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Forfeiture

A forfeiture clause, which is contained in almost every commercial lease, provides the landlord with the legal ability to re-enter the property and end the tenancy in order to protect their interests.

Mark Oakley

Partner

Property Litigation

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Dispute Resolution Specialists

Property Law Experts

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From a landlord’s perspective, if a tenant breaches a tenancy covenant or fails to pay rent, they may want to exercise their rights under the forfeiture clause. At Judge & Priestley, we will ensure that if you do choose to do this you follow the correct procedure, thus avoiding any financial or reputational repercussions.

There are two reasons a landlord may exercise his or her right to forfeit a lease:

Breach of the covenant to pay rent
The issuing of a Section 146 notice for the breach of any other covenant aside from non-payment of rent

Forfeiture of Commercial Leases

Although most commercial leases contain a clause entitling the landlord to make a peaceable re-entry in the case of rent arrears, the safest option you can take as a landlord is to obtain legal advice and a court order. The order is known as a Section 146 Notice (and is the only way to forfeit a lease for any other reason other than non-payment of rent).

Contents of a Section 146 Notice

A Section 146 Notice must contain the following:

How the tenant has breached their lease.
Ways to remedy the breach.
The time limit for remedying the breach.
Any demands for compensation

Your solicitor at Judge & Priestley will take you through this process step by step and ensure that the time limits for remedy and requirements for compensation adequately cover and protect your best interests.