PART 9TERMINATION ETC. OF OCCUPATION CONTRACTS
CHAPTER 7TERMINATION OF FIXED TERM STANDARD CONTRACTS
Landlord’s break clause
198Restrictions on use of landlord’s break clause: security and deposit requirements
1
The landlord may not give notice under a landlord’s break clause at a time when security required by the landlord in a form not permitted by section 43 has not been returned to the person by whom it was given.
2
The landlord may not give notice under a landlord’s break clause at a time when any of subsections (3) to (5) apply unless—
a
a deposit paid in connection with the contract has been returned to the contract-holder (or any person who paid the deposit on his or her behalf) either in full or with such deductions as may have been agreed, or
b
an application to the county court has been made under paragraph 2 of Schedule 5 and has been determined by the county court, withdrawn, or settled by agreement between the parties.
3
A deposit has been paid in connection with the contract but the initial requirements of an authorised deposit scheme have not been complied with.
4
A deposit has been paid in connection with the contract but the landlord has not provided the information required by section 45(2)(b).
5
A deposit paid in connection with the contract is not being held in accordance with an authorised deposit scheme.
6
This section is a fundamental provision which is incorporated as a term of all fixed term standard contracts with a landlord’s break clause; section 20 provides that this section—
a
must be incorporated, and
b
must not be incorporated with modifications.