The Cheques In The Post

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The Cheques In The Post

• Jon Mowbray
• Ralph Bankes
• Real Estate Dispute Resolution

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• Jon Mowbray
• Real Estate Dispute Resolution

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Lease for a term of 15 years from 01.01.1995 Rent
deposit of 1 qtr rent
Landlord (Moneybags Ltd)
Original Tenant (of units 1-4) (Strong Covenant
Co Ltd)
Assignee (Penniless Partnership)
Current Tenant (Skint Desperate Ltd) Guarantor
(Mr Poor)
Sub-Tenant (of units 3 4) (Break Even Ltd)
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Scenario

• Skint owes 50,000 worth of arrears, equivalent
  to one quarters rent
• What are the options available to Moneybags Ltd?

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Options for Moneybags Ltd

• Distrain
• Rent deposit
• Pursue guarantor (Mr Poor) for arrears
• Recover sub-rent from break even
• Recover arrears from Strong or Penniless
• Forfeiture
• Sell goods/equipment

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Distrain against Skint

• Requirements to ensure distraint is lawful
• Must be a tenancy
• At subject premises
• Rent
• Specified times
• Restricted goods

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Distrain against Skint

• Process
• Entry on to premises
• Seizure and impounding of goods
• Walking possession agreement
• Payment or removal of goods
• Poundbreach

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Distrain against Skint

• Reform - Tribunal, Courts Enforcement Bill
• Commercial Rent Arrears Recovery (CRAR)
• Commercial premises only
• Only for pure rent
• Landlord has to serve notice and satisfy criteria
• Tenant able to challenge in court
• Unable to override or extend CRAR system

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Rent deposit and guarantor

• Check terms of the rent deposit deed
• Check terms of guarantee agreement / provision in
  the lease

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Recover sub-rent from break even

• Serve Notice under Section 6 of the Law of
  Distress (Amendment) Act 1908
• Fresh notices
• Potential shortfall

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Recover arrears from Strong or Penniless

• Old Leases
• Serve Notice under Section 17 of the Landlord and
  Tenant (Covenants) Act 1995
• Overriding lease
• New Leases
• AGAs

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• Ralph Bankes
• Real Estate Dispute Resolution

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Forfeiture

• Requirements for lawful forfeiture
• Forfeiture provision
• No waiver
• Process
• Peaceable re-entry
• Court proceedings
• Relief from forfeiture

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Forfeiture reform

• Law commission report, Termination of Tenancies
  for Tenant Default
• tenant default
• No forfeiture provision
• Must serve 7 days prior written notice
• Termination claim
• Termination order
• Remedial order

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Sell goods/equipment

• Serve Notice under Torts (Interference with
  Goods) Act 1977

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General debt recovery

• Scenario
• Mr Cheap Skate owes Ric Surveyor 4,500 in
  respect of unpaid fees
• What are the options open to Ric?

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Options available to Ric

• Issue court proceedings
• Serve a statutory demand
• Issue bankruptcy proceedings

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Court proceedings

• Preliminary considerations
• Is the claim statute barred?
• Is the debtor worth pursuing?
• How much is the debt?
• Process
• Enforcing the judgment

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Court proceedings

• Process
• Letter of claim
• Issue proceedings
• Local county court
• Claim online (www.moneyclaim.gov.uk)
• Judgment in default
• Summary judgment
• Final judgment

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Enforcing a judgment

• Warrant of execution
• Charging orders
• Statutory demand
• Third party debt orders
• Attachment of earnings order
• Oral examination

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Statutory demand and bankruptcy

• Undisputed sum over 750
• Serve on individual/company
• Application to set aside the demand
• Apply for bankruptcy proceedings/winding up order
  if not paid within 21 days
• Cost
• Unsecured creditor

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Questions?
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