Repossession & Forfeiture
Repossession and forfeiture is a remedy that landlords can use to regain possession of their commercial property if a tenant has breached a lease covenant.
Given its draconian nature, it is crucial for both tenants and landlords to seek legal advice if the right to forfeiture has been exercised or is being considered.
We are a diverse, multi-lingual law firm that employs best-in-class technology to provide clients with streamlined, modern, and highly effective commercial property law advice and representation. Our extensive experience in commercial property law has established our reputation for excellence with the UK’s top Barristers and King’s Counsel, Estate Agents, Independent Financial Advisers, Surveyors, and Lenders, who can offer additional support to our Commercial Property Department when needed.
What Is Forfeiture?
Forfeiture is an ancient legal remedy that allows a landlord to terminate a lease and re-enter the property if:
- A covenant in the lease agreement has been breached by the tenant, or
- A triggering event specified in the lease has occurred, such as tenant insolvency.
The right to forfeiture can be exercised even if the lease agreement does not explicitly mention it. However, landlords must be extremely cautious. To legally exercise forfeiture, the tenant’s breach of covenant must affect the essence of the contract. The most common reason for forfeiture is non-payment of rent.
How Can a Landlord Legally Re-Enter the Property?
A landlord can re-enter a commercial property by:
- Peaceable re-entry
- Issuing court proceedings
Peaceable Re-Entry
Peaceable re-entry occurs when a landlord re-enters their commercial property (when the tenant is absent) and bars the tenant from entering (typically by changing the locks). This forces the tenant to apply to the Court for relief from forfeiture. Peaceable re-entry can only be used for non-payment of rent.
Re-entry must never be attempted when someone is present in the property, or if the tenant lives above the shop. Additionally, peaceable means exactly that; any use or threat of force can result in criminal prosecution.
Landlords must also comply with the Commercial Rent Arrears Recovery (CRAR) provisions when dealing with stock and possessions left behind.
Issuing Court Proceedings
Issuing court proceedings, while more expensive and time-consuming than peaceable re-entry, carries significantly less risk. Our commercial property team generally advises this approach.
What Constitutes a Waiver of the Right to Forfeiture?
If a landlord requests or accepts rent from their tenant, they waive their right to forfeiture. Any other conduct that the Court interprets as affirming the lease, such as making repairs requested by the tenant, may also be seen as waiving the right to forfeiture.
What Should a Tenant Do If Served with Court Proceedings for Repossession?
Upon becoming aware of forfeiture proceedings, a tenant can apply to the Court for relief from forfeiture. The Court has the discretion to grant or withhold relief. Factors that favour granting relief include the prompt payment of owed rent, rectifying other breaches of covenant, and offering to cover the landlord’s legal costs.
Why Choose Us?
The circumstances leading up to forfeiture can be stressful and overwhelming for all parties. However, with the right professional advice, the process does not have to be daunting. Our Commercial Property Solicitors will meticulously examine the commercial lease and provide advice and representation for landlords seeking to exercise forfeiture or tenants seeking relief from the Court.
We pride ourselves on offering personal service to all our clients, remaining available by phone and responding to emails within 24 hours whenever possible. As a full-service law firm, we also offer advice on other commercial matters such as contracts and dispute resolution.
We leave no stone unturned in handling your commercial property matters. Each member of our team has the experience and resources to ensure every aspect of the forfeiture and repossession process is addressed and managed. Clients trust us to provide commercially astute advice that fully protects their interests.
Our Solicitors are businesspeople themselves; therefore, we understand that every decision must reflect commercial reality. Most of our instructions come through word-of-mouth recommendations because business owners, landlords, and management agencies in the West Midlands know we have the knowledge and dedication to advise on the complex process of forfeiture.
We are focused on achieving results swiftly and cost-effectively. Our Commercial Property Solicitors will handle your legal concerns so you can focus on your organisation’s future growth and success.
To discuss matters concerning repossession and forfeiture, please contact us using the form below.
Cocks Lloyd Solicitors provides exceptional Repossession & Forfeiture and Commercial Property services to clients. People choose and recommend us not just in Nuneaton, Tamworth, Atherstone, Hinckley and Leicester, but across Warwickshire, Staffordshire, Leicestershire and the West Midlands, and the whole of the UK, because we get results.
To receive expert advice and representation regarding Repossession & Forfeiture and Commercial Property, please contact us using the form below, call us on (0247) 6641642, email via the Request a Callback form on this contact page.