May 2021 - MLP Law

Further Post-Lockdown Considerations for Commercial Property

Welcome to our series of blogs, addressing post-lockdown issues from a legal perspective.  This week sees the latest blog, from our MLP Commercial Property team following on from their previous blog on ‘Considerations for Landlords, Business Owners’ and Tenants’ Post-Lockdown‘.

There are two areas which have been highlighted in various commentary over the past year involving insurance provisions and rent review/rent suspension in leases.

Insurance

A landlord usually insures their premises and recovers the cost of the insurance from the tenant.  As businesses have been affected by the lockdown since March 2020 and the closure of certain businesses deemed to be non-essential, tenants have looked at their leases to see if they can claim benefit of the insurance for which they have been paying and in particular the rent suspension provisions.

What has been clear is that the Pandemic effect was not something generally foreseeable in the marketplace.

The standard insurance provisions essentially cover damage to the property by specified insured risks and if such occurs that a tenant could be entitled to the rent being suspended, with the landlord claiming such suspended rent from its insurer.

Through the case law we see that the “damage” is physical damage to premises and not the reduction in use or closure of premises resulting from a loss of income for a tenant due to the pandemic.  Thus the lease does not provide for suspension of rent in those circumstances nor can the landlord claim against the insurer.

Going Forward

It is clear to see that there are pandemic related provisions being proposed in new leases going forward and on any lease renewal and new leases, the tenants and their advisors should be considering the appropriateness of such Covid related provisions being incorporated into the lease.

The lease could provide that the rent should be suspended during any period whether there is an epidemic, a public health emergency or outbreak of communicable disease or by any Act of Parliament or statutory power including requirement to comply with UK Government guidance or the National Health Service or other health regulatory body guidance in respect of any communicable disease.

Consideration should be had if the insured risks under an insurance policy would cover the above and also if insurers would actually offer cover for the potential of premises having to close and tenants not being able to pay the agreed rent under the lease.  It could be difficult to define (How do you agree what is the trigger for rent suspension and for such rent to be repaid?). The landlord and tenant perspectives are different. What is the impact of any Government assistance?

No doubt going forward there will be more consideration of the effects of the pandemic and if there is any future similar event and how, if anything can be incorporated into documentation to give protection to both the landlord and the tenant.

There is also the impact on an institutional lease where funders require certainty of investment value.  What is the impact on value of pandemic oriented lease provisions?  It will be interesting to see how the institutions and funders are willing to be flexible in this area.

Rent Review

There will have been rent reviews due last year and in the early part of this year which most likely have not taken place.  Depending when the rent was last reviewed (if at all), it will be interesting to see what the market evidence is for the rent that should be payable on the open market between a willing landlord and tenant of a particular premises at the” Valuation Date”.

Commentary indicates rents may now be rising though interestingly, from what level?

If you have any questions or concerns relating to the above please don’t hesitate to get in touch on 0161 926 9969 or email johnl@mlplaw.co.uk.

Relief from Forfeiture

Most commercial leases will give the landlord the right to “re-enter” the property and bring the lease to an end in the event that rent is not paid, using a procedure known as forfeiture.

Because of the draconian nature of this form of self-help – meaning that even a small shortfall in the rent payable would in theory entitle the landlord to treat the lease as being at an end – tenants have the right to apply to the court for relief from forfeiture. The court will usually grant that relief, subject to the tenant making good the breach which gave rise to the forfeiture (which usually means clearing the arrears of rent) and paying the landlord’s legal costs of the proceedings.

However, relief from forfeiture is always discretionary, so it cannot be assumed that the court will simply “rubber stamp” and approve an application for relief. A recent case decided by the Court of Appeal has highlighted that, if a tenant is going to seek relief from forfeiture, they must do so without delay or run the risk that the court will not exercise that discretion.

