News headline.

In our recent blog post, ‘Playing with Administrators’ Expenses‘, we wondered whether the Court of Appeal would uproot the law as we know it (or at least what we’ve known since 2010) about rent being payable as an administration expense. Well… this morning, they did.

Where administrators make use of leasehold property for the purposes of the administration, then they will have to pay whatever rent falls due (calculated daily) as an expense of the administration. The quarter-day is no longer relevant.

On the one hand, it’s helpful that this is clear cut. On the other, this decision has retrospective effect. Administrators have relied on Goldacre to calculate whether an administration is financially viable. Landlords may bring claims against IPs for unpaid administration expenses – we will have to wait and see what happens in practice.

Unless the administrators specifically applied to Court for a deadline for landlords to file expense claims, they are likely to have to honour these claims – even when the administrations are long since closed and the money has all gone. 

For more information, email

Pillar Denton Ltd & Ors v Jervis & Ors [2014] EWCA Civ 180

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This blog is intended only as a synopsis of certain recent developments. If any matter referred to in this blog is sought to be relied upon, further advice should be obtained.