The next chapter in the Game litigation and rent as an expense of the administration
In contrast to non-solvency non-payment of rent, where the landlord is entitled to recover the whole quarter’s rent payable in advance whether or not the forfeiture occurred before the quarter ended, in insolvency situations the landlord must prove for rent he is owed.
In 2009, the Goldacre case decided that where administrators continued to trade for the benefit of the company’s creditors from the premises on a rent payment date, the whole of the rent for that period was payable as an expense of the administration, even if the administrators vacated the premises before the next payment date. Landlords welcomed the decision given the growing number of administrations where the administrators continue trading from premises pending a sale to sell off remaining stock.
In the later case of Norwich v Luminar Lava, the High Court held that rent payable in advance, which fell due before the commencement of an administration, was not payable as an administration expense even if the administrator stayed in possession of the premises for the purposes of the administration. Instead, the landlord would have to prove for the unpaid rent as an unsecured creditor. Luminar distinguished Goldacre and restricted expenses of the insolvency process to those that were incurred after the commencement of the process. It led to unsatisfactory situations where administrators could make tactical decisions to enjoy the remainder of a quarter in rent-free occupation of the premises if they timed the appointment after the quarter day…
Click on the link below to read the rest of the Walker Morris briefing.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from Walker Morris
News from The Lawyer
Briefings from Walker Morris
In March, MPs backed legislation for the plain packaging of cigarettes. Health campaigners have welcomed the news; tobacco companies have not.
Contrasting decisions involving applications for registrations of the respective marks GREEN SMOKE and GREENWORLD are instructive in highlighting registry approaches to the concept of distinctiveness.
Analysis from The Lawyer
Which firms are cutting it in this era of slimline rosters, and who are the GC new brooms making clean sweeps? The Lawyer can reveal all
The law school war shows no signs of ending. But we have, perhaps, reached the end of the beginning.