Keshwala and another –v- Balsood and another concerned commercial premises (with living accommodation above). In June 2018, following a mistake in payment, the rent fell into arrears of £500. On 1st September 2018, the landlord served the quarterly rent demand but made no mention of the £500 arrears. The rent was payable by 29nd September. On 13th September, the freeholder forfeited by re-entry. At this point the tenants became aware of the rent shortfall. A payment of £500 was sent to the freeholder’s agent but was not accepted, and the tenants were told that the freeholder was dealing with the matter.

The tenants duly applied to the court for relief from forfeiture. It was refused at first instance by the circuit judge, on the basis that the application had not been made promptly, but then granted on appeal by the tenants to the High Court. The landlords then appealed in turn and the issue that the Court of Appeal had to decide was whether an application for relief from forfeiture made just within the six month longstop period from the date of forfeiture was brought with “reasonable promptitude”.

On the landlords’ appeal, the High Court had held that, given the statutory period of six months in the Common Law Procedure Act 1852 within which the application for relief had to be made, this formed the starting point for what was reasonable when deciding whether the court should exercise its equitable discretion whether to grant relief. In effect, this would mean that any application for relief brought within the six month period, should be treated as having been brought with “reasonable promptitude”.

The Court of Appeal allowed the landlords’ appeal and held that delay in making an application for relief could be a factor in whether to exercise that discretion, even if (as here) the application had been made within the statutory six month period.

One of the factors that appears to have weighed on that decision was that in this case the landlords had changed their position be granting a new lease to new tenants, on the basis that the previous lease had been brought to an end by forfeiture.

In his judgment, and explaining that the court has a discretion whether to grant relief from forfeiture, Lord Justice Nugee said:

“The discretion is to be exercised (in both the High Court and the County Court) in accordance with equitable principles, including the well-established principle that equity regards the right of re-entry as a security for the payment of the rent, and, other things being equal, the Court will ordinarily grant relief if the tenant pays all that is due in terms of rent and costs. If therefore all that has happened is that the landlord has taken possession and then done nothing with the premises, simply sitting back to see what happens, then the mere fact that the tenant has delayed is unlikely to be regarded as sufficient by itself to cause the Court to refuse relief.

But that does not mean that so long only as the tenant brings his application before the end of the 6 months, he will be treated as having acted with reasonable promptitude, or that his delay will always be regarded as immaterial. The longer that the tenant leaves it – and a fortiori if he does not have a good explanation for the delay, and fails to keep the landlord informed of his intention – the more likely it is that he will find that the Court will conclude that he has failed to act with reasonable promptitude, and the more likely it will be that intervening events will make it inequitable to grant relief. If the landlord, acting reasonably and not precipitately, has altered his position, it may be unjust to grant relief; as also it may be if the rights of third parties have intervened.”

In this case, the combination of the tenants having done nothing – not even informing the landlord of their intention to apply for relief from forfeiture – and the landlord having entered into a new lease with new tenants in light of that apparent inaction meant that the Court of Appeal was unwilling to exercise the discretion to grant relief and to reinstate the tenancy.

The moral of the story is clear – if you are a tenant and need to apply for relief from forfeiture, you must do so promptly, or at least have a good excuse as to why you didn’t act promptly!

If you have any questions or find yourself having to deal with a dispute, please get in touch with the MLP Law Dispute Resolution team by email to mark.turner@mlplaw.co.uk or 0161 926 9969 to see how we can help.

Estate Planning: Managing your affairs in a Post-Covid world

Welcome to our series of blogs, addressing post-lockdown issues from a legal perspective.  This week sees the latest blog, from our MLP Wills, Trusts and Probate team, looking at Estate Planning post lockdown.

Uncertain times often lead us to review our personal and financial circumstances, it can be helpful to consider the practical steps you can take to plan for the future.  Covid-19 has been at the forefront of everyone’s mind during the last 12 months, and this article looks at the key things to consider to getting your life back on track and putting effective strategies in place to manage your business and personal affairs as we come out of lockdown.

We have set out below some things to consider putting in place as part of your estate planning needs:

A Will:

Preparing a Will and ensuring your affairs are in order is fundamentally important. It offers you the peace of mind that your wishes are met, whilst easing the stress of loved ones who ultimately have to administer your estate.

