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Thomas Judge
Thomas Judge, Lawyer
Category: Law
Satisfied Customers: 33007
Experience:  Over 25 years experience in law
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We have a contract with a tenant who has missed payments

Resolved Question:

Hi,
We have a contract with a tenant who has missed payments five months in a row. The tenant has promised to pay the outstanding arrears by Monday 26th Oct. My question is, if he settles the arrears is he still in breach of contract as i would like to terminate the contract if we receive the money or not.
Thanks
Submitted: 1 year ago.
Category: Law
Expert:  Thomas Judge replied 1 year ago.
He would technically be in breach but courts are extremely reluctant to evict where the rent is paid up to date if that is the ground for the eviction. Happy to discuss. Please rate positive
Thomas Judge, Lawyer
Category: Law
Satisfied Customers: 33007
Experience: Over 25 years experience in law
Thomas Judge and other Law Specialists are ready to help you
Expert:  Jo C. replied 1 year ago.
Hi.
Thank you for your question. My name is ***** ***** I will try to help with this.
I'm afraid the answer above is incomplete.
Is this a periodic or an AST?
Customer: replied 1 year ago.
Is it asurred tenancy. The 'tenant' acts as a manager for the property. Managing it as a HMO. He does not live there...
Expert:  Jo C. replied 1 year ago.
I presume he has your permission to do that?
Customer: replied 1 year ago.
Yes he does. He essentially rents out the rooms to social housing. He has claimed that they have not paid him to house the vulnerable adults over the past few months and that is why we have not received the payments from him.
I do not trust him and do not want to work with him again especially given he has missed the payments. I want the money that is owed to me and want to terminate the contract.
Expert:  Jo C. replied 1 year ago.
This is essentially an AST.
To evict during an AST you have to show breaches contrary to S8. At the moment he is more than two months in arrears and so you are guaranteed a possession order.
If he reduces it to less than two months in arrears then you can still rely on grounds 10 and 11 to cover any arrears and erratic payment but a possession order is not guaranteed. Do bear in mind that all the tenants proper would be entitled to attend court and make representations and it is amazes how even those who are claiming to be 'vulnerable' can get to court fast enough when they are concerned that their own comfort will be affected.
You can still serve a S21 notice to prevent the agreement renewing but to get him out early you are going to have to show substantial breaches.
Can I clarify anything for you?
Jo
Customer: replied 1 year ago.
Apologies the contract says at the top 'the law society business lease ((whole of premises). Is this still an AST?
Expert:  Jo C. replied 1 year ago.
Not my area then.
I will opt out for others.
Customer: replied 1 year ago.
Ok many thanks for your help.
can anyone else help pls? On a business lease (whole of premises)
Expert:  Thomas Judge replied 1 year ago.
I see my colleague has been trying to help you in my absence. My advice remains correct. Let me try and explain in some more detail. The starting point is presently your tenant is in breach of the lease terms. There are rent arrears. The safest way to evict a commercial tenant is by commencing a possession claim in the County Court; however, if it is acceptable to do so, it can sometimes be cheaper and simpler to exercise ‘peaceable re-entry’. You would need to check the terms of the lease as to whether you have a right to peaceful re-entry. Even if you do I am often nervous about such action as the tenant can still make an application to the court. Your tenant may be able to apply from relief from forfeiture. This will afford them the option to remedy any breaches of the lease, including repayment of all rent arrears and costs (including bailiffs and/or locksmiths fees, if you have exercised peaceable re-entry). From what you have written I would be surprised if they pay all of the debt - but on the basis that they do courts are often sympathetic to them staying there. Happy to discuss. Please rate positive
Customer: replied 1 year ago.
Many thanks for your detailed reply. If I'm honest I hope that he does not make the payment in full as he is very untrustworthy. We are allowed peaceful reentry to the property, the contract states that. So what I should do is wait to see if he pays. If he does he is still in breach of contract and I can still have peaceful reentry?
Or do I have no grounds to renter considering he has settled all arrears including interest.
Expert:  Thomas Judge replied 1 year ago.
I think if he pays in full and you are allowing him this opportunity then it would be a mistake to seek peaceful reentry as he could make an application to the court for relief from forfeiture and the court would often allow him such relief. You would then simply be throwing away money. As such if he pays then you are in difficulties. I would from what you have written be surprised if he pays. Please rate positive
Customer: replied 1 year ago.
Ok thank you for all your advice. I'll sit and wait and see what happens...
Thanks again,
Neha
Expert:  Thomas Judge replied 1 year ago.
My pleasure - can you rate positive for me - thanks