Property law requires certain information to be given to a party (the tenant or the landlord) by the other. What information this is, and how it is presented might be set out in the legislation under a numbered 'section' of an Act.
Section 40 of the Landlord and Tenanct Act 1954 covers the 'duty of tenants and landlords of business premises to give information to each other'.
What is a Section 40 notice?
A Section 40 notice is a form that can be served by either the landlord or the tenant on the other in order to gather information to be able to make a decision on whether or not to renew or end a business lease.
When can an S40 notice be served?
The notice can be used at any time during the term of the lease, although it is most common to serve one towards the end of the current lease. Certainly, the side serving it will want enough time for the other party to respond so that appropriate decisions can be made prior to the expiry of the lease.
Must I respond to a Section 40 notice?
Both the tenant and the landlord must respond within a month if an S40 notice is served on them. They have a further obligation to tell the other side of any changes of fact in the information given for a further six months. The notice of change of information must be provided within one month of the party becoming aware of it.
If you are the recipient of a Section 40 notice, however, and you have previously transferred your interest in the property and given notice of the transfer and the name and address of the transferee, you will cease to be under any duty imposed by the law.
What information must the notice provide?
An S40 notice served by a landlord on a tenant seeking information will require the tenant to state whether there has been a contracting out of any sub-letting and whether a Section 25 notice or a Section 26 notice has been served.
An S40 notice served by the tenant on the landlord will require the landlord to state: whether there is a superior lease, and whether a Section 25 or Section 26 notice has been served.
Further information and template documents
If you want to serve an S40 notice, we provide both a S40 notice for the tenant and a S40 notice for the landlord.
Next, you may want to read about how to end a business lease, or The Regulatory Reform (Business Tenancies) Order 2003 - the law that gives tenants security of tenure.