There are many benefits to a properly drafted Will and these include providing for minor beneficiaries and the appointment of guardians, help reduce your inheritance tax liability, asset protection and protection of assets for vulnerable or disabled beneficiaries. Reviewing your Wills in ever changing circumstances can ensure that your instructions are up to date and tailored specifically to your needs and wishes.  It is beneficial to consider the use of trusts in your Will to best manage your affairs and make use of all available reliefs.

Without a Will in place, your loved owns will have no choice but to distribute your estate in accordance with the Intestacy Rules.   The rules determine who should inherit from the estate of the deceased based on the surviving family members. The rules do not take into account personal relationships and who is at need but simply look at the family connections and bloodline.

With today’s wide range of estates and the complexity of family structures, it is important to seek professional guidance to ensure that all matters are dealt with properly.

Lasting Powers of Attorneys:

A Lasting Power of Attorney (LPA) is a legal document that allows you to appoint someone, in advance of deterioration of health, to make decisions on your behalf. This is becoming increasingly important as the risk of mental incapacity grows. However, the key thing in preparing these documents is that they need to be put in place before an individual loses capacity.

There are two types of LPAs, a Property & Finance LPA and a Health & Welfare LPA. Property and Finance LPAs let you appoint someone to make decisions including helping you with finances, managing your taxes, buying and selling assets. The Health and Welfare LPA allows your attorneys to make decisions relating to your personal care, accommodation and life sustaining treatment.

In the absence of an LPA, if you were to lose capacity your loved ones would have to apply to the Court of Protection to be made a Deputy. This process is both long and costly.

Preparing LPAs at an earlier point ensures that you have control over who is appointed and you can make them aware of your wishes, to ensure that they always act in your best interest.

Business Owners:

The turbulence of the last 12 months has highlighted the need for business owners to think about succession planning, this can include putting provisions in place should one part die or review the passing on of shares in the company to family members.

Succession planning for businesses is beneficial for the owners, the company and their clients. By ensuring the company goes through a stable transition, the company is able to continue providing the same quality of goods and services without any interruption.

Business assets may qualify for certain reliefs on death and preserving these reliefs is an important part of the succession planning process as the concern for most is that they have worked so hard to build their company. Preparing a full plan ensures that there is business continuity and the owners or their successors in title are protected.

It is also important for business owners to consider the consequences, should they be unable to make decisions. Business owners can make business LPAs which deal specifically with the needs of the business. This provides the owners with peace of mind that should they lose capacity the day to day running of the business should be unaffected.

Next Steps?

If you require assistance in dealing with your estate and planning for the future, our specialist team are available to discuss your instructions and requirements with you. Our offices are open for covid-19 safe appointments, alternatively we can discuss your instructions via telephone, video call or email.

Contact Details for Wills, Trusts and Probate Team: 0161 9269969 or WTP@mlplaw.co.uk

FAQ – Lasting Powers of Attorney

Welcome to our series of blogs, addressing post-lockdown issues from a legal perspective.  This week sees the latest blog, from our MLP Law’s Wills, Trusts and Probate team, looking at Lasting Powers of Attorney.

Our blogs over the coming weeks will address a full range of topics across all our services – including our corporate, employment, commercial property, private client and family departments –  as we explore various post-lockdown challenges and opportunities.

“What are Lasting Powers of Attorney?”

A Lasting Power of Attorney (LPA) is a legal document in which a person (the ‘donor’) appoints people whom they trust (the ‘attorneys’), in advance of deterioration of health, to help make decisions or to make decisions on their behalf of the donor in relation to their finances and/or personal welfare.

There are two types of LPAs, a Health and Welfare LPA, and a Property and Financial Affairs LPA.

An LPA for Property and Financial affairs is vital for managing your bank accounts, investments and any properties you own should you lose capacity. Your attorneys help to make decisions including helping you with finances, managing your taxes, buying and selling assets.

