The rules applying to rent due during the period of administration have been changed due to a Court of Appeal ruling involving high street chain Game Retail. The change opens the way for a new ‘pay as you trade’ approach for rent payments by companies which go into administration.

In the judgment in Pillar Denton Ltd & Ors v Jervis & Ors [2014] EWCA Civ 180, the Court of Appeal said Game Retail must pay its former landlords £3m in back rent for the period before it went into administration two years ago.

The court ruled that rent for any period of occupation during an administration will now form part of administration expenses.