Time of the Essence and the Mannai Principle
Break clauses are time of the essence — a fundamental rule that distinguishes break clauses from rent review timetables (which are generally not time of the essence under United Scientific Holdings [1978]). Every deadline is absolute: the notice must be served on or before the specified date, to the specified recipient, by the specified method. A notice served one day late is ineffective and the right to break is permanently lost for that break date. Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] HL: a break notice is not invalid merely because of a minor error (e.g. specifying a date one day out) provided a reasonable recipient with knowledge of the lease terms would have been in no doubt about the meaning and effect of the notice. This is a narrow exception — errors as to the break date, the parties, or the demised premises are more likely to be fatal.
Conditions Precedent — Vacant Possession, Rent, and Covenant Compliance
Vacant possession: PCE Investors Ltd v Cancer Research UK [2012] EWHC — tenant must hand back premises free of any person, chattel, or encumbrance; even trivial items left behind can defeat the break; Riverside Park v NHS Property Services [2016] — extends to entire demise including car parks and external areas; no subtenant or licensee remaining. Rent condition: all rent (and possibly service charge, insurance rent) due up to the break date must be paid; Marks and Spencer plc v BNP Paribas Securities Services [2015] SC — no implied right to recover quarterly rent paid in advance for the period after the break date; express apportionment provision required. Covenant compliance: 'all covenants performed' condition — any breach may defeat the break; 'material breach' condition — courts construe materiality objectively; a minor disrepair item may not be material. Serve notice by the prescribed method; keep all proof of service; serve by multiple methods if in doubt.