Commercial Landlords have legal recourse despite eviction ban extension

Property litigation firm Cavendish Legal Group has slammed the government for “causing further uncertainty” among commercial property landlords, by extending the ban on evictions of firms behind on rent.

The ban which prevents landlords taking tenants to court for non-payment, was due to end on June 30, but has now been extended for a further nine months.

Jonathan Frankel, litigation partner at Cavendish Legal Group, said the extension poses a real financial challenge for landlords with tenants already in arrears. But also, brokers should be making their clients aware of legal avenues open to them.

He said: “There’s no doubt that sectors such as hospitality and retail have been hardest hit by the economic impact of coronavirus, with some estimates suggesting they are carrying around £5bn in rent debt.

“However, to make this announcement now, shortly after the eviction ban on residential tenants was lifted, only serves to generate more uncertainty among landlords, many of whom will feel they have another mountain to climb financially to get through this period.

“It also raises questions about what else the government may decide to extend further, such as the SDLT deadline, or the furlough scheme for instance. What it really does demonstrate is that it is going to take a significant number of years for the impact of coronavirus and its economic legacy to play out.”

Frankel says that it is more important than ever to engage with tenants and for brokers to make their clients aware that there are legal options to try to mitigate the financial impact in the coming months.

He said: “Commercial property landlords are going to be facing more difficult months ahead and while they will of course have to abide by the government’s ruling, it is still important to get the right legal advice.

“If a landlord is looking at months of arears from their tenant, it’s vital to work with them to try to reach an agreement, through mediation, and work towards an amicable resolution. This is where legal advice and solicitors will play a key role in facilitating that process.

“Due to the unprecedented times that we’re in, both sides of the dispute are going to be feeling aggrieved. Tenants will feel it’s through no fault of their own that their business has been closed for large parts of the last 18 months, but quite simply landlords rely on the rent for their own income and financial stability.

“So, making sure you clients get the right advice now will help to manage the issue nine months from now when the ban on evictions finally lifts.”



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