The build up of commercial rent arrears on one of your properties puts a strain on your own business or personal finances. This is an issue that needs resolving as soon as possible.
Instructing the services of a (bailiff) is an effective way of doing so. They will collect the rent arrears on your behalf at no cost to you as a landlord. This means that you can have your commercial rent arrears recovered without having to pay out any further costs. The tenant pays all the additional fees for the Certificated Enforcement Agent services.
Commercial Rent Arrears Recovery
The issuing of an enforcement notice to the tenant starts the process for Commercial Rent Arrears Recovery (CRAR). This must be sent by a Certificated Enforcement Agent and provides them with a seven day period of compliance to make full payment of their arrears. Tenants can apply to the court for the arrears to be set aside or to obtain a delay of execution.
If they fail to pay within the allotted time, a Certificated Enforcement Agent will attend at the commercial premises unannounced. The bailiff can take control of goods held on the property without full payment. This can be up to the value of the rent owed and any costs. The goods will ultimately be auctioned off to cover the commercial rent arrears if the tenant still doesn’t pay.
What debts can be included in CRAR?
The actual rent arrears is the only element that you can recover through this process. Anything else owed to you under the tenancy agreement, such as service charges and insurance, cannot be enforced through CRAR.
To collect commercial rent arrears under the Courts and Enforcement Act 2007 there must be a written lease in place. You don’t have to go to court to start the process, but the lease must only cover commercial areas.
If a tenant owes you money for additional services you need to apply separately for a County Court Judgement (CCJ) to recover these. Once a CCJ has been issued against the debtor you can have this transferred to a High Court Writ. A Sheriff Officer can then enforce it on your behalf. For more information on how we can help with debt recovery please click here.