Can A Landlord Change The Locks Without Notice – Commercial Property UK

If you are wondering whether a landlord of commercial property can change the locks without notice you’ve come to the right place.

I act for landlords and tenants of commercial property in the UK and get asked this question a lot.

The answer is yes, provided that the right to do so exists, has arisen and has not been lost.

If the right doesn’t exist, hasn’t arisen, or has been lost then a landlord can’t change the locks of commercial property without notice (or otherwise) and to do so would be unlawful.

I’ll talk about all of this in more detail below.

Changing The Locks Of Commercial Property

When we talk about a landlord changing the locks of commercial property we are talking about the landlord “forfeiting” the lease by “peaceable re-entry”.

This “forfeiture” brings the lease to an end, and with it a tenant’s rights of occupation.

If the right to forfeiture arose and was exercised correctly then the tenant will be lawfully locked out with no right to occupy the premises in question.

If the locks were changed lawfully the tenant can , in certain circumstances apply to have the lease reinstated.

If the locks weren’t changed lawfully then the tenant should be allowed back into occupation and should be compensated for its losses.

The Right  To Change The Locks Must Exist

Before we get into further detail it is generally accepted that the right to forfeit must be expressly set out in the lease of the premises.

The relevant clause in the lease is likely to say that if the tenant breaches certain provisions of the lease the landlord can re-enter the property.

There is one scenario where a landlord can simply change the locks without notice.

There is another where a notice must first be served giving the tenant a “reasonable” period of time to remedy the breach.  If the tenant doesn’t do so within that period of time the landlord may then change the locks without further notice.

 

When Does The Right To Change The Locks Arise

There are two scenarios where a landlord of commercial property can change the locks.

Non-Payment of Rent

By far the most common scenario where the locks of commercial property are changed arises when a tenant has failed to pay its rent.

Forfeiture clauses in most commercial leases usually state, when a tenant has failed to pay its rent, that the right to forfeit will arise either 7, 14 or 21 days after the rent has fallen due.

So, if the tenant doesn’t pay its rent and there is a clause in the lease such as this, the landlord can change the locks without notice after the relevant period has expired.

Note – if you are a landlord and your tenant hasn’t paid the rent there are other options available to you – take a look at my article on Commercial Tenants Not Paying Rent.

All Other Breaches

In the case of any other breach of the lease by the tenant (such as failure to repair, changing the use without consent, unlawfully subletting – the list is almost endless) the landlord must first serve a “section 146 notice” upon the tenant.

That notice gives the tenant a reasonable period of time to remedy the breach.

If it doesn’t remedy the breach during that period, the landlord can either apply to court for an order to forfeit the lease, or it can change the locks without further notice.

How Is The Right To Change The Locks Lost?

The right to change the locks to forfeit the lease can be lost if it is “waived”.

Waiver occurs when the landlord has knowledge of the breach but does something to treat the lease as ongoing and communicates that in some way to the tenant.

There are lots of ways that this can happen, but the most common is where the landlord is aware of a breach (e.g. it knows that the tenant hasn’t paid its rent) but sends the tenant a demand for future rent due under the lease.

If the right, having arisen, is waived the landlord cannot lawfully change the locks.

 

Changing The Locks of Commercial Property – The Process

Assuming that the right to forfeit has arisen a landlord of commercial property can’t just turn up in the middle of the working day and change the locks while the premises are occupied.

Typically the re-entry will take place at night or early in the morning when the premises are unoccupied.

Force should not be used to remove anyone who is present and opposed to the re-entry – it could be a criminal offence to do so.

It’s common for a landlord of commercial property to employ bailiffs or specialist enforcement agents to enter the premises and a professional locksmith to change the locks.

The landlord or the the agent will fix a forfeiture notice to the property to inform the tenant what has happened and who it should contact.

The solicitors acting for the landlord will usually serve a copy of that notice on the tenant after the locks have been changed also.

 

What Happens To The Tenant’s Belongings?

After the locks of commercial property are changed the landlord will usually serve a “Torts” Notice on the tenant to confirm that it will hold the tenant’s belongings for a short period after which time they may be disposed of.

The notice will often include an inventory of the items that  the tenant has left behind.

The notice will provide details of how and when the tenant can arrange to collect its belongings from the premises under supervision before they are disposed of.

