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By Jill R. Johnson
February 2015 -
Commercial Office Facilities Article Use Policy
Most eviction issues in commercial leases arise in the context of a self-help repossession provision. Self-help is the process of evicting a commercial tenant without resort to the judicial dispossessory procedure (usually a state statutory procedure). Self-help is typically accomplished by a landlord locking the doors to the tenant’s space and retaking possession of the space. Many landlords are hesitant to ever exercise this remedy (despite the fact that a provision allowing it is, in some form or another, in most standard commercial leases). However, the remedy of self-help has been specifically authorized by many states, provided that the lease contains language permitting the landlord to exercise self-help.
The risks associated with self-help primarily arise from the landlord’s seizure, retention and/or disposal of the tenant’s property in the space. A landlord should include clear language in the lease that details and limits its responsibilities related to the tenant’s property in the event of a self-help eviction.
Though time-consuming, the landlord should take a careful inventory of the property remaining in the space and store it somewhere securely until the tenant is able to retrieve it. It may be tempting for a landlord to try to sell the property to satisfy any past-due rent, but this is not advisable as it is considered tampering with the tenant’s property, and opens the door for a conversion or theft claim. (Again, careful wording in the lease will greatly impact these rights.)
Despite self-help’s bad reputation, there are certain circumstances in which it can be very useful to a commercial landlord. Practically speaking, is it advisable for a landlord with an operating tenant in a fully-stocked space to engage in self-help? Probably not. The hassle and costs associated with the protection of the tenant’s property is likely going to be so excessive as to not make self-help worthwhile.
However, if there is little to no property remaining in the space (where, for example, a tenant has abandoned or partially abandoned the space and is no longer operating), self-help is an option to consider. In these circumstances, the landlord would be required to engage in minimal, if any, efforts to secure the tenant’s property and the landlord gets the space back immediately, without having to resort to the cost and delays associated with a court proceeding for eviction.
In a large center or facility, this may be especially helpful where a replacement tenant may have already been secured for the premises. A landlord in this situation would not get a judgment against the tenant for the past-due rent without filing a separate lawsuit at some point, but the landlord’s priority is likely to get the space back quickly and worry about obtaining a money judgment against the tenant later.
Tenant Build-out And Operating Expense Lease Provisions Can Pose Problems For Landlords
Understanding Self-Help Eviction And Repossession In Commercial Offices
Landlords Should Spell Out Repair and Maintenance Responsibilities In Commercial Leases