High Court clarifies landlord liability for business rates in tenant insolvency

A recent High Court decision has provided welcome clarity for commercial landlords facing business‑rates demands when a tenant enters an insolvency process.

The judgment following the case of City of London v Robinson Webster (Holdings) Ltd [2026] confirms that, where a commercial tenant is subject to a Company Voluntary Arrangement (CVA), a local authority cannot automatically transfer liability for business rates to the landlord unless there has been an express or implied surrender of the lease.

This clarification is particularly significant given years of uncertainty and inconsistent approaches by local authorities, many of which had interpreted earlier case law as permitting a wider reallocation of rates liability.

Interpretation of "entitlement to occupation"

In recent years, many local authorities have argued landlords were “entitled to occupy” premises simply because tenants undergoing insolvency processes were not actively trading.This approach often ignored the ongoing legal rights of tenants under subsisting leases.

However, in the case of City of London v Robinson Webster, the High Court rejected attempts to reinterpret “entitlement to occupation” as a question of practical ability rather than a legal right. It affirmed that business‑rates liability follows legal entitlement, and a landlord cannot be deemed liable simply because they are the “better target” or because a tenant in a CVA is not trading.

Implications for Landlords

The decision has broader relevance beyond CVAs and will likely influence disputes arising from other insolvency processes, including administration and liquidation. Key points are:

• Tenants remain liable where they retain legal entitlement to occupy, even if they are not actively using the property.
• Local authorities cannot ‘default’ to landlords unless there is a genuine surrender.
• Landlords have stronger grounds to challenge rates demands issued during tenant insolvency.

Practical considerations for Landlords

Landlords should keep clear records demonstrating:

• No surrender (express or implied);
• No re‑entry or actions consistent with resuming possession; and
• Continued reliance on the lease terms.

These will be important if a local authority seeks to redirect liability.

The City of London v Robinson Webster judgment restores clarity and balance to an area long fraught with dispute. The High Court has reinforced that legal entitlement, not practical occupation, governs rates liability — a helpful development for commercial landlords dealing with insolvent tenants.

How Hamlins can help

The Hamlins Real Estate Disputes team has expertise in both commercial and residential matters. We seek to obtain the best outcome possible for every client, no matter how big or small the issue may be. If you would like a conversation to find out how we might help you, please get in touch.