Forfeiture of Lease
Beware waiving your right to forfeit

Forfeiture of lease is usually done based on a contractual clause within the lease if the tenant commits a breach of that lease. The most common form of this is for rent arrears which can usually be enforced without notice by peaceable re-entry once the timescale within the lease has passed. This is usually 14 or 21 days, but will of course depend upon the wording of the lease.

Once the right to forfeit has emerged the landlord may exercise that right by peaceable re-entry, but only if they have not acted in any way that may treat the lease as continuing. If they have acted in any way that may be construed as treating the lease as continuing, then they may have waived their right to forfeit for that period.

For instance: If a landlord sends in a bailiff (enforcement agent) to exercise the right of Commercial Rent Arrears Recovery, or sends payment demands, then that could be an act that recognises the lease is continuing and loses the landlord’s right to forfeit the lease for that period.

Should a landlord be considering forfeiting a lease then it is essential they take legal advice as soon as possible and do nothing to waive that right such as accepting any part payment of rent.

Questions to consider

• Is this tenant going to be troublesome long term? If the tenant is habitually late with payment, abusive, breaching other parts of the lease, etc. then it may be more appropriate to forfeit the lease.
• Does this tenant have sufficient assets at the premises to cover the rent and the bailiffs fees? Commercial Rent Arrears Recovery only works as a lever if the tenant has sufficient assets they do not want to lose.
• If the CRAR process fails, can I afford to wait until the next rent period is due before I can take forfeiture action?
• If the landlord has multiple periods of rent that are due for instance two months or two quarters outstanding, they may want to use the strategy of trying the CRAR on the first period/s and leave at least the most recent period of arrears out of the CRAR. Therefore, if the CRAR subsequently fails then the landlord can move to forfeit on the last period of arrears. This strategy seems to have been confirmed in the Faiz & others v Burnley Borough Council [2021] which even went to the Court of Appeal.

We can help

Quality Bailiffs has over twenty five years of experience in Commercial Lease Forfeiture.

About the author

This article was written by Andrew Coates, Authorised High Court Enforcement Officer and full member of The High Court Enforcement Officers Association, and current CEO of Quality Bailiffs.

Andy has a Level 4 diploma in High Court Enforcement, and over twenty five years of experience in the bailiff and investigation industry. He is a former governing council member of both CIVEA and ABI.

This article does not constitute receiving professional advice legal or otherwise, and is meant for educational purposes only. All information is provided in good faith and is used at the user’s own risk. Enforcement Bailiffs Ltd, or its employees, are not qualified or insured to give legal advice and all clients should satisfy themselves of their own legal position before using or proceeding with any of the suggestions, strategies or procedures contained in this guide, and before instructing us.

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