Forfeiture occurs when the landlord exercises their right to regain peaceable possession against the wishes of the tenant.
This is usually where the tenant has breached a condition of the lease or has breached a covenant. The forfeiture is usually undertaken by a Bailiff (Certificated Enforcement Agent) who enters the property peaceably and takes vacant possession of the property.
Forfeiture is a contractual right under the lease which is a right preserved under Section 24 (2) of the Landlord and Tenant Act 1954.
Peaceable possession under the terms of most lease’s is gained by the landlord’s bailiff entering peaceably on ANY part of the land, which includes any outside compound.
Forfeiture of Lease is a good tool if you can’t execute Commercial Rent Arrears Recovery (CRAR) because the Bailiff (Certificated Enforcement Agent) can’t gain entry to the property. It can also be used where there are little or no goods to seize, or the goods on the site all belong to third parties.
At present, a landlord can forfeit a tenancy on several grounds depending upon the wording in the lease. The most common is none payment of rent. Other reasons include:
The landlord can make a claim for damages for these breaches, but the landlord may also wish to regain possession of his property.
The landlord can only take action to forfeit the tenancy if the tenancy contains a “forfeiture clause”.
The forfeiture clause allows the landlord’s Bailiff (Certificated Enforcement Agent) to “re-enter” the premises following a breach.
The forfeiture clause in the lease would normally say something like “if the rent remains unpaid for a period of 21 days then the landlord may peaceably re-enter and forfeit the lease”.
Depending upon what the breach is for the landlord may or may not have to first serve the appropriate notice under Section 146 of the Law of Property Act 1925.
The costs of forfeiting a commercial lease, also known as evicting a tenant or a “lock-out”, are payable by the commercial landlord and the commercial tenant.
Below is a break down costs required for this service and details of which party is liable to pay.
Cost: £350 (+VAT) plus the Locksmiths’ fee.
The average Locksmith cost is £150, but the price can depend on volume and the type of locks needing to be replaced. Upon request, we can provide a quote for the locksmith. Please note the cost will depend on the types of locks used and the number of locks on the property.
Cost: £125 (+VAT) per Enforcement Agent, per hour.
We will list the tenants’ goods on the property and send the Notice to the tenants’ home address issuing them 14 days to call to arrange re-entry to the commercial property to obtain their goods. Once the Notice period is up, we can remove any goods left by the tenant to clear the premise.
Supervision of the Tenant’s re-entry to the property whilst they remove their goods. (optional service)
Cost: £125 (+VAT) per Enforcement Agent, per hour.
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