Section 26 Notice explained - (Landlord & Tenant Act 1954, S26)

A Section 26 Notice is used in England and Wales by a tenant that wishes to renew a commercial lease.

This form is for use by a tenant with a commercial lease in England or Wales. There is no Scottish equivalent.

The Landlord and Tenant Act 1954 broadly gives business tenants security of tenure - the right to renew the tenancy when it comes to an end. Landlords can oppose renewal of the tenancy for certain limited, specific reasons, for example: failure to pay rent, or if the landlord wants to redevelop the premises or get them back for his own use. Landlords can either apply to the court to end the tenancy, or can oppose the tenant's application for renewal.

To request a new tenancy and propose terms for renewal the tenant would need to send the landlord a Section 26 Notice. This must be sent between 6 and 12 months before the tenant wants the new tenancy to commence - which itself must be after the normal expiry date of the lease. 
 It cannot be sent if the landlord has already sent a Section 25 Notice.

If the landlord is willing to renew the lease, the landlord will consider the tenant's proposals for a new tenancy set out in the Section 26 Notice. If both parties agree on the terms, the new tenancy will begin on the date set out in the Notice. 
If the parties cannot agree on the terms of a new tenancy, either party may apply to the court to order the grant of a new tenancy and settle the terms upon which they cannot agree.
If the landlord opposes a new tenancy the landlord must apply to the court to end the tenancy citing one or more of the specific reasons set out in the Landlord and Tenant Act 1954. The court will not order a new tenancy where the landlord successfully argues that one or more of the specific reasons apply. If the landlord is unsuccessful in opposing renewal, the court will order the grant of a new tenancy and settle its terms.

The landlord must respond to a tenant's Section 26 request within two months of receiving it if he wishes to oppose the grant of a new lease.

Please note that this form states that if the tenant may be entitled to acquire the freehold or an extended lease, then Form 7 in Schedule 2 to the Landlord and Tenant Act 1954, Part 2 (Notices) Regulations 2004 must be used instead of this form. This refers to situations where the tenant may have rights under the Leasehold Reform Act 1967 where the property is a "house" and the tenant is occupying it as such. We do not provide Form 7 since our commercial lease documents are intended for use with commercial premises such as offices, warehouses or workshops.

None of the above is applicable if the tenant and landlord had opted out of the Landlord and Tenant Act 1954 when the lease was first agreed.