Q: My commercial tenant abandoned his shop and disappeared when the first coronavirus lockdown hit in March. Using the CRAR procedure I am now considering instructing bailiffs to seize goods from the premises to cover the accrued rent arrears. Due to COVID-19, are there any specific legal issues regarding this?
A: In April 2020, the restrictions placed on the CRAR procedure increased the sum required to 90 days' rent arrears before CRAR could take place, rather than the seven+ days previously.
On 15 September 2020, the Taking Control of Goods (Amendment) (Coronavirus) Regulations 2020 were made, providing further protection to tenants of commercial leases from 29 September 2020 by increasing the minimum unpaid rent before CRAR can take place to: 276 days' rent from 29 September 2020 until 24 December 2020 (inclusive); and 366 days' rent from 25 December 2020. Under those regulations, tenants whose first arrears fell due on the March 2020 quarter date are protected from CRAR until 26 March 2021.
However, currently there are no restrictions or moratorium on the enforcement of judgments under a writ of control at commercial premises. Landlords can therefore consider starting a debt claim in the county court for outstanding rental arrears and any service charges. Once judgment is obtained, this can be transferred to the High Court to obtain a writ of control. Once the 7 days’ notice of enforcement has expired, enforcement by Taking Control of Goods can happen.
With CRAR, enforcement is restricted to attending only the demised premises, but with a writ of control, enforcement agents are permitted to attend any addresses from which the judgment debtor is trading. Following seizure of goods, a valuation of the items and a further 7 days’ notice must be given to the tenant before selling the items. This is however only a basic overview. You should seek expert legal advice before taking any action to recover rent arrears.
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