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Restrictions finally eased for commercial landlords

5th October 2021

Restrictions finally eased for commercial landlords

Nyree Applegarth, a Partner in the Higgs LLP Dispute Resolution and Litigation team, looks at changes in the rules for commercial landlords as emergency coronavirus legislation continues to be eased

Commercial landlords have been hamstrung throughout the pandemic by Government legislation around statutory demands and winding up petitions.

From very early on in the pandemic, the Government stepped in and placed a hold on landlords exercising some of the remedies that were open to them if tenants were not paying rent.

The temporary measures became more permanent but, finally, there appears to be some lifting of the restrictions. 

On September 9, the Government announced that the restrictions on serving statutory demands and presenting winding up petitions in place until September 30 2021 were not going to be extended but and were to be replaced with more limited restrictions for winding up petitions that are presented between October 1 2021 and March 31 2022.

New conditions now have to be met for presenting the winding up petition.  Principally, these are:

A creditor may not present a winding up petition in respect of commercial rent that is unpaid because of the financial effect of coronavirus;

A creditor may not present a winding up petition if it is for a debt or debts totalling less than £10,000;

A creditor cannot present a winding up petition unless written notice has been delivered to the debtor seeking the Company’s proposals for payment of the debt and the Company has not made a satisfactory proposal; and

A creditor will, again, be able to rely on non-payment of a statutory demand to evidence a debt at an ability to pay;

The Government’s aim is to protect businesses from being wound up in respect of liabilities other than commercial rent until March 31 2022.  Clearly, the Government is hoping that parties will work together to try and reach satisfactory proposals for repayment of a debt.

This, however, is often easy said than done. Contact me on nyree.applegarth@higgsllp.co.uk or 01384 327151 for expert dispute resolution guidance.

 

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