Break notice

A break notice in a commercial lease is a notice which either or sometimes both a landlord or tenant can serve on the other to terminate the lease before the contractual expiry date under the lease.

E.g.: In Marks and Spencer plc v BNP Paribas Services Trust Company (Jersey) Limited and another [2015] in was established by court that Clause 8 entitled M&S to determine the Lease on 24 January 2012 by giving BNP six months’ prior written notice (a “break notice”).

Break clause

A break clause is a tool in the lease agreement that allows the landlord, tenant or both to end a lease early without facing a penalty. It includes an agreed date when the lease can be ended. To use a break clause, party must give the other party notice (“break notice”). The party may need to meet other conditions, for example paying the rent by an agreed date. A landlord can only end a lease early without a break clause when the tenant fails to pay rent or meet other lease obligations.

E.g.: Due to the complexity and potential risks involved, it is strongly recommended that clients seek professional legal advice regarding any possible break clause.