Despite the ending of many Covid-19 financial support systems, assistance with residential and commercial property rental arrears is set to continue as many tenants continue to feel the effects of the pandemic. With a reported 1m tenants building up rent arrears since March 2020, according to the National Residential Landlords Association (NRLA), it’s unsurprising that protective measures, including Breathing Space, have been extended.

But what about landlords?
Bukola says: “A number of regimes and restrictions have been put in place since the pandemic hit but Practice Direction 55C – part of the Coronavirus: temporary provision in relation to possession proceedings – is likely here to stay – at least until next month, with the review date being moved a number of times already.

“However, landlords are struggling to cope with the increasing legislation, particularly where multiple pieces of legislation overlap. This, combined with many tenants struggling to identify their rights, creates an uncollaborative approach between tenant and landlord, which can lead to issues.

“This is particularly true of commercial property landlords within the entertainment industry – an especially hard-hit sector. Two useful high court decisions, Commerz Real Investmentgesellschaft mbh v TFS Stores and Bank of New York Mellon (International) Ltd v Cine-UK Ltd, indicate how the courts will rule where Covid-19 defences are raised in relation to rent arrears.

“In both cases the courts rejected the defences raised by the tenants and gave summary judgment. Both stated, on multiple occasions, that these were detailed commercial contracts with provisions for allocating the risk between parties and there was the option, had the tenants wished for them to negotiate wider terms, for the cessor of rent clause to arrange business interruption insurance. Possession and enforcement action therefore remain the only viable economic option available to landlords for rent arrears and other breaches of tenancy.