The process for terminating a lease is prescribed by law and this process has to be followed strictly. If the process is not followed correctly, the termination and consequent re-entry by the landlord may be found to be illegal.  This infographic summarises the process to follow when commercial tenants are falling behind on rental payments.

Process for recovery of commercial rent arrears

Act promptly and take legal advice

A notice of termination can only be served if rent is at least 10 working days overdue (see image above) and then the landlord has to wait a further 10 working days from service before it can terminate the lease.  For this reason we recommend landlords act promptly and do not allow months of arrears to accumulate before serving a notice of intention to terminate.  Landlords should also take legal advice when considering re-entry as this must be done peaceably and properly so that the tenant has no grounds for objecting to the re-entry.

Seek advice early

By seeking advice early you can ensure any rental arrears are recovered cost-effectively with the least possible disruption to your business.  We can help you navigate your way through the process and avoid a tenant claim for improper termination.  We encourage our clients to be in touch as soon as they encounter difficulties with tenants.