Tenant protections extended again
The government was extending to 31 March 2021 the various tenant protections it has brought in since the pandemic began. However, that announcement of course pre-dated the current lockdown and it will come as a surprise to no-one that, despite this, the protections have been extended again until 30 June 2021.
Please note: the information contained in this legal update is correct as of the original date of publication.
We mentioned in our article on 14 December (click here) that the government was extending to 31 March 2021 the various tenant protections it has brought in since the pandemic began. Back in December, the government indicated that this would be the final extension. However, that announcement of course pre-dated the current lockdown and it will come as a surprise to no-one that, despite this, the protections have been extended again until 30 June 2021.
So, in summary, until 30 June 2021:
- A landlord cannot forfeit (i.e. terminate) a business lease for non-payment of rent (and other sums due under a lease).
- A landlord cannot exercise the statutory procedure known as Commercial Rent Arrears Recovery (or CRAR) (which allows a landlord to instruct an enforcement agent to take control of a tenant's goods and sell them to recover an equivalent value to the rent arrears outstanding) unless a minimum of 457 days’ net unpaid rent is outstanding (where CRAR takes place between 25 March 2021 and 23 June 2021) or 554 days’ net unpaid rent is outstanding (where CRAR takes place between 24 June 2021 and 30 June 2021). In effect, this prevents a landlord exercising CRAR even if a tenant has paid no rent since the March 2020 quarter day.
We haven’t yet heard if the restrictions on serving statutory demands and presenting winding-up petitions against tenants (and indeed all companies) which were originally brought in last summer have been similarly extended (although we’d have thought such an extension likely).
The government has also announced that it is launching a call for evidence to help monitor the overall progress of negotiations between landlords and tenants for paying or writing off outstanding rents (something the government has encouraged through its voluntary code of practice which it published last June – click here). This call for evidence will also set out the potential steps the government could take after 30 June. This could range from a phased withdrawal of current protections to legislative options targeted at those businesses most affected by the pandemic.
In December, the government also announced a review of what it described as ‘outdated’ commercial landlord and tenant legislation. This review will consider a broad range of issues including Part II of the Landlord & Tenant Act 1954, different models of rent payment and the impact of the pandemic on the market. The review was originally going to take place early in 2021. However, the government now states that it will be launched ‘later this year’.
These are difficult times for everyone and whilst it is welcome news that the moratorium has been extended, it doesn’t mean any of the problems have gone away. It’s merely a putting off of the inevitable. Whilst some landlords and tenants have been able to reach mutually acceptable arrangements, this isn’t the typical position and the uncertainty is helping nobody – landlords and tenants alike. We need urgent solutions now – not a kicking of the can down the road!
You may be interested in...
Browne Jacobson advise Maven Equity Finance on investment in Traverse Associates
Three strong restructuring and insolvency team join Browne Jacobson
The real estate podcast: How AI and tech is changing real estate
How to negotiate better ‘green’ provisions in your leases
The Metaverse's influence on real estate: Implications for commercial retail clients and law firms
How to manage retail sector supply contracts and avoid disputes
Utilising prime retail sites to improve the health of our nation
A new era of opportunity for high street regeneration?
Practical points from High Court ruling that Tesco has infringed Lidl’s IP rights in its famous yellow circle logo
Pitfalls for retailers to avoid when offering access to ‘buy now, pay later’ products
Browne Jacobson’s Manchester dealmakers advise Spatial Global on its acquisition of Heathrow based freight specialist Hollyport Logistics
Supreme court rules on retail tenant's service charge bill
Consumer duty part 3 - 'The drill-down' into the 'cross-cutting' rules
The UK's green agenda - the outcomes of COP27 and actions since COP26
Browne Jacobson’s retail lawyers advise Wilko on its strategic £48m sale and leaseback of Nottinghamshire distribution centre to DHL
Suzanne Harlow joins Browne Jacobson as Non-Executive Director
Law firm Browne Jacobson is pleased to announce that Suzanne Harlow has been appointed Non-Executive Director of its Retail, Consumer & Logistics sector.
Is this the end for free returns?
