- Commercial Rent (Coronavirus) Act: landlords' forfeit reinstated
Commercial Rent (Coronavirus) Act: landlords’ forfeit reinstated
Commercial Rent (Coronavirus) Act: landlords’ forfeit reinstated28th April 2022 - Published by Kuits Property Team
Does the Act cover all tenancies?
The Act applies to commercial tenancies only i.e. tenancies under, or contracted out of, Part 2 of the Landlord and Tenant Act 1954.
What is the “protected period”?
The protected period covers the period of time that businesses were forced to close, or partly close, due to rules imposed as a result of the various lockdowns that the UK was subject to.
For non-essential retail premises, like clothes shops, the protected period is from 21 March 2020 to 12 April 2021. For licenced and leisure premises, the protected period is from 21 March 2020 to 18 July 2021.
When can a landlord forfeit a lease?
The moratorium was lifted at 12:01am on 26 March 2022. A landlord can take the necessary steps to forfeit the lease from this date, such as re-entry or possession proceedings, provided that the tenant has rent arrears that were accrued outside of the protected period.
If a tenant has rent arrears that were accrued during the protected period, the parties will need to begin arbitration proceedings. Further information about the arbitration process can be found here.
Can a landlord inadvertently waive their right to forfeit the lease for unpaid rent?
Yes. It is important that landlords do not do anything that treats the lease as though it is ongoing, such as issue rent demands, even on a without prejudice basis.
How does the Act impact tenants?
To avoid forfeiture, tenants should ensure that they pay any rent arrears that relate to a period that is not protected as soon as possible.