Landlord Insolvency: Using a Bailiff

When a landlord is considering distraining or terminating a tenant’s occupancy, he is likely to use the services of a bailiff. The distress against or termination of a lease are covered by the CTA and the Rent Distress Act. The three most frequent distress methods carried out by bailiffs are:

Walk in Seizure

The bailiff attends the premises and negotiates a repayment schedule with the tenant. Once repayment arrangements have been made the bailiff places all goods on the premises under seizure by completing a physical inventory with the tenant. The tenant is then expected to sign a Bailiee’s undertaking stating that all goods are under seizure and that no chattels will be removed. In the event the tenant defaults on the payment arrangement, the bailiff is at liberty to sell the chattels upon expiry of a five day period.

Lock Change

This action will be taken when there is risk that the chattels will be removed from the premises by employees or other creditors. This is done with the tenant’s consent and affords the tenant sufficient time to arrange for payment of the rent arrears without incurring removal costs. If the tenant fails to pay the rent arrears, the goods can be sold from the premises. The tenant must consent to this and be provided with full access to the premises during the period; otherwise it may be construed as termination of the lease.

Removal of Chattels

This action is taken when no agreement can be reached between the tenant and the landlord for payment of the rent arrears. This is the most expensive method of realization. When using a bailiff be certain that the bailiff’s actions do not expose you to unnecessary liability.

For additional information, please contact us.

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