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Restrictions on landlords extended as Government moves to provide further protection to struggling business tenants

Expert lawyers say relationships between landlords and tenants are now more important than ever following the announcement that the Government is to further extend the restrictions on landlord action for non-payment of rent by business tenants.

Communities Secretary Robert Jenrick announced that the restrictions will be extended until the end of March 2021, having already extended the period twice previously since the introduction of restrictions in March 2020.

Jenrick repeated the mantra that businesses which can pay rent should do so, while also announcing support for the businesses worst affected by the pandemic.

Nicola Seager, partner in the property litigation team at Clarke Willmott LLP, said: “The announcement makes co-operation and communication between landlords and tenants ever more important as we all look to emerge from the pandemic with viable businesses.

“No doubt we will see more discussions about payment plans and rent holidays as tensions rise among landlords who increasingly feel they are being unfairly treated.

“It remains to be seen whether this extension will stop the rush to CVAs as a means to force landlords to accept changes to lease terms and rents. The announcement made no mention of that increasingly popular practice.”

The announcement did confirm:

  • Landlords will not be permitted to forfeit business leases for non-payment of rent until the end of March 2021
  • CRAR will not be permitted until the end of March 2021
  • It will not be possible to petition to wind up a company based on a statutory demand served on or after 1 March 2020 until the end of March 2021
  • It will not be possible to wind up a company for any reason other than failure to comply with a statutory demand without a reasonable belief that the company has not been affected by the pandemic or that the relevant basis for the petition would have occurred anyway

Clarke Willmott is a national law firm with offices in Birmingham, Bristol, Cardiff, London, Manchester, Southampton and Taunton.

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