Landlord and Tenant Act 1954 — section 37
Section 37 compensation calculator
Where a landlord successfully opposes renewal on one of the no-fault grounds — (e), (f) or (g) — the outgoing tenant is entitled to statutory compensation. It is a formula, not a negotiation: the rateable value of the holding multiplied by the appropriate multiplier, doubled where the business has been there for 14 years.
Your figures
Take the figure for the holding from the rating list at the date the section 25 notice or section 26 request was served. Where the holding is only part of a rated unit, an apportionment is needed.
Potential statutory compensation
Enter a rateable value to see an indicative figure. Nothing you enter leaves your browser.
Where this fits
Compensation only arises once opposition succeeds, so the prior question is always how strong the landlord's ground actually is. Test that first, then price the outcome.
Section 37 compensation — common questions
How is section 37 compensation calculated?
Compensation is the rateable value of the holding multiplied by the appropriate multiplier, which has been 1 since the Landlord and Tenant Act 1954 (Appropriate Multiplier) Order 1990. Where the tenant has been in business occupation for the whole of the 14 years ending on the date the tenancy ends, the rateable value is doubled under section 37(3).
When does the double multiplier apply?
Where the premises have been occupied for the purposes of a business, by the tenant or by a predecessor in the same business, for the whole of the 14 years ending with the termination of the current tenancy. Continuity of the business, not of the tenancy, is what matters.
Which grounds of opposition give rise to compensation?
Only the no-fault grounds: (e) uneconomic subdivision, (f) redevelopment and (g) the landlord's own occupation. If the court's order also rests on any of grounds (a) to (d), no compensation is payable under section 37.
When is the compensation actually paid?
It becomes payable when the tenant quits the holding. If the tenancy is renewed, or the landlord's opposition fails, nothing is due.
Can compensation be contracted out?
Only in limited circumstances. Section 38(2) makes an agreement excluding or reducing compensation void where the tenant and its predecessors in the business have been in occupation for five years or more; below that threshold an exclusion can be effective.
Talk it through with a commercial property surveyor
Check your compensation entitlement with a surveyor
Entitlement turns on rateable value and continuity of occupation. Leave your details and a commercial property surveyor will check the figures with you.
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Indicative analysis only. This is not a valuation, a rating apportionment or legal advice, and it cannot confirm entitlement — that turns on the rateable value of the holding, the continuity of business occupation and the grounds on which the court makes its order. Take advice on your own facts before relying on any figure shown here.