Health and Welfare LPAs are crucial for giving people you trust a say in the most important decisions, for example, your medical care, where you live and your daily routine, and life sustaining treatment.  Otherwise these decisions are made my medical professionals rather than family or friends who you trust.

 “What happens if I don’t make Lasting Powers of Attorney and I lose capacity?”

If you lose capacity without making LPAs, then your family or friends who wish to help you manage your affairs would need to make an application to the Court of Protection to request the appointment of a deputy to help manage your affairs.  This process can be both lengthy and costly.

Court of Protection applications can take around 6 – 7 months and can be considerably more expensive than Lasting Powers of Attorney. During this time while application is being progressed, there wouldn’t be anyone who could lawfully help you with decisions in relation to your health and welfare or property and financial affairs.

 “I’m a business owner, can I appoint someone to manage by business affairs if I lose capacity?”

The short answer is – yes!

A Business LPA gives the attorneys authority to make decisions in relation to the donor’s business interests. This gives the donor control and peace of mind in that they have appointed someone who they trust and who is familiar with managing the business.  

The Business LPA is entirely separate to personal Lasting Powers of Attorney and is limited only to a specific business.

It is important for any business owner to consider the consequences should they be unable or unavailable to make decisions, and for the business owners to understand what would happen to the day to day running of the business.  The appointed attorney would be able to make decisions regarding the day-to-day management of the business, manage the finances of the business (including investing assets), pay employees and suppliers, sign contracts, manage property owned or leased by the business and more.

“When can my attorneys use the Lasting Powers of Attorney?”

Attorneys appointed by an LPA for Health and Welfare can only act once the donor has lost the capacity to make their own decisions.

When making an LPA for Property and Financial affairs or business interests, the donor can choose as to when their attorneys can use the LPA. This can be as soon as the LPA has been registered or only when the donor has lost capacity.

 “Which type of Lasting Power of Attorney should I make?”

An individual can make both types of LPAs, similarly a business owner can make personal LPAs for their Property and Financial affairs, and Health and Welfare together with a Business LPA.

It is important that you consider your wishes and how you would like matters to be dealt with, should you lose capacity.  It is important to consider carefully who you would like to make decisions on your behalf and ensure that you trust they will act in your best interest.

Our experts can discuss your specific needs and requirements to tailor the LPAs to your individual circumstances and wishes.

If you are interested in setting up an LPA or wish to discuss this further, then please don’t hesitate to contact our team specialists on 0161 9269969 or WTP@mlplaw.co.uk, who can provide swift and effective advice to help put your mind at ease.

Mental Health Awareness Week 2021

‘There is something to be wondered at in all of Nature’ – Aristotle

Mental health awareness week runs from 10th-16th of May. This year the theme is nature, and the Mental Health Foundation has two big aims for what they want to achieve this week. Firstly, to inspire more people to connect with nature in different ways and noticing the impact it can have on mental health, and secondly, to convince decision makers that access to nature and the quality of nature is a mental health and social justice issue as well as an environmental one.

Mark Rowland the Chief executive of the Mental Health Foundation stated that in lockdown, one of the main coping mechanisms that was utilised was going on walks and getting outside. There’s lots of simple ways you can connect with nature; it doesn’t take you to run a marathon to feel the benefits. Something as simple as going for a woodland walk and taking the time to listen to birdsong can do you the world of good.  It doesn’t even take you to go outside to be close to nature, even listening to audios or watching documentaries about nature can increase positive thinking.

Here at MLP Law, we encourage our team go outside and get some fresh air when working in the office and from home. Taking a short break to go for a walk or even just to sit outside is very important and can put things into a better perspective and create a better mind set when getting back to work.

This week is a chance to take small steps to improve our mental health and encourage people to speak up and educate others to listen. For more information and resources to help get you closer to nature this week visit https://www.mentalhealth.org.uk/campaigns/mental-health-awareness-week.

