Ahead of the first quarter day of 2020 tomorrow, where many businesses will be obliged to pay an instalment of rent pursuant to a commercial lease, the Government has announced that there will be a moratorium on forfeiture of commercial leases for non-payment of rent. This is to protect commercial tenants from being evicted if they are having cashflow issues and cannot pay their rent because of COVID-19. The moratorium will be put in place for three months, but could be extended later. It is important to note that this only applies to forfeiture for non-payment of rent.

The Government has not made it clear whether the moratorium will extend to prohibit landlords from issuing a statutory demand in respect of rent arrears during the next three months, or whether landlords will also be prohibited from utilising the CRAR (Commercial Rent Arrears Recovery) process. Landlords and tenants are advised to reach an agreement on payment of rent where the obligations under the lease cannot be met. Switching to monthly rather than quarterly payments of rent or agreeing a deferral of payments are all viable options to pursue.

The Geldards Dispute Resolution Team has the expertise to assist you with all of the aspects outlined above. For more information please contact a member of our Real Estate Litigation Team

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