_non-residential
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provisions in nonresidential leases that establish the landlord’s and
tenant’s rights and obligations regarding the use and care of the leased premises. Shifting ownership obligations
A nonresidential lease agreement contains two basic categories of provisions establishing the tenant’s obligations to the landlord:
•• rent provisions for the payment of amounts owed; and
•• use-maintenance provisions for the use, care and preservation of the grounds and improvements.
Rent provisions evidence the promise to pay money owed the landlord by the tenant given in exchange
for the possession of the leased premises over a specific period of time. This monetary obligation is separately
enforceable from the use and maintenance provisions.
Use-maintenance provisions in a nonresidential lease agreement establish the rights and obligations of the landlord and tenant regarding who is responsible for performing the care and maintenance of the premises during the lease term.
Use-maintenance obligations are unrelated to the payment of rent. Instead, they identify who will perform or contract for the repairs and maintenance of the leased premises — the landlord or the tenant.
If the landlord retains the majority of the maintenance obligations, the base rent the tenant will pay will likely be higher than otherwise. If the tenant assumes the majority of the maintenance obligations, the base rent the tenant pays will likely be lower.
Just as a tenant breaches a lease agreement by failing to pay rent, he also breaches the lease agreement when he fails to perform or acts in violation of a use-maintenance provision.
The tenant’s breach of an essential use-maintenance obligation is followed by either a 3-day notice to perform or quit stating precisely what must be done by the tenant within three days, or a 3-day notice to quit if the breach is incurable, such as a use violation, the maintenance of a nuisance or waste to the property.
If the noticed breach can be cured and the tenant fails to cure it after notice, he loses the right to possession
if a declaration of forfeiture of the leasehold interest is made in the notice. When the breach is
incurable, as under a notice to quit, the tenant automatically loses any right to continue in possession
and must vacate the premises within three days after notice.
A breach of the use-maintenance provisions by the landlord or the tenant, and the remedies available
for the breach, can be litigated under contract law since the lease agreement is a contract. Not so for the
separate right to possession. When the landlord involves the tenant’s possessory rights in the property as
part of his remedy on a breach by the use of a forfeiture election to terminate the tenancy, landlord/tenant
law controls. [Kendall v. Ernest Pestana, Inc. (1985) 40 C3d 488]
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non residential
Addenda occasionally attached to a nonresidential lease agreement include:
•• terms unique to the type of property leased;
•• a property description addendum, such as a plot map or site plan;
•• a structural or tenant improvement agreement;
•• a condition of premises addendum [See first tuesday Form 560];
•• a building rules addendum;
•• an option or right of first refusal to renew or extend [See first tuesday Form 566];
•• a brokerage fee addendum [See first tuesday Form 273];
•• a tenant leasehold subordination agreement regarding a future loan;
•• a non-disturbance and attornment provision;
•• a signage or tenant association agreement;
•• an option or right of first refusal to lease additional space;
•• authority to sublease or assign; and
•• an option or right of first refusal to buy.
If the lease agreement is for a sublease of the premises, a copy of the master lease should be attached and noted in the agreement.
provisions in nonresidential leases that establish the landlord’s and
tenant’s rights and obligations regarding the use and care of the leased premises. Shifting ownership obligations
A nonresidential lease agreement contains two basic categories of provisions establishing the tenant’s obligations to the landlord:
•• rent provisions for the payment of amounts owed; and
•• use-maintenance provisions for the use, care and preservation of the grounds and improvements.
Rent provisions evidence the promise to pay money owed the landlord by the tenant given in exchange
for the possession of the leased premises over a specific period of time. This monetary obligation is separately
enforceable from the use and maintenance provisions.
Use-maintenance provisions in a nonresidential lease agreement establish the rights and obligations of the landlord and tenant regarding who is responsible for performing the care and maintenance of the premises during the lease term.
Use-maintenance obligations are unrelated to the payment of rent. Instead, they identify who will perform or contract for the repairs and maintenance of the leased premises — the landlord or the tenant.
If the landlord retains the majority of the maintenance obligations, the base rent the tenant will pay will likely be higher than otherwise. If the tenant assumes the majority of the maintenance obligations, the base rent the tenant pays will likely be lower.
Just as a tenant breaches a lease agreement by failing to pay rent, he also breaches the lease agreement when he fails to perform or acts in violation of a use-maintenance provision.
The tenant’s breach of an essential use-maintenance obligation is followed by either a 3-day notice to perform or quit stating precisely what must be done by the tenant within three days, or a 3-day notice to quit if the breach is incurable, such as a use violation, the maintenance of a nuisance or waste to the property.
If the noticed breach can be cured and the tenant fails to cure it after notice, he loses the right to possession
if a declaration of forfeiture of the leasehold interest is made in the notice. When the breach is
incurable, as under a notice to quit, the tenant automatically loses any right to continue in possession
and must vacate the premises within three days after notice.
A breach of the use-maintenance provisions by the landlord or the tenant, and the remedies available
for the breach, can be litigated under contract law since the lease agreement is a contract. Not so for the
separate right to possession. When the landlord involves the tenant’s possessory rights in the property as
part of his remedy on a breach by the use of a forfeiture election to terminate the tenancy, landlord/tenant
law controls. [Kendall v. Ernest Pestana, Inc. (1985) 40 C3d 488]
==
non residential
Addenda occasionally attached to a nonresidential lease agreement include:
•• terms unique to the type of property leased;
•• a property description addendum, such as a plot map or site plan;
•• a structural or tenant improvement agreement;
•• a condition of premises addendum [See first tuesday Form 560];
•• a building rules addendum;
•• an option or right of first refusal to renew or extend [See first tuesday Form 566];
•• a brokerage fee addendum [See first tuesday Form 273];
•• a tenant leasehold subordination agreement regarding a future loan;
•• a non-disturbance and attornment provision;
•• a signage or tenant association agreement;
•• an option or right of first refusal to lease additional space;
•• authority to sublease or assign; and
•• an option or right of first refusal to buy.
If the lease agreement is for a sublease of the premises, a copy of the master lease should be attached and noted in the agreement.