Earlier in the year a number of fashion retailers, boldly announced the introduction of a charging fee for returning any product purchased via their online store. Yet, despite this commercial, and perhaps somewhat controversial decision, at least one major fashion giant that adopted this approach has recorded ‘historic highs’ in its September profits. Browne Jacobson partner, Cat Driscoll who heads up the firm’s commercial team in Manchester and is also head of its Fashion & Beauty sector discusses whether this change has put the average consumer off and whether the days of free returns are long gone.
AI generated designs on retail products
Consumer duty part 2 - 'The drill-down' into the 'cross-cutting' rules
Luxury brands and sustainability – The challenges and solutions
The Retained EU Law
Created at the end of the Brexit transition period, Retained EU Law is a category of domestic law that consists of EU-derived legislation retained in our domestic legal framework by the European Union (Withdrawal) Act 2018. This was never intended to be a permanent arrangement as parliament promised to deal with retained EU law through the Retained EU Law (Revocation and Reform) Bill (the “Bill”).
Rent arrears post-Covid: What are the landlord’s options?
Since the beginning of the pandemic, landlords and tenants have experienced significant limitations in the way rent arrears could be pursued. We first saw the moratorium on the recovery of Covid related arrears, and more recently we’ve experienced the implementation of the Covid arrears arbitration scheme.
Consumer duty part 1 - 'The drill-down' into the 'cross-cutting' rules
This article is the first in a series aimed to help firms get to grips on a practical basis with the ‘cross-cutting rules’ within the new ‘Consumer Duty’ framework.
Browne Jacobson appoints its first Non-Executive to Chair to support its corporate sector strategy board
Press Release - Firm news
Browne Jacobson strengthens its UK&I commercial practice with hire of new retail & consumer specialist partner
Browne Jacobson has bolstered its commercial practice in the UK with the appointment of commercial contracts and international trade specialist, Emma Roake, into its City-based London team.
Cameras in convenience stores: a potential hornet’s nest..?
Sole director decisions: Another perspective
Merger and Acquisition trends in the specialist lending market
RAAC planks and its impact on local authorities
Recent reports of flat roofs constructed using RAAC planks collapsing without warning prompted the SCOSS alert.
Court of Appeal overturns “fire and re-hire” injunction
The Court of Appeal overturned the “fire and re-hire” injunction, finding that there was nothing in the express contractual provisions preventing Tesco from giving the notice to terminate employment in the usual way.
The Omnibus Directive is almost here
Opinion - Building Safety Act
Building Safety Bill amendments
W (No.3) GP (Nominee A ) Ltd and another v J D Sports Fashion Plc (Nottingham County Court, 22 October 2021)
The County Court refuses the landlord’s request to include a turnover rent in a statutory lease renewal.
Employment Tribunals 2022-23 – What to Expect
The Presidents of the Employment Tribunals England and Wales and Scotland have issued a new road map for 2022-23, providing an update on the resourcing challenges faced by employment tribunals and the steps put in place to address these.
Government’s proposals for dealing with pandemic rent arrears finally reach the statute book
The Commercial Rent (Coronavirus) Act 2022 was finally passed yesterday (24 March) and comes into force immediately.
Browne Jacobson broadens its construction offering with appointment of nuclear and renewable energy specialist
Browne Jacobson has broadened its national construction and engineering offering with the appointment of construction partner Zoe Stollard into its Birmingham office.
Covid-19 rent arrears – the questions that remain
The Government appears set to announce plans on ‘living with Covid to restore freedom’. With the success of the retail and hospitality sector key to recovery, what protections will be on offer to tenants to deal with Covid-19 rent arrears?
Are whistleblowers entitled to keep their employer’s confidential documents?
In Nissan v Passi, the High Court recently considered the issue of an employee retaining confidential documents belonging to his former employer in the context of the employer’s application for an injunction seeking the return of such documents from the employee.
Levelling up white paper strategic briefing
The levelling up white paper sets out a set of 12 priority ‘missions’ to be pursued by national and local government in the years to come. With measures covering regeneration, communities, connectivity, education, R&D, employment, and health.
High Court injunction granted to prevent “fire and rehire”
The High Court has granted an injunction against Tesco preventing the dismissal and re-engagement (‘fire and rehire’) of employees in an attempt to remove a contractual entitlement to enhanced payment terms.