Due to the coronavirus pandemic and the huge impact it is having on both commercial landlords and tenants we are extending our monthly commercial property legal clinic and are offering free daily telephone appointment slots for the foreseeable future. Commercial Property solicitor Osman Dervish will try and answer any questions you have regarding your legal position during this current crisis. If you need advice please book your appointment via Calendly.
In this rapidly changing environment Osman may not have all the answers so we are posting alerts on this blog page when there is an update or point of clarification on a government decision relating to this sector. If you wish to receive an email when a new alert is published please subscribe to the email alert service using the form at the bottom of this page.
Update: 21 APR 2020: A Loophole in the Protection for Commercial Property Tenants
There is a loophole in the coronarvirus related protection offered to commercial property tenants which is being exploited by some unscrupulous commercial landlords.
Section 82 of the government’s Coronavirus Act 2020 came into force on 25 March to help protect commercial tenants.
It banned the forfeiture of commercial leases until 30 June 2020.
However, the Act does not prevent landlords from taking certain actions, including Commercial Rent Arrears Recovery (CRAR), making a debt claim, issuing a statutory demand, or commencing winding-up proceedings.
This is not in the spirit of the new guidance and legislation but until the government moves to stop all enforcement action, we may see more of this
If you are a commercial property tenant unable to keep up with rent payments and your landlord is threatening legal action please book into one of our free commercial property clinic and we can discuss your options.
30 March 2020: Covid-19, Commercial Leases and Suspension of Rent
There are generally no clauses in commercial leases that allow for suspension of rent in these kind of circumstances, simply because this is just so unprecedented.
It is therefore between the landlord and tenant to reach a compromise but failing that, rent is still due and owing under the terms of the lease. The government however announced on 23 March 2020 that commercial tenants who cannot pay rent because of COVID-19 will be protected from eviction. The Coronavirus Bill is currently going through parliament, which will mean no business can be forced out of their premises until at least 30 June 2020, even if you miss payments of rent. This date may also be extended to six months depending on how things develop with the virus.
What however is unclear at this moment in time is whether the tenant will have to pay back the missed rent payments at a later date but government advice will no doubt be updated and clarified in the coming weeks and months. You can also find useful government advice on this area at the following link: Extra protection for businesses with ban on evictions for commercial tenants who miss rent payments
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