Solicitors at a leading Leamington Spa law firm are urging landlords and tenants of commercial properties to work together in the wake of forfeiture restrictions lifting this March.

The Coronavirus Act 2020 was introduced at the height of the pandemic to provide a host of protective measures including to tenants who were not able to pay rent.

The provisions in the act meant that landlords were unable to forfeit or obtain possession of commercial leases for unpaid rent, are restricted in forcing tenants into any form of insolvency and are restricted in enforcing the terms of leases by way of commercial rent arrears recovery.

These rules are set to end next month and Jagdeep Sandher, head of dispute resolution at Rugby Road-based Blythe Liggins, says there are several issues that will remain once those restrictions come to an end.

He said: “It’s no secret that the pandemic created a knock-on effect with so many tenants and landlords around the country, regardless of how big or small they are.

“So many businesses were affected by the forced closures and had seriously impacted tenants’ ability to pay rents.

“As we slowly emerge from the Covid-19 pandemic and the economy returns to a semblance of normality, it is important that tenants and landlords understand and work together to reach amicable and workable solutions.

“In June last year, the government announced a plan for intended ringfencing of rent arrears that were accrued during the pandemic and for a scheme of mandatory arbitration, essentially as a way of ensuring that the pain of the pandemic is shared between landlords and tenants alike. As such, it’s anticipated the Commercial Rent (Coronavirus) Bill will become law by March 25, when the other restrictions come to an end.”

Jagdeep said the act has been massively beneficial in helping keep tenants afloat, but landlords and tenants now need to work together to ensure amicable partnerships continue and properties around the country aren’t left empty.

“It must be noted that any arrears which don’t fall within the ringfenced scheme can be enforced in the normal way. The mandatory arbitration will be binding on the tenant and landlord, so both should act reasonably during the discussions as the outcome of any arbitration may not be as favourable as a negotiated settlement,” he added.

Caption: Jagdeep Sandher, Head of Dispute Resolution at Blythe Liggins in Leamington.