Commercial Landlords Ejecting Tenants: More Strategy Less Testosterone

Commercial Landlords Ejecting Tenants: More Strategy Less Testosterone - It’s Cheaper

The first sign that your tenants will stop paying rent is that they will start being nice to you. Treat birthday cards, chocolates and even enquiries as to your health with suspicion.

Landlords may not be universally popular, but they can take comfort in the fact that courts love (or at least don’t dislike) them and hate commercial and retail tenants who cannot pay.

Nevertheless, court actions do cost money, especially if the proceedings are defended, and as much as judges love landlords, they can go all legal.

For instance, they can find that your Notice of Default was defective because:

it is not clear enough;

it does not give enough time;

it contains an incorrect important fact or figure;

it is issued to the wrong person; or

it is not served in accordance with the lease.

In fact, judges can find all sorts of defects in your notice.

You could always serve another Notice of Default to correct the error, but if you have thrown the tenant out it is too late.

A lease is a contract, and if you have terminated the lease without giving the correct notice required by the terms of the lease, then it is you, the landlord, who is in breach. You have let your tenant off the hook, as they are no longer obliged to pay from the time that you unlawfully terminated, until the term of the lease expires. Worse still, their guarantor does not need to pay either. There may even be other claims by the tenant due to your unlawful action, even though it was the tenant who did not pay rent.

Just as in the Fawlty Towers’ episode where Basil tells all the guests to leave, landlords showing their commercial tenants the door should think about it first and not rush into things.

brennans