Managing Annual Leave Post-Lockdown

Welcome to our series of blogs, addressing post-lockdown issues from a legal perspective. This week we hear from our Employment law experts discussing managing annual leave post-lockdown.

One aspect which has altered working life, as a result of the Pandemic, has been a blurring of the line between being at work and rest, particularly in terms of time off for annual leave.  Who really wants to take a paid holiday from work when there is nowhere to go and nothing to do!  The issue of holidays has also been fraught for employers, who want to balance an employee’s need for rest and relaxation against the operational requirements of the business.   Indeed, most employers are wary of welcoming staff back to work who have stored up a huge bank of holidays, ready to be taken just when businesses are desperate to drive forward their recovery. 

Therefore, with the likelihood that staff are to be encouraged to return to their places of work over the summer (even if on a flexible or hybrid basis) employers have to be ready to manage annual leave effectively; allowing staff to enjoy their holiday entitlement whilst not disadvantaging a business’s ability to bounce back.

Right to annual leave

In summary, the position regarding annual leave is that workers (and agency workers) have the right to paid annual leave of 5.6 weeks’ each leave year.  This is made up of:

◦ a basic entitlement to a minimum of four weeks’ annual leave (20 days for a regular full-time worker), implementing the right to annual leave under EU law, and

◦ an additional entitlement to 1.6 weeks’ annual leave each leave year (eight days for a regular full-time worker), which is a right under domestic legislation only.  Obviously, some business will have more generous provisions in respect of this additional entitlement.

Annual leave can be taken in a number of ways and the requirements for each business are usually laid out in the contract of employment but the basic premise is:

◦ the worker may give notice of when they wish to take leave

◦ the employer may give a counter-notice refusing a worker’s request for leave, and/or

◦ the employer may give notice requiring the worker to take leave at certain times

With these rules in mind, it is important for an employer to understand the level of control that it has over how and when an employee can take annual leave.

Carry over

Whilst many employers will have ensured that staff were taking paid annual leave regularly during the past year, it will have been something that some businesses will have overlooked, due to other more urgent pressures.  Therefore, understanding the rules of carrying forward annual leave from one holiday year to the next can provide another useful tool in an employer’s armoury, particularly taking into account the recent changes to these rules made in response to lockdown. 

The starting position is that the basic four weeks’ annual leave must be taken in the leave year in respect of which it is due and may not be carried over from one leave year to the next, ie the worker must ‘use it or lose it’, subject to certain exceptions in relation to those who have been:

absent due to long-term sickness

are prevented from taking holiday for other reasons beyond their control

are, or have been, on maternity leave

From 26 March 2020, however, amendments were made to introduce a statutory exception to the rule against carrying forward basic holiday entitlement.  It provides that those workers for whom it has not been ‘reasonably practicable’ to take some or all of their four weeks’ basic holiday entitlement, as a result of the effects of coronavirus (on the worker or their employer specifically, or on the economy or society more broadly), may carry forward such untaken holiday.  This carried-forward holiday may be taken in the two leave years immediately following the leave year in respect of which it was due. 

The aim of this change was to give employers more flexibility to manage statutory holiday obligations and staffing requirements during the coronavirus pandemic and as businesses ease out of lockdown.

It should be noted that staff are only entitled to carry forward the additional 1.6 weeks of annual entitlement if it is set out in a relevant agreement, for instance a contract of employment or collective agreement.  Moreover, a worker is not permitted to be paid in lieu of untaken basic holiday entitlement other than on termination of employment.

Can an employer direct an employee when to take holiday?

Essentially, yes.  It may be that certain restrictions or requirements as to when or how annual leave can be taken are set out in an employee’s contract of employment, for instance requiring that holidays be set aside to cover certain periods, for instance Christmas.

If, however, the contract does not set this out, the default position is that the employer may require the employee to take holiday on particular days, by giving at least twice as many days’ notice in advance of the intended holiday period as the length of the intended holiday (ie 2 days’ notice to take 1 day’s leave).  Similarly, the employer may require the employee not to take holiday on particular days by giving at least as many days’ notice in advance of the intended holiday period as the length of the intended holiday.  This is often used by business to ensure high staffing levels during busy periods.

