Leases: re-entry and forfeiture
A practice note that provides guidance on drafting and implementing re-entry and forfeiture clauses in commercial leases in England and Wales. This note examines the landlord's right to terminate a lease following a tenant default, including non-payment of rent, a breach of covenant, or an insolvency event. It explores the essential distinction between a breach of condition and a breach of covenant and discusses the importance of expressly reserving the right to forfeit. This note also considers key statutory and common law procedural restrictions on forfeiture, such as the notice requirements under section 146 of the Law of Property Act 1925 (LPA 1925) and the rules in the Leasehold Property (Repairs) Act 1938 (LPRA 1938). Additional topics include the commercial rent arrears recovery (CRAR) regime, waiver of the right to forfeit, and the rights of tenants, subtenants, and mortgagees to apply to the court for relief from forfeiture.
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