How Landlords Can Wrest Defeat from the Jaws of Victory? - Difficult but Not Impossible


Art of War cover

Courts usually apply the same judicial consideration to a dispute of $1 or $50M, whereas for commercial landlords, rent arrears of $1 are bearable, but anything over $50 can be stroke inducing. Often landlords adopt the immediate, aggressive and highly satisfying response of kicking out the tenant, changing the locks and using a security guard to bar the door.

There is some fancy legal footwork that the tenant can use to seek relief from forfeiture, but the court will usually not give any such relief if the tenant owes rent and does not repay it before the hearing, which understandably, is not an option for most defaulting tenants. The landlord’s legal and other costs are claimed from the tenant.

Like administering electric shock treatment, landlords often find it hard to stop and the blitzkrieg continues with the issue of court proceedings. At that stage, there is an overwhelming urge on the part of the landlord to stop spending money, impose unreasonable, humiliating terms of settlement and insist on ruinous reparations.

Tenants are usually ready to surrender and enter into a settlement with the landlord. But landlords who want three pounds of flesh rather than the usual one, can spook the tenant into defending the action for fear of losing the family home. This is bad news for the landlord as a defensive position is often easier than being on the offensive

Landlords facing an expensive court action against a tenant with no money can ask for summary judgment i.e. you have a lay down hand and there is no real defence. This can be difficult to prove especially if the landlord has acted unreasonably. There may even be a counterclaim. Afterall, courts like to give defendants their day in court. If courts excluded people who could not afford litigation, judges would have nothing to do.

By being overly aggressive, landlords can wrest defeat from the jaws of victory by making it a far more expensive exercise than it needs to be.


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