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Forfeiture of Lease - Peaceable Possession

Forfeiture of Commercial Lease

“Forfeiture of lease” meaning is that it is the ending of a commercial lease. This is achieved by the landlord exercising their contractual right to end the lease by gaining peaceable possession. It can only be done after a qualifying event has occurred. A landlord may instruct their bailiff to take peaceable possession of their commercial property. This will then achieve forfeiture of the lease. It is a very fast and effective way to get your property back, or to get a tenant to pay.

Most commercial leases contain a “forfeiture of lease” clause allowing the landlord to forfeit the lease if the tenant breaks certain conditions, usually including the non payment of rent, or insurance being overdue for a specific period of time.

Once the tenant has broken any of the conditions, including a long period of non-payment, the landlord must act quickly to “forfeiture of lease”, or be deemed to have ‘waived’ the right to do so.

Please remember an acceptance by the landlord of an arrangement for late payment of rent is likely to be viewed as an act of waiver. Therefore act quickly and instruct us now to get your property back.

Lease Forfeiture Guide

The forfeiture of lease procedure can be found in our free forfeiture of commercial lease UK guide which contains all the likely information you require. This includes forfeiture of lease definition, forfeiture of lease agreement, relief of forfeiture commercial lease and forfeiture of commercial lease by peaceable re-entry.

See our free forfeiture guide

Contact our Commercial Lease Forfeiture Experts

To discuss your requirements contact one of our regional centres today to assist you with recovering your commercial property quickly and efficiently.

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Top 6 Frequently Asked Questions

How much does forfeiture of commercial lease cost?

The cost of a standard lease forfeiture starts from £350 plus vat.

Additional services are charged extra. These are discussed with you before the work is undertaken.

My property has a flat above that the tenant lives in. Can you still do lease forfeiture?

No.

Forfeiture of lease of a mixed use property (commercial and residential) is now illegal.

In the past the forfeiture of lease of a mixed-use property was allowed. This was especially true where the residential element, such as a flat above the property, could be accessed separately after the commercial side had been repossessed.

This changed when in Pirabakaran v Patel 2006, the Court of Appeal clarified the position on whether commercial property can be re-entered when there is mixed use of a flat above a shop used by the tenant. A similar case was also brought under Tan –v- Sitkowski [2007] EWCA. For further information see forfeiture of a mixed-use property article.

What happens about the tenant’s goods?

A Torts notice can be issued at the time of the forfeiture.

Following a lease forfeiture there can be goods belonging to the tenant left behind in the building. The landlord cannot simply dispose of them as they are covered by the Torts (Interference with Goods) Act 1977. The act makes the landlord an involuntary bailee.

For further information see goods left after forfeiture article.

What are the main reasons to carry out Forfeiture of Commercial Lease?

These could be forfeiture of lease for breach of covenant, forfeiture of commercial lease for nonpayment of rent, forfeiture of lease for non payment of service charges.

Can you provide a service to supervise the tenant removing their goods?

Yes.

Tenants cannot be given the key and allowed access to remove their belongings as they could simply re-occupy the premises and take peaceable possession themselves. You would then have to start the forfeiture procedure over again or go through the court.

The solution is to hire Quality Bailiffs to supervise their entry and removal of their possessions.

Usually you can get the tenant to pay as legal and other expenses are the tenant’s responsibility under a clause in the lease. You would need to check your lease about this.

The purpose of supervised access is to ensure a bailiff remains on the property at all times keeping possession, and therefore not giving the ex-tenant the opportunity to claim vacant possession.

If you are concerned the tenant may cause damage or be violent then security officers should be present to prevent this.

Shall I warn my tenant if they do not pay I will instruct you?

No, we strongly advise against this. There are times when notice of forfeiture of lease is appropriate but not for forfeiture of lease non payment of rent.

Giving warning to the tenant could be construed as a wavier of your right to forfeit. The tenant may argue that by this act you are acknowledging that you want the tenancy to continue. Hence why we advise to give no notice of forfeiture of commercial lease.

What happens after I return the warrant ?

Once your warrant is received the following will happen:

• One of our team contacts you within 2 hours.
• They confirm receipt of the warrant.
• Check the details.
• Plan and action the warrant.

Instructions received outside of business hours are dealt with the next business day.

• Your case is loaded onto our online management system.
• The system emails you confirmation of your instruction.
• One of the team will allocate the case to our nearest Bailiff / Enforcement Agent.
• Our office will liaise with the bailiff and locksmith to arrange a suitable time to execute the warrant. This is usually the same day or within 24 hours.
• One of the team will then usually email you with the details of when the warrant will be executed.
• Our bailiff will attended with the locksmith.
• The locksmith will gain access and change the locks (to stop the tenant re-entering).
• The bailiff will take possession of the property.
• The bailiff will serve the forfeiture / possession notices by posting them on every entrance to the property, and photograph them for evidence.
• The bailiff will take a note of the contents, and photograph them.
• The locksmith will secure the property.
• The new set of keys will be returned to you as per the agreed method.
• If required for any court cases the bailiff will provide a witness statement.

You will be kept up to date by either one of the team or by our online management system.

About Lease Forfeiture

It is believed by some that Landlords have had a common law right to forfeit their property. Our understanding is that this must be a contractual right and requires provision for this in the lease.

For most breaches under section 146 of the Law of Property Act 1925, a notice needs to have been served and expired. This does not apply to none payment of rent which is covered under S. 146 of the Law of Property Act 1925 (11).

Forfeitures can usually be carried out by Quality Bailiffs within 24 hours of instruction on a low fixed fee.

We have a pre-approved panel of locksmiths across the UK to recommend to you if you do not want to use your own locksmith.

Where is the forfeiture clause?

It is a clause in the lease that specifies that if certain events happen (breaches of the lease) it will activate the clause. This will then trigger penalties which will usually include forfeiture by peaceable re-entry. For this reason, it is sometimes referred to as a re-entry clause.

There is usually a period of time allowed before the clause is activated. For late payment of rent this is often 14 or 21 days.

Relief from Forfeiture

A tenant, sub-tenant or a lender can apply to the Court for relief from forfeiture to allow the tenancy to continue. In practice, however, the Court can impose conditions, which might require the tenant to pay any rent arrears or remedy the breach before this is heard.

Contact our Commercial Lease Forfeiture Experts

To discuss your requirements contact one of our regional centres today to assist you with recovering your commercial property quickly and efficiently.