Commercial lease disputes are much more complex than other types of property lease agreements. These often involve changing factors that go beyond the control of either party, including zoning commissions, local regulators, other tenants, and customers. A lot of money may be at stake when a dispute arises in a commercial lease. From drafting, negotiating, modifying, and litigating commercial lease disputes, talk to the Katz Law Group about your company's commercial lease disputes.
Commercial Lease Disputes in Massachusetts
There are a number of common issues that come up in most commercial lease disputes in Massachusetts. Like other lease disputes, commercial lease issues may involve different interpretations of the contract terms, changed conditions, minor and material breaches, and terminating the agreement. However, the time and money involved in commercial leases have a large financial impact on both parties.
Most commercial leases average about three to five years; however, these leases can also cover terms of 10 or more years. Commercial rental space can be hundreds of dollars per square foot in Massachusetts. The combination of long leases and high rental costs can mean even a small dispute carries a heavy financial cost. A longer lease may also keep an unhappy landlord/tenant relationship together for years, increasing the risk of additional disputes.
Common areas of commercial property lease disputes may involve:
- Rent increases,
- Assignments and subletting,
- Expansion and improvement options,
- Common area maintenance,
- Responding to maintenance requests,
- Late payments or partial payments,
- Changes in property conditions,
- Code compliance,
- Liability insurance,
- Lease renewal or refusal,
- Other property tenants,
- Zoning laws,
- Security deposits,
- Least termination, and
- Eviction notice.
Commercial Lease Review
A commercial lease review can help avoid many disputes before they arise. An experienced commercial lease attorney understands how to identify problems in lease language, areas that may need clarification, and run through scenarios that could highlight potential disputes.
Many commercial leases involve form or boilerplate lease agreements that may apply broadly to commercial rentals but do not address the specific concerns of the individual landlord and tenant. In some cases, these form agreements may contain provisions that do not apply or are unenforceable.
At a minimum, a company entering into a commercial lease dispute should have the agreement reviewed by an experienced commercial lease and contract attorney. In-house counsel or a general-purpose attorney may not have the experience necessary to identify problems before entering into the contract that can help avoid costly disputes in the future.
Commercial Property Owner/Landlord Breach
A landlord may be in breach of a lease agreement by failing to follow their obligations and conditions under the contract. This may include:
- Construction defects,
- Failure to maintain the property,
- Not responding to maintenance requests,
- Renting other property to competing businesses, or
- Failure to renew the lease agreement.
The commercial property tenant's options for what to do when the landlord breaches the lease agreement are generally spelled out in the contract. This includes determining what constitutes a breach, the parties' options, and remedies after a breach. In many cases, businesses feel limited in their options based on the stronger bargaining power of a large commercial property management company. However, even when the contract appears to limit the tenant's options, the tenant still has rights.
Before engaging in remedies like terminating the lease, withholding rent, or repairing defects and deducting the cost from the rent, talk to an experienced commercial dispute attorney. Your lawyer can help determine your remedies and options, negotiate a resolution, and where necessary, take legal action to enforce the tenant's rights.
Commercial Tenant Breach
The tenant may breach the lease agreement by failing to pay rent on time or failing to properly maintain the property. However, many commercial breaches involve attempting to terminate the lease before the end of the lease terms. If the business is having financial trouble, the tenant may look to get out of the lease without paying any penalties or the costs of a long-term lease.
In some cases, it may be more beneficial to the landlord to renegotiate the commercial lease contract in order to keep the space occupied. Alternatively, commercial tenants may need to take action quickly to maintain a claim over the company's assets before the business goes bankrupt or dissolves.
Lease Renewal and Refusal
Lease renewal and refusal is another area of common commercial lease disputes. The longer the tenant has been in the space, the more important it may be for the tenant to get a lease renewal. However, with changed conditions, the landlord may be looking to get a different type of company in the space or offer the location to a company that is willing to pay more money.
The terms of lease renewals, rights to renew, and renewal conditions may be laid out in the prior lease agreement. When the terms of renewal have significant changes or the landlord refuses to renew the contract, the tenant may need to contact a commercial lease dispute attorney to negotiate the terms of the renewal contract.
Experienced Commercial Lease Dispute Attorney
Commercial leases are often subject to disputes with long lease agreements and changing conditions over time. An experienced commercial real estate attorney can help review the lease agreement, enforce the terms of the lease, and litigate any ongoing disputes between the landlord and commercial tenant.
The Katz Law Group P.C. has 36 years of experience representing clients in a commercial lease and contract disputes. We understand how to negotiate and mitigate commercial lease disputes between landlords and tenants. If your business is dealing with a lease dispute or anticipating a contract breach, contact an experienced Massachusetts commercial property attorney. Contact the Katz Law Group today.