Is It Time for Distraint in Place of Unpaid Rent?
When a tenant of commercial premises does not comply with the terms of a lease agreement and withholds rent, the landlord or owner has a number of options. In the first case, they should do their best to persuade the tenant to pay the outstanding dues and be very clear in their form of communication. Sometimes, however, this approach may not work, and further action may be necessary. If you're in this position, what do you need to know about a process known as 'distraint'?
Seizing Goods
Under Australian law, you may be able to seize goods that belong to the tenant and are within the rented premises. With due process, you may then be able to sell them at auction and to keep the proceeds in lieu of collecting the outstanding rent. This process of distraint is well-established and is definitely an option so long as you fully comply with the letter of the law. Contact a legal process server to learn more about this option.
Process Serving
To begin with, you should enlist a process server to perform the actions and make sure that they are fully experienced in this particular field. After all, there are a number of different rules to follow, and you need to be careful to make sure that you do not fall foul of the regulation.
Important Considerations
For example, goods can only be distrained at certain times of the day, and you may only take those goods that are within the actual premises. Importantly, you must ensure that you do not take goods that actually belong to a third party or that have some kind of security against them. Also, you are not allowed to take any tools or other similar items that could be classified as "implements of the trade." Be very careful to ensure that the tenant in question actually owns the goods, as if you were to sell them at auction and this was not the case, then the owner could take legal action against you and collect substantial damages.
Serving the Notice
The process server will need to give the associated warrant to the tenant or make sure that it is prominently displayed at the premises. They will also be required to write up a complete inventory of any distrained goods and either give this to the tenant or display it in a conspicuous area.
Time for Action
If you have come to the end of your tether and need to get some money from the defaulting tenant, think about procuring a warrant to distrain. Talk with an experienced process server, and they will be able to guide you through the process before performing the necessary action.
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