Rent default: minimising the risk and making effective use of the remedies available

Abstract

When tenants of commercial property default with their rental payments it is often a symptom of a poor landlord and tenant relationship. This can be due to a failure to communicate and seek solutions for financial distress in advance of the point of crisis. This paper examines the number of remedies available to the property owner and the careful thought that should be given to which is most appropriate before embarking on a course of action. The key issues tend to be cost and potential outcome. The Human Rights Act 1998 has introduced doubt over whether the two most popular remedies used to combat rent default are still legally enforceable.

When tenants of commercial property fail to make rental payments in accordance with the provisions of their leases, the astute landlord or managing agent should be well prepared for the eventuality and should have already explored the options available. Experience suggests that for a landlord and tenant relationship to be successful there needs to be a mutual respect and understanding of the parameters each party is operating within. For this to occur, an ongoing dialogue throughout the relationship is required. Copyright © 2001 Henry Stewart Publications