Dispute Resolution

The Scottish Parliament debated amendments to the Coronavirus (Scotland) Bill on 1 April 2020.

The amended Bill passed the same day and received Royal Assent on 6 April 2020. The Coronavirus (Scotland) Act 2020 comes into force on 7 April 2020.

No amendments were made to the original parts of the Bill which will impact commercial landlords and tenants, discussed here https://brodies.com/blog/real-estate/covid-19-commercial-leases-and-the-coronavirus-scotland-bill/.

As a reminder, the key points to take from the Act are:

• Protection for commercial tenants from termination for non-payment of rent – extending the notice period from 14 days to 14 weeks;
• The government can elect to extend the 14-week notice period even after a notice has been served;
• Pre-irritancy notices served on tenants prior to 7 April 2020 become void if they haven’t already expired;
• Tenants are not entitled to a rent holiday. The Act only delays termination for non-payment.
• No protection for tenants in breach for non-monetary reasons, but a fair and reasonable landlord will still have to consider the impact of Coronavirus on its tenants; and
• Landlords can still pursue tenants to recover arrears, but this is proving practically difficult while Courts in Scotland are generally dealing with urgent business only.

As it stands, the Act is due to expire on 30 September 2020, but the Scottish Government has reserved the right to extend this date to 31 March 2021 and then again by a further six months to 30 September 2021.

Matthew Farrell