Rent arrears - Landlord's remedies

1. Court Action for Arrears of Rent and Other Sums Due

Before taking court proceedings a “letter before action” is usually served which is a demand for payment of the arrears within a specified period stating that failure to do so will result in Court proceedings for all sums due plus interest and costs.

Court proceedings are costly and may not be productive especially if the tenant were to enter into insolvency during the course of the proceedings, which would reduce the chance of obtaining payment in full.

2. Statutory Demand

If there can be no dispute as to the amount of money owed and it is in excess of £750, then a statutory demand requiring payment of all outstanding sums within 21 days, can be served on the tenant.

If such demand is served correctly and payment is not tendered within 21 days then a petition for the compulsory winding up of the company tenant/bankruptcy of the individual tenant can be presented.

This method should only be used if there is no possible dispute as to liability.

Whilst the delivery of a statutory demand can jolt a tenant into action, it can also force an otherwise solvent tenant into insolvency, thereby reducing the chance of obtaining payment in full for arrears of rent.

3. Forfeiture

Most leases provide for Landlords to forfeit the lease if the tenant is 14/21 (or such other period as may be provided) days late in paying the rent, even if it has not been formally demanded. Whilst forfeiture can be useful against a defaulting tenant, it will only be useful if the tenant actually wishes to retain its leasehold interest in the property.

This cannot be used if there is anyone living in any part of the property

Landlords should remember that this step could result in an empty property and no rental income until a new tenant is found.

Forfeiture can be obtained by:

a. Peaceable re-entry on to the property or

b. Obtaining an order of the court.

a. Forfeiture by Peaceable Re-Entry

Landlord's are not required to obtain a Court Order for forfeiture by peaceable re-entry and when the right of forfeiture is being exercised for failure to pay rent, n o prior notice is required to be given to the tenant.

Peaceable re-entry is where, without using excessive force, a Landlord enters on to the property and, usually changes the locks, barring access to the property of the tenant.

Whilst this is a relatively cheap and quick option it does have a downside. A tenant can make an application to the court within six months of the date that a Landlord re-enters the property for relief.

Landlord's taking this step will have an uncertain period of six months during which it may be difficult to re-let the property as there is the potential that the court could provide relief to the tenant thereby requiring re-occupation of the property, by the old tenant.

b. Forfeiture by Order of the Court

Landlords make an application to the Court for an order to re-enter the property which is then enforced as set out above.

It should borne in mind that even with a Court Order the Tenant can seek relief although the timescale within which to do so will be set by the Court.

4. Distress

This is a speedy and usually effective method to recover sums due, by entering onto the property and seizing movable goods to the value of the outstanding rent and towards the costs of the action.

Obviously this will only be as good as the sale value of the goods on the property belonging to the tenant.

A certificated bailiff must be employed to effect this action.

Contact Charlotte Parry-Jones on 020 8300 9321 or cparry-jones@wmk-law.com alternatively Contact Us

Infertile men allowed to claim compensation for destroyed semen samples

In the case of Yearworth and Others v North Bristol NHS Trust [2009] EWCA Civ 37 the Court of Appeal ruled that male cancer patients could claim compensation against the hospital trust who had allowed their frozen semen samples to thaw through the hospital's failings.

Chemotherapy had damaged the men's fertility. Unfortunately the hospital had accidentally thawed the samples in 2003.

The men are allowed to claim damages for psychiatric injury and/or mental distress in bailment.

Contact Isabel Elliott on 020 8300 9321 or ielliott@wmk-law.com alternatively Contact Us