Commercial property services

We can advise on a range of issues from how to recover arrears of rent and service charges to how a landlord can regain possession in the quickest and most cost effective manner. At the end of the lease we can advise on both the substantive and tactical issues of any claims for disrepair.

In the area of business tenancies we can advise landlords on how they can recover possession of their properties, but we also advise tenants on how to protect their rights and secure compensation if evicted.

In general we provide expertise and advice on the following:

Lease renewals

Disputes can often arise when business tenancies protected by the Landlord and Tenant Act 1954 come up for renewal. The Act essentially provides that tenants have the right to seek a new tenancy and landlords only have limited grounds on which they can oppose a new tenancy. We have experience of advising both landlords and business tenants when disputes arise.

Tenants - The simplest disputes centre on the rent to be paid under the new lease, the term of the lease and any break provisions. These issues are usually dealt with by surveyors acting for both parties, but the process takes time. During this period various deadlines come up which must be extended to protect the tenant’s rights. As the risk lies solely with the tenant we frequently work alongside property solicitors in other firms who are handling the non- contentious aspects of the lease renewal, to ensure that these deadlines are extended when necessary.

Landlords - There are some specific grounds on which a landlord can oppose an application for a new lease. These grounds require careful planning and the preparation of detailed evidence to ensure that landlords can regain possession of their property. We have successfully advised landlords on such cases.

There are many other aspects to business lease renewals, for example claiming compensation and opposing renewal where the tenant has not complied with the terms of his existing lease.

Whether you are a landlord or a tenant and whatever the circumstances of your case we have the expertise to assist you.

Dilapidations

As a landlord, you expect your commercial tenants to look after your premises and keep up to date with repairs and general maintenance. After all it’s in the lease agreement that they signed. So what can you do when you see that your property is falling into disrepair? How can you legally force the tenant to do something about it?

During the term of the lease there are a number of options which can be employed to force the tenant into carrying out the necessary repairs. Each has its advantages and disadvantages. We can advise on the best option for you.

At the end of the lease the dilapidation claim becomes an action for the cost of the repairs. The process involves the drafting of a Schedule of Dilapidations with the assistance of a specialist building surveyor. Thereafter both parties should follow a detailed protocol to try and resolve the dispute.

As with any litigation, tactics and strategy are involved. Both parties will be looking at the detailed terms of the lease – the landlord to maximise the claim, the tenant to minimise it. In addition there is always the diminution hurdle to consider – for example, do the cost of the repairs exceed the diminution in value of the landlord’s freehold interest?

We can help ensure you understand all the options and employ the appropriate tactics to get the best outcome for you.   

Possession actions

As a landlord, you may need to regain possession of your commercial property during the fixed term of a lease. What are your legal options?

The basic process of evicting a licensee or tenant involves serving a notice to quit and thereafter issuing court proceedings based on a breach of a term in the licence or tenancy.

Please note: occupants of a commercial property can either be a licensee or a tenant.

This means the basic process outlined above varies according to whether there is a licence or a tenancy and, most importantly, the breach on which the landlord is seeking to bring the licence or tenancy to an end. The breach could simply be arrears of rent, but a landlord could also be concerned with other breaches – failure to repair, unlawful assignment or sub-letting or nuisance.

Considerable care must also be taken to avoid the problems associated with the law of forfeiture. Forfeiture is the technical term for seeking possession. However, if the landlord, after becoming aware of the breach on which he is seeking to bring the lease to an end, takes any step which recognises the continued existence of the lease, the landlord “waives the breach” and with it his right to bring the lease to an end for that breach.

Our expertise in commercial property law means we can guide you through the process and avoid any costly mistakes.

Rent arrears

There can be many reasons why your tenant gets behind in their rent: poor cashflow; bad business management; debt prioritisation; even wilful default.

We can help you decide on the right rent recovery option. There are five main options:

  • Commercial Rent Arrears Recovery: a legal process under which an enforcement agent can seize a tenant’s goods in settlement of the arrears. This is an inexpensive option but there are limitations. We can advise on trusted and quality enforcement agents.
  • If you have a sub-tenant, another option is to serve a notice on that sub-tenant requiring them to pay their rent directly to the landlord. You need to be very careful with this option if the sub tenant is not one you have previously given consent for.
  • Issue either court or insolvency proceedings against the tenant. The choice will depend on a number of factors including the circumstances of the tenant, the size of the debt, whether there is a cost recovery clause in the lease and how any potential judgment could be enforced.
  • Issue proceedings against a third party such as a previous tenant or any guarantor. Pursuing any such claim requires the service of a particular notice and strict time limits apply on the service of these notices.

Each case is different and we can advise you on the best route to take in your particular circumstances.

Enforcement of judgments

You have won your case and obtained a judgment for arrears from the court. The assumption by the court is that the debtor will obey the order and pay. Sadly, this is not always the case. How do you obtain payment if the debtor refuses to pay?

We have successfully enforced many judgments and there are six broad options:

  • Enforcement agents: an enforcement agent attends at the debtor’s house or premises and can in broad terms seize the debtor’s goods. These goods are then sold at auction to settle the judgment.
  • Oral examination: the debtor is forced to attend court and give evidence on oath as to his income and assets.
  • Attachment of earnings: a sum is deducted from the debtor’s salary each month in part settlement of the judgment.
  • Third party debt order: the court freezes the debtor’s bank account and any monies in that account are then applied in settlement of the judgment.
  • Charging order: the court orders that a charge is placed over the debtor’s house to secure the judgment. If this does not secure payment, then a further application seeking an order for sale of the house may be necessary to enforce the charging order.
  • Insolvency; this is the ultimate method of enforcement. If the debtor does not pay the judgment you can apply to the court to have the debtor declared insolvent.

There are advantages and disadvantages of each method but the most appropriate method (or methods, as you can use multiple methods at the same time) depends on the individual circumstances of each debtor. For example, is the debtor in employment; does he own any property; do you know the details of the debtor’s bank accounts; will the threat of insolvency force the debtor to pay?

We can advise you on the most appropriate methods for your particular case.

Breach of Lease Covenants

Whilst the most common breach of covenant is a failure to pay rent, tenants do also breach other covenants in their leases – for example, the tenant may cause a nuisance, he may use the property in a prohibited manner or he may assign or sub-let his lease without the landlord’s consent.

The response of the landlord must first be to assess the extent and severity of the breach as the landlord essentially has two options – either to recognise the lease as continuing and force the tenant to comply with the covenant in question or to treat the breach as so serious that the landlord then seeks to forfeit the lease. If the latter option is pursued, timing and the landlord’s actions following the breach are critical if the problems regarding waiver are to be avoided.

Whether you are a landlord or tenant, we can assist you in pursuing or defending any breach of covenant issues.

Contested Break Notices

Many leases contain a provision entitling either the tenant (or sometimes the landlord) to terminate the lease at some point during the term. These provisions are called break clauses and they usually provide that a certain amount of notice must be given some months before the break date.  Some break clauses go further and require compliance with the lease covenants as an additional condition to terminate the lease. These provisions sound deceptively simple but in reality they must be complied with strictly.

Disputes often arise on the technicalities of the break notice – has it been worded correctly, was it sent to the right people and by the correct method specified in the lease? Have any other pre-conditions been met? The reason for the disputes is that the stakes are high – the tenant wants to leave the premises and his obligations under the lease behind but the landlord wants to secure his rental income and so he wishes to keep the tenant “on the hook” if he can.

We have acted for both landlords and tenants in these situations and therefore have the experience to assist either side in achieving their goals.