A commercial lease is often a complicated and lengthy document. It deals with a wide variety of subject matters, from basic details such as the names of the parties, a description of the property and the fixed term (length) of the lease; to more complex issues such as the rights, obligations and remedies of both landlord and tenant, calculation of service charges and rent reviews.
Generally, the contents and presentation of a lease do not have to follow any prescribed form or structure. Therefore, how the lease is presented will vary depending on the particular style of its author.
However, generally a well-drafted lease should begin with a contents page and the lease itself will be ordered as follows:
Depending on how the lease has been drafted, the next part would contain the names and addresses of the parties.
The majority of leases contain a section defining particular words which are repeatedly used in the document and bear a specific meaning. It is convenient to define these words under a definition section so avoid needless repetition of recurring words and phrases. Words that have been defined will start with a capital letter so that they are easily identified in the lease.
In a commercial lease, it is common to define the following words:
Leases also contain a small section to clarify any potential issues regarding its interpretation, such as confirming that any references to a particular gender are also references to the other, or that the reference to an Act of Parliament also includes an amendment or modification of it. These are usually standard clauses which appear in most commercial agreements.
This part of the lease will specifically refer to the landlord granting a lease of the property to the tenant for the specified term, together with certain other rights, on the condition that the tenant pays the rent and complies with various obligations (promises to do or not to do certain things). The landlord will also reserve certain rights and servitudes (a right to use someone else's land for a specific purpose, e.g. to walk on their pathway) for their benefit. A list specifying the rights and obligations for each party would usually be found in separate schedules.
Most of the detail of a lease can be found in its schedules. The following matters are usually contained in schedules:
Grouped together under the heading of provisos are a variety of clauses that cannot be easily dealt with elsewhere in the lease. These clauses are neither in the nature of obligations nor servitudes. Sometimes the provisos are contained in a separate schedule of their own. Examples of provisos include:
This page will contain the details of the parties and appropriate wording (which differs depending on whether a party is an individual or company) so that the lease can be signed by the parties. If a party is an individual, their signature must be witnessed by an independent adult witness who must also sign the lease and print their full name, address and occupation on it. The date of signing by each party is also detailed here.