Commercial lease transparency: top tips for landlords and tenants

September 2, 2025

Commercial lease transparency: top tips for landlords and tenants

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By Oliver Morris

Read time: 3 minutes

Welcome news for tenants in the recent High Court decision of London Trocadero (2015) LLP v Picturehouse Cinemas Ltd and others.

The High Court confirmed that landlords cannot pass on their own insurance commission costs to tenants, under standard lease terms. Our commercial property expert Oliver outlines the case and top tips for landlords and tenants.

The case

The case involved a wider dispute relating to a claim from Trocadero (The Landlord) against Picturehouse and others (the Tenant), for the recovery of unpaid rent arrears, including annual rent and insurance rent. One of the key issues involved whether the tenant’s liability to pay the insurance premium, included an obligation to pay the landlord commission.

What did the Court decide?

It was held that:

• on a proper construction of the lease terms, landlord commissions were not bona fide “premiums payable… for keeping [the] Centre insured”, and so were not recoverable from the tenant;
• the commission did not represent compensation for any services provided by the landlord; and
• the tenant was able to recover sums previously paid by way of commission (circa £700,000), on the basis that the landlord had been unjustly enriched.

What this means in practice

This case is a reminder for tenants to avoid automatically accepting all costs passed on in service charge or insurance bills. If the lease does not clearly state you must pay commissions, you may be able to challenge them.

For landlords, it highlights the importance of transparency and properly drafting lease terms to avoid disputes or not being able to recover costs.

Top tips for landlords / tenants

For landlords:

• Review lease terms: Ensure any relevant fees or commissions are expressly stated.
• Improve transparency: Fully disclose any commission sources and amounts to tenants.
• Check/Re-visit current arrangements: Limit broker commissions to genuine market-level amounts, and ensure these payments are proportionate to the work being carried out in respect of the insurance/arranging the policy.
• Seek legal advice: Consider tightening relevant terms for new leases, and prepare for potential claims from current tenants.

For tenants:

• Review lease terms: Consider how insurance costs are defined, and whether insurance commissions are included.
• Formally request a breakdown of insurance charges: Ask the landlord for full disclosure on insurance fees and commissions (this can be back-dated up to 6 years).
• Assess exposure: Gather evidence – i.e. the lease itself, any broker agreements, policies, etc.
• Seek legal advice: Consult with an expert to explore possible claims.

If you’re looking for advice on how to navigate insurance commission payments, please contact a member of our expert Commercial Property team for a free initial chat, to see how we can help you using the contact form or on 02920 829 100.