Dennis McMahon McMahon Commercial mcmahoncommercial

As if it wasn't already a difficult enough market for commercial property owners, we have just witnessed a whole new threat evolving from an unexpected quarter.

I am referring to the trend amongst receivers to try and claw back rentals from landlords who have received them at a time when a tenant was technically insolvent.

The landlord has probably viewed his actions as simply collecting rental in the normal course of business.

There is no way for the landlord to know if and when a tenant becomes technically insolvent.

It is bad enough for a landlord when a tenant goes into receivership but to then have a receiver attempting to recover large sums of money from him is adding insult to injury.

We have just experienced this first hand with a receiver attempting to claim the sum of $165,000 from us in a respect of a tenant who went into receivership nearly two years ago.

Obviously, we rejected the claim and, over a lengthy period which involved us in substantial legal costs, finally settled on a figure of $25,000.

This was $25,000 too much in my view but the commercial reality is that it would have cost at least that to go to court and have the case heard.

We understand that the practice is rife among receivers involved in commercial properties and, as yet, there has been no test case to determine the validity of such claims.

Most commercial property owners are clearly of the view that it makes sense to settle such matters before it involves a court hearing.

What is needed is for someone of the Sir Robert Jones ilk to take this issue all the way to court to resolve it once and for all.

But then, what receiver in his right mind would be taking Sir Robert on?