Why forfeiture?

Forfeiture, if granted, has serious consequences for a tenant or their mortgage company. As such forfeiture action can yield results from the most non-compliant tenant.

A successful forfeiture action may result in the landlord obtaining possession which means the landlord can grant a new lease (subject to relief from forfeiture) and charge a premium. Alternatively, and more commonly, the tenant, or its mortgagee, will apply to the Court for relief from forfeiture to avoid the lease being forfeited. A forfeiture action “raises the stakes” and means the landlord can no longer be ignored.

Landlords and managing agents should always be aware that a tenant or its mortgagee has an automatic right in forfeiture proceedings to seek relief from forfeiture. This is a remedy that is granted at the discretion of the Court. If relief from forfeiture is granted the Court would normally order the tenant to remedy the breach and pay the landlord’s costs.

If your objective as a landlord or managing agent is to ensure that your tenants adhere to the terms of their lease, forfeiture can be a powerful tool in your armoury to ensure compliance. If the tenant does not comply and pay the sums due under the lease and fails to make an application for relief from forfeiture then the landlord may have a commercial opportunity to grant a new lease and charge a premium. However a forfeiture claim progresses we at Simon Burn Solicitors ensure the landlord’s rights under the lease are enforced.