Legal advice: Property alterations

Even tenants who are on a very long lease have no guarantee that the owner will permit alterations.

By Keith Miller of thePublican.com's team of legal experts from London solicitors Joelson Wilson.​

You may think that if you hold a 999-year lease which allows you to carry out alterations with the landlord's consent you should be fairly free to do what you like. A recent case shows, however, that you should not be so confident.

The premises in question were situated on the ground floor. The lease contained a covenant disallowing alteration of the premises without the landlord's consent, which could not be unreasonably withheld. The tenant wanted to convert the ground floor into a restaurant and applied to the landlord for consent.

However, the landlord wanted to convert the upper part of the building into residential flats and the tenant's proposals were turned down on a number of grounds. One was that the landlord was worried that the rest of the building might suffer structural damage as a result of the ground floor alterations.

In giving judgment, the court applied a number of rules:

• The landlord has certain property interests which he is allowed to protect. If the tenant's proposals for alterations are likely to damage those property interests, he can refuse consent
• The tenant has to prove that the landlord has been unreasonable. Even if the conclusions reached by the landlord cannot be justified, it does not necessarily mean the landlord is acting unreasonably.

If the lease allows the tenant to change the use of the ground floor to a restaurant, there may still be reasonable grounds for the landlord to refuse consent, such as lack of provision for preventing cooking smells, which would put off prospective buyers of the landlord's flats. In the case in question, the tenant's plans failed to show that the upper floors would be adequately supported.

The morals to be drawn from this case are:

• A very long lease which attracts a premium price should not be made too restrictive
• If premises are being bought for a particular use and alterations to convert the premises are necessary, no commitments should be made until the landlord has given consent
• Plans and specifications put forward for approval should provide the fullest possible information. Then the landlord - who has to respond quickly to the application for consent - should not be able to draw incorrect conclusions.

If you wish to carry out structural alterations to premises already licensed under the Licensing Act 1964 it is quite likely that you will require advance consent from the licensing justices according to section 20 of that Act. Do not forget to seek entirely separate consent from your local council if your premises has a public entertainment licence.