The landlord’s solicitor will usually serve a copy of this notice on the tenant after the locks are changed too.

 

How Can The Tenant Get The Lease Reinstated?

As set out above, forfeiting the lease by changing the locks will bring it to an end.

Where a lease is forfeited, the tenant has the right to apply for “relief from forfeiture” to have the lease reinstated.

This application must be made to court – reinstatement of the lease cannot be agreed between the parties.

Generally speaking a tenant will be granted relief from forfeiture if it remedies the breach (such as paying the landlord all of the rent that is outstanding) as well as the landlord’s related costs.

The idea is to restore the lease as though the locks had never been changed and to put the landlord in the position it should have been in had the breach not occurred.

There is no firm rule for how quickly after forfeiture an application for relief can be made, but the sooner the better as the court has a discretion on whether to grant relief and any long delays could be frowned upon.

 

Interim Options After The Locks Of Commercial Premises have Been Changed

If an application for relief from forfeiture – to have the lease reinstated – is made, it may take several months for the court to process the application.

Assuming that the breach has been corrected and the landlord’s costs have been paid it is quite common for the parties to agree for the tenant to go back into occupation under a temporary agreement until the court order is stamped.

This can be done via a tenancy at will which allows the tenant to get back in and trading and ensures the landlord receives rent whilst retaining control of the situation pending the court order to reinstate the lease being approved.

What If The Landlord Changed The Locks Unlawfully?

If the landlord changed the locks when it shouldn’t have, for example where there was no right to do so, where the right hasn’t arisen yet, or where the right has been waived, the landlord’s actions will be unlawful.

Wrongful Forfeiture

This is called “Wrongful Forfeiture”.

If the landlord of commercial property commits wrongful forfeiture the tenant can apply to court for an order that it be allowed back into occupation immediately, together with damages to compensate it for any losses that it has suffered as a result of the landlord’s unlawful act.

A letter or to from the tenant’s solicitor may be sufficient however.

Case Studies

I’ve recently advised both landlords and tenants of commercial premises about changing the locks.

Case Study 1 – Acting For A Commercial Landlord

I was instructed by a landlord who wanted to change the locks on a commercial unit as the tenant kept failing to pay the rent.

My client needed the rent due from the property to stay afloat and could easily re-let it to a paying tenant.

After looking at everything I advised advised the landlord that it had waived the right to change the locks but that the right would arise again soon.

The landlord was advised to have no further communication with the tenant.

As anticipated, the tenant failed to pay the rent when it next fell due under the terms of the lease.

The right to forfeit arose 14 days later.

We instructed bailiffs and a locksmith to attend the unit early the following morning to change the locks. This forfeited the lease, bringing it to an end.

We served notice of this on the former tenant straight away and, although they were disgruntled, they arranged a time with the landlord to remove their belongings from the unit.

As a result the landlord was able to re-let the unit soon afterwards to a new tenant who pays the rent in full and on time.

Case Study 2 – Acting For A Commercial Tenant

I was recently instructed by the tenant of commercial premises on a retail park.

The tenant had been discussing terms for a new tenancy of the unit with its landlord for some time.

Unfortunately it missed a rental payment due to an internal error without realising.

The landlord could have simply chased for payment and it would have been made.

Instead it changed the locks on the first available date to forfeit the lease.

That was very aggressive, but lawful.

The tenant had sufficient funds to settle the arrears so we contacted the landlord’s solicitors to explain the situation.

We told them that we’d soon be applying for relief from forfeiture, which we did.

In the meantime we agreed a tenancy at will to get our client straight back in and agreed the terms of the court application with the landlord’s solicitors to reinstate the lease which was approved by the court soon afterwards.

The tenant was out of the unit for only two days, so its losses were minimised, and it now has internal measures in place to prevent  this from happening again.

 

So, Can A Commercial Landlord Change The Locks Without Notice?

In summary yes, but only if it does everything right.

I hope that this article has been helpful, that you now have a better idea of when a landlord of commercial property can change the locks without notice, and the things that you need to be aware of if this is something that you are considering or have been affected by.

If you are thinking about changing the locks of commercial premises, or if your landlord has changed the locks on you, feel free to get in touch. I’d be happy to discuss this with you.

 

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