Commercial Lease, Bond and Administration

[slam]

Hi All,

I have a few quick questions, basically I am the landlord of a new property since last week. The bond has been carried over and I have it in an interest bearing deposit.

The tenants advised me they would be leaving Monday of this week, upon talking to them on Monday to find out whats going on. He said that his company has been put up for liquidation and administration. Given that the commercial lease has expired and is on a month to month basis, he has not paid me for the rent from Settlement until now.

Am I in a position to demand rent as it needs to be paid in advance, or can I make it clear to him that this will be deducted from the bond until he moves out. I have provided the 30 day notice of termination of lease already.

My only concern is that for the bond that I have, is this considered to be part of the assets of the company. The Administration company can come after it, for me to get my share I need to be listed as a secured creditor? But we have a contract in place and the bond is exactly what its used for to cover any rental shortfalls and damages to the property when the tenants leave. I guess for the administration company it would be hard to get them to get the bond off me unless they put it through the legal system. But then what I am entitlted to is fair, otherwise whats the point of a bond if companies just go into receivership and administration.

Any advice / comments? I will be speaking to my solicitor tommorrow. The administration company has yet to contact me despite following up with the tenants a number of times.

Slam

 

[handyandy]

If the company is in Admin then IMHO that bond and any rents owing (or any financial matters) from the date of appointment of the admin will now be under the admin instructions. The person who previously owned the company now no longer controls his destiny or at least until such time that the admin trades out of trouble or the company becomes bankrupt (liquidation).

I have had admins try to claim back various amount that were paid to me saying they were favorable payments but I hung though and kept the money. Bottom line is that unless there is an substantial amount at stake they are unlikely to come after you.

I guess all the angst about all the mods to the building was wasted as you should certainly be able to convince the admin that its not worth his while restoring said property.

Cheers

 

[Cashflow]

Why not keep the bond (in case there is damage that needs to be repaired) and submit an invoice for the outstanding rent? If he hasn't paid the rent then there is a strong chance he wont pay for the repairs either.

Cover any possible scenario with your solicitor and safeguard yourself as much as possible. Also start showing to potential tenants ASAP while this is being sorted out.

Good luck and let us know how you go.

Peter
www.cashflowcalculators.com.au
www.privaterealestate.net.au