Unpaid March quarter’s rent? Act now to preserve your right to claim this

If you are a landlord and your tenant has not paid the March 2020 quarter rent, it may be possible to pursue the original or former tenant by serving a notice under section 17 Landlord and Tenant (Covenants) Act 1995 (the Act).

The ability to serve such notices for the March quarter’s rent will be lost after 24 September 2020.  Landlords should therefore act without delay if there is a former tenant who could be made to pay the rent where the current tenant is failing to do so.

Section 17 Notices can be served on a former tenant if:

• The former tenant entered into an authorised guarantee agreement obliging it to guarantee the performance by the current tenant; or
• The original tenant, guarantor or former tenant has directly covenant to be held liable to pay rent for the remainder of the lease.

The Act requires that a section 17 notice must be served by landlords within 6 months of the ‘fixed charge’ becoming payable. The ‘fixed charge’ may comprise sums due under the lease, including rent, service charges or liquidated sums due, together with any interest due on the ‘fixed charges’.  The 6 month deadline for the March 2020 quarter rent is 24 September 2020, following which the right to recover the March quarter’s rent from former tenants or guarantors will be lost.

If you are a landlord whose tenant is not an original tenant under a lease and your March 2020 quarter rent remains unpaid, with the deadline for serving a section 17 notice fast approaching, you need to act now to preserve your right to recover rent. We would be delighted to urgently consider whether a section 17 notice can be serve on a former tenant to preserve your right to recover rent.

Joanna Osborne or any of the Property Litigation team at Edwin Coe are available to advise on your former tenant’s liability.

 

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