If your Landlord goes bust...

[AndyPandy]

We rent some Office space. Just made the quarterly rent payment but planted the seed that the next quarter might be more of a challenge.

We had a reply back from the Landlord which I took at face value to mean he wasn't sure what the future would bring, but my fellow Director took a different view, wondering it it had already gone to the wall and queried it with me.

"I know that, should I still be in business, the financial pressures would be enormous."

After looking at the Landlord's website and Accounts it looks like they may have folded or be in the process of folding.

Our Landlord is not the owner, there is an ultimate Landlord for the building.

1. What would happen to our Contract if the Landlord has folded? I don't have it to hand to see if it reverts to the ultimate Landlord.

2. What are the chances of the deposit still being around somewhere? In theory it should have been held separately and the Ultimate Landlord would be also presumably holding an equivalent amount as their guarantee.

3. As we have paid the rent in good faith, if the Landlord reneges on its payment to the ultimate Landlord, where does that leave us?

TIA

[PinkDalek]

I note you haven't looked at your contract (lease?) yet and those more expert than I will no doubt respond in due course but maybe it would be an idea to dig it out, when you can, and provide further clause details.

1. What would happen to our Contract if the Landlord has folded? I don't have it to hand to see if it reverts to the ultimate Landlord.

That would be a possibility or your immediate landlord may be permitted to assign their interests to some other party.

2. What are the chances of the deposit still being around somewhere? In theory it should have been held separately and the Ultimate Landlord would be also presumably holding an equivalent amount as their guarantee.

Should the deposit be in a separately designated account or what? Did you receive anything confirmatory back when you made the deposit and did you have solicitors involved? Is there a separate Rent Deposit Deed and what does it say? Is the Rent Deposit charged - you may be able to find something at Companies House Beta under the Charges section of the company concerned?

3. As we have paid the rent in good faith, if the Landlord reneges on its payment to the ultimate Landlord, where does that leave us?

If you've complied with the terms of your lease it should leave you where you are.



More generally, have you read this (the three months there may be extended dependent on the situation then arising)?:

https://www.gov.uk/government/news/extr ... t-payments

IA most definitely NAL.

[Clitheroekid]

After looking at the Landlord's website and Accounts it looks like they may have folded or be in the process of folding.

If you can name the company I'll have a look myself, and then I can offer some more accurate guidance. Although it's all public information anyway you can PM me if you'd rather not name them.

[AndyPandy]

After looking at the Landlord's website and Accounts it looks like they may have folded or be in the process of folding.

If you can name the company I'll have a look myself, and then I can offer some more accurate guidance. Although it's all public information anyway you can PM me if you'd rather not name them.

OK, so my fellow Director called the LL yesterday and was verbally reassured. Whilst you can never guarantee anything, we have met him personally on occasions and I am inclined to trust what he says.

He has closed the final (of two) retail shops as he is retiring, hence a big 'closing' announcement on his website but the lease where we are (above shop 1) continues. I guess as he is still making the difference between our rent (and the other tenant - who are carers and busier than ever) and what he pays the ultimate LL makes it a no brainer.

The Accounts are full of red ink, but most of that is a personal loan, so manageable.

Thanks to you and PD for your inputs. I won't name the Company publicly at this stage, but might PM you the details once I've slept on it.

Andy