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Further extension of prohibition on rent-based forfeiture

The restriction of forfeiture for commercial properties has once again been extended until 30 June 2021.

This means that landlords are unable to seek the remedy of forfeiture (right of re-entry) on the grounds of non-payment of rent in commercial premises. 

Whilst these restrictions provide continuing protection for commercial tenants (especially when a great deal of businesses are unable to open or trade), landlords must also consider the impact on their buildings and rental income, especially where non-payment issues pre-date the pandemic.

Despite leases remaining in place and rental arrears continuing to rise and be formally demanded, many tenants are seeking to argue that rent should only be due when premises can be used as intended.  In this regard, all eyes are on the Fraser Group who are making this exact argument to oppose a judgment application in the English High Court for outstanding rent which has accrued during the pandemic. 

No one could predict the duration and scale of Covid and the impact on businesses here in Northern Ireland.  Both landlords and tenants are looking to government for roadmap dates in the hope that the recommencement of trade will mitigate these rental issues...

Editorial prepared by: Maeve Fisher, Partner, Mills Selig

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