How to repossess commercial property from tenants who won't leave

Property Repossession

As a landlord, repossession of commercial property is your right. When a tenant is in arrears or has breached the terms of their lease, you may seek a Warrant to Forfeit in order to cancel the lease and evict them or use ‘peaceable re-entry’ to enter the property and change the locks if the premises are empty. However, in both cases the tenant can resist and challenge your decision, so you need to make sure everything is done by the book.

Common tactics

Because your right to forfeit a lease depends on their non-payment of rent, some tenants may seek to undermine the process by ‘paying down’ their debt to just seven days’ rent arrears. This means they cannot be evicted using the usual processes. They may also contest the amount of rent due, which can result in lengthy court proceedings.

Relief from forfeiture

According to the Common Law Procedure Act, a tenant has six months to appeal their eviction by applying to the courts for ‘relief from forfeiture’. Even if you have valid cause for eviction, the court may rule in their favour if they agree to remedy any ‘breaches of covenants’. That may be paying back rent arrears, fixing damage or something else entirely.

Financial difficulties

Handling commercial tenants in financial difficulty can be tricky, they may be able to argue that access to the repossessed property and any equipment contained in it is essential to keeping their business alive. In these instances, delaying the process or considering alternatives may be wise, as it could be tough to recoup any rent arrears if they enter insolvency.

Alternative options

Regardless of the reason your tenant is opposing their eviction, it’s always sensible to consider your options. If your tenant is in arrears and you believe they have the money or assets to cover the amount owed, using Commercial Rent Arrears Recovery (CRAR) to recover the debt may be a better option than repossession. Not only will it recover the arrears, but the cost of recovery is borne by the tenant, whereas any costs of eviction must be paid for by the landlord.

For more information about your options, contact Dukes Bailiffs today.