Commercial landlords are often not liable for the expense associated with the running expenses of a building; these expenses are usually covered by the tenant. Commercial property disputes that appear between commercial landlords and tenants are costly and time-consuming. There are many reasons why a dispute may occur, the most common being rent arrears, dilapidation disputes and forfeiture.
At Van Eaton Solicitors in London, we understand that when commercial property disputes arise, the ramifications for the property’s owner or landlord can be enormous. That is why we have created a guide that explains why these disputes occur and what to do if one occurs.
What Causes Commercial Property Disputes?
As previously stated, commercial property disputes can arise for a variety of reasons. One common occurrence is when a tenant fails to pay rent and falls behind on payments. Landlords may find it difficult to recover the funds, which may necessitate expensive legal proceedings. Dilapidation concerns the maintenance of the property and breaches of obligations in that regard by either party , is another reason why disputes may occur. If an area inside or outside the property requires maintenance, it may be hard to determine whether such repair is the obligation of the landlord or tenant, if it has not been established from the beginning or is stated clearly in the terms of the lease..
If a tenant violates the terms of their lease, the landlord has the right to forfeit and may enter the property and terminate the lease. Breach of terms can result in the following acts:
Service of notices, including notices served under the Landlord and Tenant Act 1954 – A landlord may serve a tenant with notice indicating that they must vacate the property by an agreed-upon date.
Lease renewal applications/objections (section 25/26 notices) – the tenant may try to renew their lease only to have the landlord refuse to renew it.
Termination of business tenancies under the Landlord and Tenant Act 1954 – To terminate a business tenancy, the landlord must give six to twelve months’ notice.
Service of section 146 notices under the Law of Property Act 1925 – following a breach, the landlord may attempt to take possession of a property after giving the tenant an agreed-upon time limit to remedy the breach.
How to Resolve Commercial Property Disputes
The primary focus should be on effective communication. Constructive discussions about the situation can help you not only resolve the dispute but also maintain your relationship with the other party. It is recommended that you maintain a constant contact to ensure that the situation does not devolve into a stalemate. All meetings and dealings should be documented in writing, including follow-up letters or emails after face-to-face meetings, so that any meetings or conversations can be referred to later.
It is also recommended that you keep a log of any incidents that occur that may be relevant to the dispute. Remember to write down the date and location, this will come in handy during mediation. If you decide that mediation is the best way to resolve your commercial property disputes, Van Eaton Solicitors can provide a mediation service to avoid a lengthy court process.
When to Take Legal Action?
If, after making every effort to resolve the dispute through alternative dispute resolution (ADR) such as mediation, and arbitration. ADR is a process that allows you to settle a disagreement without going to court. If you disagree, whether with a family member, a neighbour, or a business. ADR can assist you in finding an alternative to the court process. Continue reading to learn about the various types of ADR and where to go next. Learn more about ADR and mediation by reading our previous article. However, if there is no amicable resolution after ADR, you would have to evaluate pursuing legal action.
At Van Eaton Solicitors in London, we act for individuals who are affected by commercial property disputes. If you or your business is involved in a dispute or you wish to pursue a claim on behalf of your business or would like to learn more about ADR, contact us online or by phone on 0208 769 6739 to arrange an appointment.