this was clearly the case Sections 24 - 28 of the Landlord & Tenancy Act still applies. As no Section 25 notice has been served by Enterprise they will simply have to grant a new tenancy on same terms as old   -  simply put Claire’s tenancy will roll over for a further 5 years. Enterprise has consistently refused to meet with myself and Claire to discuss this issue. This is despite three written requests for a meeting to the Operations Director Chris Jones.

We have a nonsense position where Enterprise recommends that their tenants take advice but then refuses to allow the tenants to avail of the advice when it is given by GMB. Had they done so Claire could have saved herself and a lot of other people a considerable amount of wasted time. You have to question the honesty and transparency which Enterprise has shown in this appalling mess.”

Maria Ludkin, GMB National Officer for Legal and Corporate Affairs, said “Once again we see a deliberate misrepresentation to the pub tenant, where Enterprise tries to get round the law and bully the tenant into signing a lease with an extortionate rent increase, without justification”.
Claire Muldoon added “I’m obviously pleased that we know where we stand and perhaps Enterprise can finally stop asking me for a new business plan and also stop showing people around. I just wish they had not put me and the community through such a trial – it’s been such a huge waste of my time”

Contact Claire Muldoon, Pattenmakers Arms, 4 Crown Street, Duffield 01332 842844 or Dave Mountford GMB branch secretary for tied pub tenants 07792 198 954 or 07794 021212 or Steve Kemp 07730 898102