Although the notice does not need to be in writing, this would be advisable for practical and evidential reasons. The employer must specify the days on which leave is or is not to be taken and, where the leave on a particular day is to be in respect of only a part of a day, its duration.

Furlough

Businesses that have been utilising the CJRS, through either long-term or flexible furlough, will know that furloughed employees continue to accrue leave as per their employment contract.  This will continue until the CJRS ends in September 2021. 

Moreover, furloughed employees can also take annual leave during periods of furlough, which is required to be paid at the employee’s normal rate of pay or, where the rate of pay varies, calculated on the basis of the average pay received by the employee in the previous 52 working weeks.  Therefore, if a furloughed employee takes holiday, the employer should pay their usual holiday pay.

In addition, the government guidance has emphasised that the employer can only place employees on furlough if coronavirus is affecting its operations.   It should not place employees on furlough just because they are going to be on paid leave.  If an employee is flexibly furloughed, then any hours taken as holiday during the claim period should be counted as furloughed hours rather than working hours.

Going Forward

It may be that employers who have previously allowed staff a fair degree of latitude in terms of how and when they take annual leave will have to become more proactive in managing it, at least in the short-term.  Employers will, perhaps, have to be more rigorous in utilising the right to refuse annual leave requests during certain busy periods (busy because of either business need or volume of staff requests) or, at least, restrict the period requested ie allowing 1 week of instead of the 2 requested.  Conversely, businesses may have to schedule and mandate time off in a manner that suits its requirements, for instance, to avoid unfairness amongst staff or to prioritise business need and spread the impact of staff holidays over the holiday year. 

The cushion provided by the changes to carry over rules will allow employers to reassure employees that they will not, ultimately, miss out on some (much needed) rest, whilst allowing the business to nurture its recovery.

If you have any questions or concerns about the above please get in touch with the MLP Law Employment team at employment@mlplaw.co.uk or 0161 926 9969. Please also keep an eye out on our Twitter feed @HRHeroUK and for our regular blogs on all things Employment Law and HR.

Line of Duty?

“When did we stop caring about honesty and integrity” asked Superintendent Hastings in BBC’s popular drama, Line of Duty.

A recent case, focusing on whether or not an employer (in this case the Chief Constable) could be held liable for potential discriminatory actions by an investigatory panel, has highlighted that organised criminal gangs, corrupt police officers and missing evidence aren’t just the stuff of drama.

Facts

Detective Sergeant Nicholas Eckland joined the police in 1998.  In 2018, whilst investigating organised crime networks, he gave evidence at Bristol Crown Court as Senior Investigating Officer.  His evidence concerned the death in prison of a defendant in a drug conspiracy, know as Mr W.  DS Eckland said he’d identified the deceased, but this wasn’t accurate as he hadn’t visited the mortuary.

The Chief Constable appointed a panel to carry out a detailed investigation.  DS Eckland said he’d feared for his life, blaming death threats and the existence of a corrupt colleague.  He claimed this could be backed up by his notebooks but these went missing during the investigation. The panel held that DS Eckland’s inaccurate evidence to the Crown Court amounted to Discreditable Conduct “in that such conduct has a tendency to undermine public confidence in the integrity of evidence given by police officers in legal proceedings”.

Legal Decision

He was therefore dismissed for gross misconduct and brought a claim for disability discrimination against the Chief Constable, claiming that he was disabled by “depression and episodic paroxysmal anxiety”, in terms of the Equality Act 2010.  On a preliminary legal point, the Court, agreeing with Mr Eckland’s position, held that the Chief Constable could be held liable for any discrimination committed by the panel that investigated him.

Chief Constable of Avon & Somerset Constabulary v Eckland 2021

If you have any questions or concerns about the above please get in touch with the MLP Law Employment team at employment@mlplaw.co.uk or 0161 926 9969. Please also keep an eye out on our Twitter feed @HRHeroUK and for our regular blogs on all things Employment Law and HR.

