Since April this year (2014) we are into a wave of new legislation under the umbrella of the Tribunals Courts and Enforcement Act 2007. What was formerly referred to as Landlord’s Distress is now to be known as Commercial Rent Arrears Recovery (CRAR.)
There are some material changes to the old legislation and also some tweaking of it. The overall intention is to provide a clearer, more transparent, more viable, more professional and more proportionate set of rules for the benefit of everyone, debtors, creditors and Enforcement Agents. The Ministry of Justice have also issued new National Standards guidelines in a further attempt to standardise the application of the new legislation.
You may note the use of the words ‘Enforcement Agents’ which is the new description for what you previously knew as a Bailiff. From now on, apart from a short transitional period all applications to the Court for certification as an Enforcement Agent move up a gear from the previous procedure, with a requirement for training and a qualification.
As the new legislation is still in its infancy I am sure ‘Best Practices’ will emerge and there may be legal challenges resulting in Court decisions on certain aspects of it. Insofar as the landlords of commercial premises are concerned they are still in a
somewhat privileged position in relation to the recovery of outstanding rent as, unlike other creditors, they do not have to obtain a court judgment, they just have to place an instruction with a Certificated Enforcement Agent.
Some commercial landlords are reluctant to exert too much pressure on defaulting tenants as it may force them out of business and the landlord ends up with unoccupied premises and becomes liable for the business rates. However any delay in commencing action may disadvantage a landlord as there are also likely to be other creditors who may gain preference. My advice is that a landlord should secure his debt by commencing enforcement action as soon as possible, in order to prevent loss of a properly managed enforcement action may result in a tenant being able to continue trading and the landlord recovering what he is owed whilst maintaining occupancy of his premises. It should be noted that third party ownership of assets or other legal intervention such as liquidation or administration can complicate and sometimes frustrate Enforcement Action.
As a very experienced Enforcement Agent I will be able to advise a landlord on how best to deal with your particular problem and hopefully prevent him from falling into any traps which may affect his ability to recover the rent.
Instructions to act could not be simpler with the completion of an Authority to Act – following which enforcement action can commence immediately with the sending out of a Notice of Enforcement. Any rent recovered and paid to ourselves is held in a client account and is normally forwarded to the landlord within 24 – 48 hours of receipt.