Dealing with an insolvent tenant for a commercial landlord

Our client owns land adjacent to the River Thames which surrounds the site on which it operates. The land surrounding our client’s factories is occupied by numerous tenants.

One of its tenants operated in the construction of jack-up barges and leasing of water transport equipment. The tenant fell into rent arrears and was put into compulsory liquidation.

We served notice on the liquidator requiring them to elect whether to disclaim the lease. The liquidator elected to disclaim the lease which brought the lease to an end.

The remaining issue for the landlord to resolve was removing the goods left on site. The “goods” included a cranes (plural), JCB machinery, a barge moored to the land which contains thousands of pieces of metal, office cabins and tonnes of partly constructed metal rigging.

The initial difficulty was identifying the owner(s) of various goods that did not belong to the insolvent tenant, including the cranes and JCB vehicles as, for a few months, no one wished to claim ownership of them. After a campaign of seeking to identify the owners of these goods, notice was served on the owners under the Torts (Interference with Goods) Act 1977 to create an obligation for the owner of the goods to collect them within a reasonable timeframe. The owners of the goods subsequently (and diligently) dealt with the removal of their goods and equipment from our client’s land.

The liquidators identified a buyer for the moored-barge who collected it. The liquidators also arranged for scrap metal merchant to dismantle the partly constructed rigging who then purchased the metal from the liquidators.

Collaboration with the liquidators was key to dealing with the removal of the goods/items left behind by the insolvent tenant. The presence of a sea-wall which could only be opened and closed using JCB vehicles was an added complexity when dealing with the logistics of removing goods from the land.

The landlord received very little in the insolvency against the debt owed to it although its primary concern was having the lease ended and land cleared so it could construct another plant/factory on the land to expand its own operations.