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Commercial Property Law

Tenancy at Will for Landlords UK

Tenancy at will in commercial property: either party can determine without notice; no LTA 1954 Part II security of tenure (Hagee (London) v AB Erikson and Larson [1976] QB 209); arises during lease negotiations (pre-lease occupation) or on holding over; conversion risk — accepting periodic rent payments converts to periodic tenancy with LTA 1954 protection; documentation; tenancy at will vs contracted-out tenancy (s.38A RRO 2003); Scotland tacit relocation.

9 min readUpdated 7 June 2026Last reviewed: 17 May 2026tenancy-at-willlta-1954commercial-leasesecurity-of-tenure

What Is a Tenancy at Will?

Tenant occupies with landlord's consent; no fixed term; no periodic rental obligation; either party can end immediately without notice. Hagee (London) v AB Erikson and Larson [1976] QB 209: genuine tenancy at will carries no LTA 1954 Part II security of tenure. Typically arises: pre-lease occupation; holding over while negotiating renewal; buyer in early occupation pre-completion.

When Does a Tenancy at Will Arise?

Pre-lease occupation: new tenant enters premises during lease negotiation before formal lease executed. Holding over: existing lease expires; parties negotiating renewal; tenant remains with consent. Pre-completion occupation: buyer permitted early occupation before purchase completes. Implied at will: can arise by implication from circumstances — label applied by parties is not conclusive.

The Conversion Risk — Periodic Tenancy

Accepting monthly payments of a regular sum from a business tenant in at-will occupation may convert the arrangement to a monthly periodic tenancy attracting LTA 1954 security of tenure. Objective test: court looks at all circumstances. Risk factors: regular monthly payments; extended occupation without new agreement; no written documentation. Preserve at-will: document in writing; express payments as mesne profits not rent; set review date for formal lease.

Tenancy at Will vs Contracted-Out Tenancy

Tenancy at will: no formalities; immediate termination; no LTA 1954 risk — but vulnerable to periodic tenancy conversion. Contracted-out tenancy (s.38A LTA 1954; RRO 2003): warning notice + declaration + lease recital; clear end date; no security of tenure risk. For pre-lease periods of weeks: at will with clear documentation appropriate. For longer periods: excluded tenancy safer.

Scotland and Northern Ireland

LTA 1954 Part II applies only in England and Wales — Scotland and NI have different regimes. Scotland: commercial leases expire on contractual date; tacit relocation: if neither party gives 40 days' notice before expiry, lease continues on same terms for further year — landlords must serve notice to quit in good time. NI: Business Tenancies (NI) Order 1996 — broadly equivalent to LTA 1954.

Frequently asked questions

What is a tenancy at will?+

A form of commercial property occupation where the tenant occupies with the landlord's consent, with no fixed term and no periodic rental obligation. Either party can end it immediately without notice. It carries no LTA 1954 security of tenure (Hagee (London) v AB Erikson [1976]). Commonly used during lease negotiations when the tenant enters premises before the formal lease is signed.

How can a tenancy at will convert to a periodic tenancy?+

If the landlord accepts monthly rent from a business tenant in at-will occupation, a court may find the arrangement has become a monthly periodic tenancy with LTA 1954 security of tenure. Prevent this by documenting the arrangement in writing, expressing payments as mesne profits (not rent), and progressing towards a formal lease without extended delay.

Should I use a tenancy at will or a contracted-out tenancy?+

For very short pre-lease periods (a few weeks), a tenancy at will with clear written documentation is straightforward. For longer periods, a short excluded tenancy under LTA 1954 s.38A (with warning notice and declaration) provides more certainty and eliminates the conversion risk. Both are preferable to undocumented holding over.

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