The insolvency process in Scotland—impact on the landlord and tenant—commercial leases

Copyright © 2025 LexisNexis
Produced in partnership with Craig Falconer of Addleshaw Goddard
Practice notes

The insolvency process in Scotland—impact on the landlord and tenant—commercial leases

Copyright © 2025 LexisNexis

Produced in partnership with Craig Falconer of Addleshaw Goddard

Practice notes
imgtext

What effect does insolvency have on the operation of a lease? This Practice Note seeks to answer that question and address to some of the most common concerns which may arise on the introduction of an insolvency practitioner (IP) to the landlord and tenant relationship in relation to commercial premises.

Types of insolvency process

It should be noted that the insolvency process depends on where the tenant is located (eg its registered office in the case of a corporate entity) and not the location of the leased premises. For the purposes of this Practice Note, it is assumed that both the landlord and tenant are based in Scotland and that the lease is governed by Scots law.

The main formal insolvency processes in Scotland are set out below.

Corporate

Administration

Administration is a process that operates to provide a framework for the rescue of an insolvent company. An administrator will be appointed and, while the company continues to exist, it will act by its administrator.

Administrators are appointed

Craig Falconer
Craig Falconer

Addleshaw Goddard

Craig is an Associate in the Finance and Projects Division of Addleshaw Goddard LLP. With a commercial real estate background, Craig focusses on all aspects of distressed real estate, acting for lenders, insolvency practitioners and corporates in connection with the acquisition, management and sale of distressed property and has been involved in a number of large portfolio sales. Craig also regularly advises lenders, investors and corporates on all aspects of real estate finance projects.

Read moreRead more
Powered by Lexis+®
Jurisdiction(s):
United Kingdom
Related legal acts:

Popular documents

Dealing with rights of pre-emption on transfer of property in Scotland

Dealing with rights of pre-emption on transfer of property in ScotlandWhat is a pre-emption?A pre-emption is a type of option to purchase—historically the most common and arguably the least complex (at least in the form in which it is created). See Practice Note: Options to purchase

Priority between loss reliefs in loss making companies

Priority between loss reliefs in loss making companiesWhy does it matter?A company that is a member of a group and has incurred any of the types of losses available for surrender by way of group relief may, without any further rules, have more than one way in which to use the loss. There are a

What is the difference between an appeal and a review?

What is the difference between an appeal and a review?What is an appeal?An appeal in insolvency proceedings is no different to an appeal in normal litigation. An appeal will be allowed only if the appeal court is satisfied that the decision of the lower court was 'wrong' or 'unjust because of a

Strike out—making an application to strike out a statement of case

Strike out—making an application to strike out a statement of caseA strike out order can be made either following an application by the parties or on the court's own initiative. This Practice Note deals with the scenario of the order being made following a party's application.Making an application