Beyond Covid: What next for litigation?

In the second blog from the Dispute Resolution team in our Beyond Covid series, we look at what a return to at least a degree of normality might mean for commercial and civil litigation.

As in so many other ways, the pandemic has significantly affected litigation. More specifically, it has affected people’s appetite for litigation. Perhaps unsurprisingly, with more pressing things to consider, a significant proportion of companies and individuals have over the past 12 months put disputes on the back burner while they deal with the impact of Covid.

A survey in April of 100 companies in the FTSE350 index by international accountants EY showed that almost two-thirds (63%) reported adopting a conciliatory approach to business disputes since the start of the pandemic.

However, as we edge our way out of lockdown, the majority (59%) now expect claims to be higher than normal in 2021, with 14% concerned that the expected upsurge in litigation could affect their ability to continue trading.

A recent survey of UK law firms by legal services provider LexisNexis noted that, at the end of 2020, the sector most affected by the pandemic was commercial litigation, where firms had seen on average a 30% reduction in fee income compared with 12 months previously. Whilst it’s unlikely that anyone other than litigation lawyers will shed any tears at that news, it does tend to bear out the conclusions of the EY survey, namely that people have been far less likely to become involved in disputes and to commence court proceedings over the past 12 months than normal.

So, as life returns to a modicum of normality, what is the Dispute Resolution team expecting to see over the next few months?

It is anticipated that parties with claims are likely to become more willing to start thinking about pursuing them and commencing formal action – both because less management time is being taken up dealing with Covid-related “firefighting” and can therefore be spent on dealing with those disputes which have taken a backseat over the past months, and also because there is likely to be less financial uncertainty, which for many will have been a factor in whether or not to instruct lawyers to deal with a dispute.

In relation to commercial disputes, we anticipate that there will be an increase in the number of clients either considering pursuing claims or facing claims by others. “The Great Pause” (as some have dubbed the pandemic and associated lockdowns) has undoubtedly interrupted countless commercial agreements. Project time frames have had to change, supply chains have been impacted and contractual obligations have been delayed and in some cases not fulfilled at all. As businesses attempt to get back on track, many will find new obstacles in their paths.

We also anticipate though that residual uncertainty as we emerge from lockdown may well mean that parties are still wary of becoming embroiled in potentially very lengthy and costly litigation and may well be more open to the opportunities provided by Alternative Dispute Resolution, such as mediation. ADR is a much more flexible process than court litigation – and generally much quicker and cheaper – so a willingness from parties to start focusing again on disputes may well not translate into a significant increase in the number of court claims issued.

We touched in our first Dispute Resolution blog in this series on the impact on landlords and tenants. The government announced last week that the restrictions on bailiff evictions will not be extended beyond the current end date of 31 May 2021, and also that from 1 June the Covid-extended notice periods required to be given by residential landlords to tenants will start to be reduced. Restrictions on commercial landlords’ right to forfeit leases where tenants vid-do not pay the rent are also due to be lifted later this year. Both of these factors are likely to see an increase in related litigation, although we think it is probably likely to be gradual over the coming year rather than a significant short term increase.

For those parties who do find themselves in court, the process itself may well be quite different to what they might have experienced prior to the pandemic. Video hearings have had to become the norm and the default option over the past year, despite being used very infrequently prior to Covid.

Recent comments from the senior judiciary have made clear that, while there will be a return to physical hearings for trials and certain other types of hearing that do not readily lend themselves to taking place virtually, procedural and case management hearings are very likely to continue to take place by way of video hearing. Coupled with suggestions over the past couple of years that online dispute resolution for smaller claims should become the norm, we’re likely to see fewer cases where the parties have to physically attend at court.

If you have any questions or find yourself having to deal with a dispute, please get in touch with the MLP Law Dispute Resolution team by email to mark.turner@mlplaw.co.uk or 0161 926 9969 to see how we can help.

