Once a commercial tenant has agreed a lease and moved into business premises, they will rely on having unobstructed access to easily enter the premises for the purposes of their business. Unless premises sit alongside a public road, they will probably have to cross private land for which they will need permission.
‘The access agreement, which might form part of a lease or could be a separate document, will set out the access rights and deal with who maintains roads and how the cost will be split,’ explains Michael Harrigan, a Trainee Solicitor in the Commercial Property team. ‘No business wants to waste time arguing about access or who should be fixing potholes in a road, and good advice from your solicitor could make all the difference’.
He highlights the key points to discuss with your solicitor.
Public highways and private rights of way
The best way to illustrate why commercial property usually needs specific access rights is with an example. Edge-of-town business or retail units are often clustered together on small estates. Tenants and visitors arrive by public highway but once they turn off into the estate, they will usually be on a private road which gives access to the various units, parking, and service areas.
The public highway may be used, free of charge, by all members of the public. In contrast, no one has the right to use the estate road unless it has been expressly granted to them, even if that is the only way for a tenant to get to their business premises.
A single landlord who owns a whole estate will grant access rights for tenants and visitors in the lease of each unit. Alternatively, a large estate might be split with smaller parts owned by different landlords, who then let business units to commercial tenants. The estate road would probably be owned by one of landowners and the others would have to rely on express rights of access granted when the various parts were sold off. Each landlord will then grant access rights to their own tenants. There is a possible trap here – landowners cannot grant rights to their tenants unless they have those rights themselves; so it is important to get this point checked by your solicitor.
The access rights in the documents must match the needs of the landowner and their tenants, and there are number of specific issues to think about.
Do the rights granted cover all parts of the estate road and common areas, or are they limited to specific parts?
Does the agreement allow access for vehicles as well as on foot?
Are there any restrictions on hours of use or on the types of vehicle that can use the road? This can be an issue on mixed-use developments, where the needs of commercial tenants may conflict with the peace and quiet expected by residents.
Cost of maintenance
This is a crucial issue. An adopted public highway will be maintained by the Highways Agency or a local authority, using public money. Roads, paths and other access areas on private land will usually be maintained by whoever owns them, but they will want those with access rights to share the cost.
Access agreements must deal with both aspects, setting out who is required to keep access routes in good repair, as well as who must contribute to the cost. Tenants’ contributions will be covered in the service charge provisions of their lease. In return, they will want their landlord to agree to keep access routes in good repair or, if the roads are owned by a third party, make sure that person carries out necessary repairs.
The way costs are divided between different users may depend on how they use the access routes. For example, a large industrial unit with regular collections and deliveries by heavy goods vehicles would impose more wear and tear on roads than a small office unit where employees arrive by domestic vehicles. The office tenant would expect the industrial tenant to pay a larger share of repair costs.
Interference with access rights
Interference with rights is a fertile area for disputes. A landowner will usually reserve the right to close or restrict access temporarily, either in an emergency or to carry out planned maintenance. A well-drafted agreement will set out when this sort of right will apply and require the landowner to act reasonably, giving notice and causing minimum inconvenience to those who rely on the access rights.
A landowner may also want to be able to make permanent changes, for example if part of the estate is being redeveloped. This can be controversial, and landowners must understand that rights granted cannot be taken away unless the agreement allows for this. In one case, a tenant on a retail park had rights over a large servicing area. The landlord wanted to reduce that area, so that the tenant’s service vehicles would still be able to operate but it would be more difficult for them to manoeuvre. The judge held that the tenant could insist on keeping the generous rights they had negotiated.
Disputes may also arise if an access way is obstructed, for example by new fencing or gates, or by someone parking on the route. The user can take action only if whatever they object to ‘substantially’ interferes with their access. For example, installing a single gate across an access road is probably not a substantial interference, if users can open it easily; but a series of gates along a route might be. This area of law is heavily dependent on the specific situation, so it is important to get legal advice as soon as you can. Delay could make it more difficult to get a satisfactory resolution to a dispute.
Changing use and acquiring extra land
A final note of caution for landowners is that access rights usually apply only to the way they are used when they are first granted unless the agreement allows for changes. If you change the use of your land to one that intensifies your impact on access roads, you may find that the rights granted to you no longer apply. Similarly, if you have rights to use an access route to get to one plot of land, you cannot assume that you can use that route to get to any adjoining land you acquire later.
How we can help
Whether you are settling a new lease or buying an existing investment property, your solicitor can look out for possible problems with access, and make sure you have the rights you need to avoid unexpected costs and disputes.
For further information, please contact Michael Harrigan in the Commercial Property team on 01908 689328 or email email@example.com.