Suspension on enforcement action against Commercial Tenants extended

In a recent article, I provided on update on the suspension of evictions in relation to residential properties, highlighting that a freeze on repossession actions had been extended until 24 August 2020.

It was, at that time, unclear as to whether the current freeze on enforcement action against commercial tenants would be extended beyond the end of June 2020. The Government last week provided some clarity in that regard, publishing a Press Release within which they announced that:-

  • The freeze on evictions insofar as they related to commercial properties would be extended until 30 September 2020;
  • Further legislation is to be introduced which will prevent Landlords from using Commercial Rent Arrears Recovery (“CRAR”) unless 189 days of unpaid rent is owed. The Taking Control of Goods and Certification of Enforcement Agents (Amendment) (Coronavirus) Regulations 2020 (the “Regulations”), which were introduced on 25 April 2020, amended the pre-Covid rules so that CRAR could only be used where at least 90 days rent was unpaid rather that the usual pre-Covid 7 days outstanding rent. This change will remain in force until 30 September 2020).

These measures, coupled with the temporary ban on the issue of statutory demands and winding up petitions until the end of September 2020, will prevent Landlords from taking enforcement action to recover unpaid rent.

In addition, the Government has published a short Code of Practice which is intended to encourage commercial Landlords and Tenants to work together to get through the Coronavirus crisis. The Code is voluntary, and its existence has not been widely published at this time. The sceptic in me therefore wonders just how many Landlords and Tenants will even become aware of it, never mind seek to put it into effect.

We will provide further updates on any significant developments as and when they arise.  In the meantime, if you have any queries arising from this article, or would like to suggest a topic for a future article, please contact Chris Drinkall on 01482 337367 or by email at christopher.drinkall@rollits.com.  Chris can also be followed on twitter at @drinkall_chris and on LinkedIn.   

Posted on: 24/06/2020

This article is for general guidance only. It provides useful information in a concise form. Action should not be taken without obtaining specific legal advice.

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