IRELAND Law and Practice Contributed by: Diarmuid Mawe, Craig Kenny, Katelin Toomey and William Fogarty, Maples Group
6.16 Effect of the Tenant’s Insolvency Commercial leases usually include a provision entitling a landlord to terminate a lease by way of forfeiture if the tenant becomes insolvent. If the obligations of the tenant under the lease are guaranteed by a guarantor, the guarantor may be required to take a new lease on the same terms as the previous lease for the length of the term remaining. 6.17 Right to Occupy After Termination or Expiry of a Lease Where a commercial tenant has been in con - tinuous occupation for a minimum period of five years, it will obtain a statutory right to a new ten - ancy unless it has renounced its statutory rights. A lease term will expire automatically and so, while a landlord is not required to serve notice on a tenant to ensure the tenant vacates a prem - ises, in practice, where a deed of renunciation has not been executed by a tenant, a landlord will be in contact with the tenant to arrange an orderly yield-up of the premises and ensure the tenant’s compliance with the covenants in the lease and, in particular, with the repair and yield- up obligations. 6.18 Right to Assign a Leasehold Interest Usually, the provisions of a commercial lease contain restrictions on a tenant’s right to assign or sublet the lease without the landlord’s prior written consent. Under the LTA, a landlord can - not unreasonably withhold consent to the assign - ment or subletting of the entirety of a premises; this provision over-rides the contractual terms of any business lease. The assignment or sublet - ting of part of a premises is usually prohibited under the terms of a commercial lease.
large insurance group in Ireland in relation to the non-payout of proceeds in respect of business interruption insurance due to closures necessi - tated by the COVID-19 pandemic. The decision was presided over as a test case for the juris - diction and should offer greater clarity for policy drafters seeking to bring certainty regarding the level of risk assumed by insurers providing busi - ness interruption cover. 6.13 Restrictions on the Use of Real Estate A lease will contain a user clause outlining the permitted use of the property by the tenant. If a tenant wishes to change the permitted use, the consent of the landlord is generally required (legislation provides that such consent may not be unreasonably withheld). Any use by the ten - ant must also comply with the Planning Acts. 6.14 Tenant’s Ability to Alter and Improve Real Estate Depending on the provisions of the lease, a ten - ant may be permitted to alter or improve the property, usually subject to the landlord’s con - sent and the tenant’s obligations on yield-up of the premises, which normally include returning the property to its original condition. Structural alterations are generally prohibited, with internal non-structural alterations being permitted sub - ject to the prior written consent of the landlord. 6.15 Specific Regulations The RTA govern leases of residential property in Ireland, provided the term does not exceed 35 years. Any residential property for lease must meet certain standards under the Hous - ing (Standards for Rented Houses) Regulations 2019. The LTA govern leases of industrial, office, retail or hotel space.
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