CRAR update

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CRAR update

18 Feb 2014

This Bulletin should be read in conjunction with the website article Time is ticking.

The previous Bulletin identifies the new regime of commercial rent arrears recovery (CRAR) which comes into force on 6 April 2014.

We now have some more information which addresses the costs enforcement agents (these were formerly known as certificated bailiffs for the purposes of distraint) can charge at various stages of the process.

In summary these are as follows:-

  1. Compliance stage:- this is where the landlord would instruct the enforcement agent and the agent serves the initial notices.  The enforcement agent can charge a fixed fee of £75 for doing this.
  2. Enforcement stage:- this deals with all of the steps the enforcement agent can take in relation to enforcement but not relating to the sale or subsequent disposal of the goods.
  • If the enforcement relates to non High Court matters the enforcement agent is restricted to a fixed fee of £235plus 7.5% of any sum to be recovered which exceed £1,500.
  • If it is a High Court matter they can charge a fixed fee of £190 plus 7.5% of any sum to be recovered exceeding £1,000.
  1. Finally at the sale or disposal stage the enforcement agent is entitled to a fixed fee of £525 plus a further 7.5% of any sum to be recovered in excess of £1,500 for non High Court matters and £1,000 for High Court matters.

The fees referred to above will usually be recoverable out of the proceeds of sale of the seized goods along with expenses such as paying for locksmiths, court fees and storage costs.

Conclusion

We reiterate the point made in the previous Bulletin.  If you have outstanding rent (as defined in your lease) you really ought to think about using the old system of distraint before 6 April 2014 because after that landlords will have to use CRAR and distraint will no longer exist.

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