Property Law 10 - CRAR

Question 1

What is Commercial rent arrears recovery (CRAR)

Answer 1

A Self-help remedy that is generally cheaper and quicker than court proceedings.

Question 2

In what circumstances can Commercial rent arrears recovery (CRAR) be used?

Answer 2

• the premises are purely commercial (it cannot be used, for example, where the premises comprise a shop and residential flat)
• a minimum of seven days’ principal rent is owed (it can’t be used to recover service charge or any other sum reserved as ‘rent’ but does include VAT and interest)
• the lease has not been forfeited

Question 3

What types of arears can CRAR be used for?

Answer 3

Only includes principle rent + Interest + VAT

It can’t be used to recover service charge, ‘insurance rent’ or any other sum reserved as ‘rent’

Question 4

Who must conduct a Commercial rent arrears recovery (CRAR)?

Answer 4

• the landlord must appoint an enforcement agent who either has the required certificate from the court or is exempt from the requirement (eg, a police officer)

Question 5

How much notice must the LL give the Tenant for CRAR if he intends to enter the premises?

Answer 5

Seven clear days’ notice must be given of the intention to enter the tenant’s premises (clear days exclude Sundays and bank holidays)

If the notice expires without repayment of the debt, the enforcement agent can enter the premises and take control of goods belonging to the tenant up to the value of the debt owed.

Question 6

What must be included in a CRAR notice?

Answer 6

The notice must include certain details, such as
- the amount of the debt and
- how to repay it,
- details of the power being used to enforce the debt, and
- contact details for the enforcement agent

Question 7

When can the LL sell the goods seized under a CRAR notice?

Answer 7

The landlord must serve a further seven clear days’ notice if it intends to sell any of the seized goods.