BLB Solicitors
  • +01225 755656
  • enquiries@blbsolicitors.co.uk
BLB Solicitors
  • +01225 755656
  • enquiries@blbsolicitors.co.uk
  • Home
  • Services for You
    • Conveyancing Solicitors
    • Leasehold Solicitors
    • Property Dispute Solicitors
    • Divorce, Family Law and Mediation
    • Lifetime Planning and Wills
    • Probate and Estate Administration
    • Equity Release Solicitors
    • Retirement Property Conveyancing
    • Personal Injury Compensation
    • Medical Negligence Solicitors
  • Services for Business
    • Commercial Property
    • Commercial Property Disputes
    • Corporate & Commercial Legal Advice
    • Estate Management Solicitors
  • BLB Solicitors Locations
    • Almondsbury Solicitors
    • Bath Solicitors
    • Bristol Solicitors
    • Bradford on Avon Solicitors
    • Swindon Solicitors
    • Trowbridge Solicitors
  • About Us
    • Our Team
    • Working for BLB
    • BLB Solicitors – How we work
    • Making Payments to BLB Solicitors
    • Instructing BLB Solicitors
    • Terms of Business
    • Complaints Policy
    • Interest Policy
  • Blog
  • Contact Us

Home » COVID-19: Pursuing a guarantor of a commercial lease

Commercial Property
Guarantor signing a commercial lease
Oct 26th, 2020

At BLB Solicitors, our goal is simple – to deliver you clear, practical legal advice and cost-effective solutions. We hope you enjoy exploring our Blog. If you can’t find what you’re looking for, please do contact us.

COVID-19: Pursuing a guarantor of a commercial lease

Commercial Property specialist, Caroline Entwistle, highlights some important considerations for landlords considering pursuing guarantors of commercial leases. You can contact Caroline by email, or call her on 01225 462871.

The government’s moratorium preventing commercial landlords from forfeiting commercial leases and evicting tenants for non-payment of rent has been extended until 31 December 2020.

Code of Practice

Where a tenant is unable to pay their rent, either in full or at all, the government is encouraging the parties, particularly the landlord, to follow its “Code of Practice for commercial property relationships during the COVID-19 pandemic”. But, as the Code of Practice makes clear, “This is a voluntary code and does not change the underlying legal relationship or lease contracts between landlord and tenant and any guarantor” (our emphasis).

Key issues

With that in mind, as a landlord, you may be considering a claim against a guarantor. Before doing so, however, there are some key issues to consider. These include, but are not limited to:

  • Is the guarantor in a position to clear any arrears? If, like your tenant, they are also in financial difficulty, are they worth pursuing? Could doing so end up costing you more money?
  • Have any notice provisions contained in the guarantee been complied with? For example, there is often a requirement that the guarantor be notified of the breach within a certain period of time. Failure to comply with notice provisions may prevent a claim against the guarantor.
  • If relying upon an authorised guarantee agreement (AGA), notice must be given to the guarantor within six months of the sum falling due, failing which you will be prevented from claiming from the guarantor.
  • If you are currently considering varying a lease, do not forget to obtain the guarantor’s consent to the variation. Failure to do so may render the guarantee unenforceable against the guarantor.
  • Upon exercise of the guarantee or payment of the debt, the guarantor may be entitled to exercise step-in or other rights. Are you prepared for this?

What should you do immediately?

As the timescales involved in pursuing a guarantor are inevitably tight, it is advisable to check the terms of any guarantee as soon as possible and ensure that any notices are served in plenty of time. Even if you are hoping to avoid relying on a guarantee, or the situation has yet to deteriorate to that extent, it is still crucial to know and understand the position so that you are ready to proceed immediately should the situation change.

With the implications of getting this wrong potentially so serious, you should also consider taking expert legal advice at an early opportunity.

Caroline Entwistle
Request a Call Back

Recent Articles

  • Dilapidations Claims: tips for commercial tenants
  • Dilapidations claims: an introduction for landlords
  • What is an overage agreement?
  • Why buy woodland?
  • What to do about RAAC concrete in commercial buildings

Newsletter Sign-up

* indicates required

Share this article

You may also like...
  • Oct 26th, 2023
    Why have I been told I need independent legal advice?
    Read Article
  • Nov 14th, 2023
    Why buy woodland?
    Read Article
View All Related Articles
Get in-touch today
Contact Form

Left Column

Right Column

Centre

 
Sending
  • Bristol Solicitors

    0117 905 5308
  • Bath Solicitors

    01225 462871
  • Bradford on Avon Solicitors

    01225 866541
  • Swindon Solicitors

    01793 615011
  • Trowbridge Solicitors

    01225 755656
  • Almondsbury Solicitors

    0117 905 5308
Authorised & Regulated by Solicitors Regulation Authority (No. 636644)
©2025 BLB Solicitors | Terms | Privacy | Legal