Enforcement of Lease
Termination
When a lease term ends, the tenant is obliged to deliver possession, unless he has an option or a statutory right to renewal. A tenant from period to period, without a fixed term is obliged to deliver possession when it is terminated by notice.
A landlord is entitled to terminate a lease and seek possession where the tenant has failed to pay rent or has breached any of the other terms of the lease. When a tenant is in breach of his obligations under a lease, the landlord will have a number of means of legal enforcement.
Forfeiture
Forfeiture is the landlord’s right to terminate a lease for breach of its terms and conditions. When forfeiture takes place, the landlord re-enters the property and terminates the lease. The right must be specified in the lease. Nearly all leases allow the landlord to forfeit the event of non-payment of rent, breach of covenants or the bankruptcy or insolvency of the tenant.
Forfeiture can happen in two ways. The landlord may issue and serve proceedings for a court order for recovery of possession. Alternatively, the landlord may re-enter the property peaceably. A landlord needs to take care in re-entering without a court order because an offence may be committed if any violence is threatened or there is an element of breaking in the entry.
Peaceable Entry
When a lease terminates by reason of non-payment of rent or after failure to perform the obligations following notice of the breach, the landlord can enter the premises and terminate the lease. This is only permissible if it can be done peacefully.
Peaceful repossession means that the premises aren’t broken nor is the tenant overpowered by force of numbers. In an Irish case where a landlord had a duplicate key and was able to enter and change the locks in the tenant’s absence, there was held to be a valid peaceable re-entry.
Where the landlord cannot peaceably re-enter the property a Court Order will be necessary. It is generally advisable for a Landlord to obtain a Court Order to re-enter a property, as there may be a risk of a successful claim for compensation if a peaceful entry cannot be effected. Forcible entry legislation makes it an offence to forcibly enter the property. This is irrespective of whether the forcible entry is against a tenant whose lease is alleged to be broken.
Rent and Damages
Arrears of rent can be sued for through Court, as a debt collection claim. There would generally be no defence to the claim by the landlord. The tenant cannot generally refuse to pay rent, even if he alleges that the landlord is not in full compliance with his own obligations.
As a lease is a contract, a landlord can sue a tenant for any loss which may fairly and reasonably be considered as arising from a breach of the lease terms by the tenant. Therefore, a landlord can sue for damages for the consequence of the breach. He is entitled to compensation so that he is put into the position (financially) that he would be in if the lease was performed.
The rights to recover rent as a debt and sue for damages are additional to the rights to forfeit. The rights may be exercised together with, separately or indeed, after a forfeiture.
Court Action
In the case of non-payment of rent, a demand for rent must be made before forfeiting unless this is changed by the lease. In the case of breach of other covenants, a notice must be served by the landlord specifying the breach, requiring it to be remedied in a reasonable time or if this is not possible, requiring the tenant to pay compensation for the breach if required. This is not required in the case of rent arrears.
A tenant has a right to seek “relief against forfeiture”. A Court will have regard to the circumstances and the conduct of the parties. Generally, the Court will not wish to forfeit a valuable lease on account of a relatively minor breach. It will typically give the tenant a further opportunity to remedy any breach.
Most actions for possession of property are taken in the Circuit Court. There are a number of different types of proceedings depending on whether the lease has been forfeited, terminated for non-payment of rent, or the property is “overheld” after termination of a tenancy. The legal proceedings are broadly similar to those for possession of a mortgaged property.
Ejectment Proceedings
A Court Order may be necessary to obtain possession of property where a lease has terminated or where there has been a breach of the tenant’s covenants in the lease. Proceedings are generally taken in the Circuit Court.
There are slightly different types of procedure depending on the reason for termination. Some procedures are (relatively) shorter and less complex than others.
Sometimes the Courts will give relief to tenants and will not grant possession unless there have been continuous failures to pay. If the tenant is granted relief from forfeiture this will generally be on conditions that arrears of rent are paid.
Relief
Although the courts, in theory, grant possession orders to a landlord where there is a clear breach, they in practice tend to give tenants the opportunity to remedy breaches and lean against forfeiting leases. Sometimes this is more likely if the landlord or tenant are not perceived to be on equal terms.
Where a lease is terminated by notice it is possible to seek possession based on the tenant’s overholding. The tenant may seek to exercise a statutory right to a new lease. These rights are the subject of other articles.