Considerations for Landlords, Business Owners’ and Tenants’ Post-Lockdown

Welcome to our series of blogs, addressing post-lockdown issues from a legal perspective.  This week sees the latest blog, from our MLP Commercial Property team, looking at the implications of working from home for landlords and tenants.

Our blogs over the coming weeks will address a full range of topics across all our services – including our corporate, employment, commercial property, private client and family departments –  as we explore various post-lockdown challenges and opportunities.

As restrictions start to lift the burning question is “What is the new norm?”.

The impact of the pandemic in 2020 and going forward will shape a lot of people’s thinking as to how to organise their business matters and investments. An example of this would be determining the impact on their workspaces, seeking to maximise occupation of investment buildings and continued use of remote working options provided by IT (a possible blended approach to office/home working), just to mention a few.

A number of the 50 largest employers in the UK have already indicated that they are not planning to bring all their staff back into the workplace full time. However, some employers will want all the staff back in the office as before due to the nature of their business and the ethos within such business.

The pandemic has seen winners and losers. Some will have found their businesses having to, overnight in March 2020, adopt radical new ways of working which would not have been envisaged a few weeks previously.  Staff being required to work remotely and premises closing altogether: 

1     With the nearly overnight investment in IT to enable remote working, we do not see that those kind of investment will be ignored.  Where businesses have found that employees can work remotely (bearing in mind any positive or negative effects on productivity), future planning should be conducted to see if the business can still benefit from such position.

2     There will be companies that have had a notable increase in business due to their particular placement, product lines and services being offered.  More employees may have been taken on with expansion planned and more space needed.

3     Sadly there will be businesses that will be under contract for current premises that are simply too big or of a surplus to the what the business now needs, and therefore an unnecessary drain on budget.

Businesses may therefore be considering:

-expansion of business premises or relocation;

-reduction in business space.

Where a lease is due for renewal, that opens up interesting negotiations with the landlord. Where a business needs more space, the landlord they are currently under contract with may hold more space available in the office building, the retail park or industrial estate in the current location, and the landlord would surely be delighted to agree terms for additional space to be taken on.  There could also be usual discussion involving the existing lease and additional space to provide favourable terms for the tenant.  Relocation could be a possibility and the landlord may agree to not wait until the current lease expires.

Where sadly a business has found that its space needs to be less, then it needs to look closely at its lease to see what can be done.  Depending on the reason for a reduction and the space requirements, a conversation could be had with the landlord which might be amenable in a particular circumstance of varying the lease terms to retain a business rather than see the business being in dire straits and failing.

A landlord may be faced with a demand for specific types of premises and would want to manage its estate be relocating tenants with new differing needs and thus freeing up space for new tenants.  What is to be remembered is that landlords have invested in the property, be it pension funds or individuals for whom the income from the property impacts on the respective pension funds.

If a landlord is unable or unwilling to adjust the tenant’s terms under an existing lease, then the tenant should consider whether any unneeded space is suitable for underletting and what is the market for it.

Overall there are some interesting considerations that landlords and business owners/tenants will be needing going forward. As the saying goes “it is good to talk” and with these changing times there can be the opportunities for constructive conversations between parties

If you have any questions or concerns relating to the above please don’t hesitate to get in touch on 0161 926 9969 or email johnl@mlplaw.co.uk.

19th Century Marriage Law finally updated!

For the first time marriage certificates are now going to include both the names of the Father and Mother of the couple getting married following a change this month the Marriage Act.

The Home office said the move would “correct a historic anomaly”.

Marriages will also be recorded electronically rather than in a registry book as part of the biggest change to the system since 1837. This is to speed up the process and remove the need for any details to be extracted from hard copies.

Marriages were previously recorded by the couple signing a register book, there are around 84,000 held at register offices and churches.

The Church of England have said “that the change to the system will not change a couples experience of their church wedding”.

If you have any questions or queries related to the above please contact Rachael Wood who is the head of our Family team on 0161 928 1581 or email rachaelw@mlplaw.co.uk.