A commercial lease is an accord between a business and a landlord delineating conditions as well as terms of renting the property. A commercial lease is particular to renters utilizing the property for business or other commercial reasons versus residential application. Most of the businesses around the globe will opt to rent property rather than purchasing it for the reason that it necessitates les capital.
The difference between a residential and a commercial lease is that a residential lease is frequently for properties that are in residential regions or neighborhoods while a commercial lease is for properties in regions that are marked for commercial application.
A commercial lease normally gets into more particular detail concerning the allowed utilizations of the property since there are much probable exploitations for most of the commercial property while a residential lease is less detailed since the owner must comply with the codes of the region (Langley & Stevenson, 2007). Lastly, a residential lease usually assume the property to be the personal apartment or house in question while a commercial lease is a building area with many tenants with many uses, and the landlord ought to be particular on what portion is to be occupied and what is to be done.
The law should seek to safeguard the interest of the commercial tenants more than that of the commercial landlords because most of the commercial lease accords are not subjected to most of the consumer protection decrees that govern residential leases (Langley & Stevenson, 2007). Laws present less consumer protection against dishonest landlord acts in commercial leases, reason being that business individuals are more well-informed. This is because the needs of every tenant are dissimilar and everything is flexible.
The obligation ought to be lawfully placed on the commercial tenant since they are the ones using the property and they will design the interior as they view fit for their businesses. Maintenance means using measures to make sure that a property has not deteriorated in value. Repair means any destruction on the property caused by a tenant and ought to be repaired by the tenant. A normal commercial lease puts all or most of the duties to maintain and repair on the tenant, except that the duties of the tenant may be restricted in case of valid tear and wear, and the landlord may be liable for structural repairs (Hinnells, Bright, Langley, Woodford, Schielerup, &Bosteels, 2008). These obligations under the lease may be depicted as being those of a prudent landlord as well as prudent tenant or that the property ought to be maintained to a standard of first class. Most of the commercial leases present that the commercial landlord will be liable for structural repairs. The widespread interpretation of a structural element is one which is necessary to hold the property together unless the range of structural components is explicitly mentioned in the lease. Accordingly, many of the obligations for maintenance as well as repair of building components that need maintenance will be given to the tenant.
The landlord’s responsibility to mitigate damages implies times when tenants breach part of the lease contact due to various reasons, particularly one of a depressed economy. Because of the challenges, the tenants are frequently not able to conform to the terms of the contract or pay their rent. The commercial landlords are faced with a complex judgment on whether to try and work out things through the difficult circumstances or to evict the tenant (Miller, 1987). However, the landlord does not have the luxury to make such decisions before the tenant vacates the premise. Thus, he is forced to take care of the violation and get redress for the existing damages. The landlord is required to mitigate to recover the damages incurred. This can be done through finding new tenants to replace the one who vacated the premise. The courts ruled that a commercial landlord can mitigate damages by reletting the property as fast as possible. Furthermore, a landlord is capable of evaluating all the situations and facts and find out whether or not selling of the property is more advantageous (Miller, 1987). The landlord can basically have the tenant responsible for rent compensation if that is case, as he attempts to sell the assets, therefore putting the load of carrying the property on the shoulders of the tenant.
The rights of a security deposit favor the both the landlord and the tenant. The landlords are favored since they drafted by the landlords themselves in their favor while the tenant may use the deposit as a means of ending the lease agreement. To a tenant, the deposit secures merely defaults in the reimbursement of the fundamental rent; the chance of disputes is less. A tenant ought to agree with the landlord what the security deposit ought to safeguard. It will be easier to determine disputes down the lease time when the standards are simpler (Hinnells, Bright, Langley, Woodford, Schielerup, &Bosteels, 2008).
The security deposit is favorable to the landlord to make sure that the tenant does not breach part of his or her contract like failing to pay rent or causing destructions to the landlord’s property. Besides, the security may be used to make sure continuous property structural maintenance when needed. For example, the land lord may engage in structural repairs like window replacements, floor, and roof repairs. This type of security deposit is appropriate to make sure that none of the parties involves have breached their terms and conditions. For example, a landlord cannot evict a tenant out of a premise before issuing out a notice (Miller, 1987). Moreover, a tenant will use the property well and carefully while avoiding damages so as to make sure that ending of the lease is without any hitches.
One of the advantages of resolving disputes through mediation and arbitration is that it thwarts hostility. The parties in arbitration are likely to structure a solution on their own with peace rather than augmenting their anger towards one another which is frequent in court cases. Two, arbitration is normally cheaper that filing court cases (Langley & Stevenson, 2007). This is because the process is faster and less complex than litigations. Lastly, the arbitrations are normally flexible to both parties in question.One of the cons of arbitration and mediation is that it has limited recourse. An eventual judgment is difficult to shake. If the award of the arbitrator is senseless or unjust, a party may get stuck to it and be barred forever from filing a court case (Miller, 1987). Two, is that arbitration and mediation takes place on an uneven playing field. Most of the times, the give-or-take nature of the mediation favors the commercial landlord than the commercial tenant who is less potent and has shallower pockets.The mediator or the arbitrator should be selected in a manner that he or she is not associated in any way to the parties in question (Langley & Stevenson, 2007). This helps avoid making bias judgments on a case. Besides, an unrelated arbitrator will be just to the both parties.
I would change the consumer protection laws to protect the commercial lease consumers as a businessperson. This is because most of the consumers in these kinds of agreements are not subject to many of the consumer protection decrees that control residential leases. I believe that all people are equal before the eyes of God, thus they deserve equal treatments (Leviticus 19:18). Treating everyone equally is doing the right thing before God. What is more, I would make sure that there are standard forms in a commercial lease agreement. Most of the commercial leases are not founded on a uniform kind of an accord. This is because every commercial lease is structured to the requirements of the commercial landlord. The bible says that the rich ought to safeguard the rights of the less privileged as well as the needy (James 2:1-5). Some landlords take advantage of the tenants with unfavorable clauses in the agreement conditions and terms. It would also be appropriate to be fair and just in the arbitrations and mediations during a dispute. It is not fair to take advantage of the tenants just because they don’t have the finances and power to fight for themselves. The arbitrator ought to be neutral as King Solomon who made a difficult decision to try and resolve the dispute between two women who were fighting over a baby before him (1 Kings 3:16-28). The arbitrator should also possess wisdom.
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Commercial Lease Agreement for Business. (2019, Aug 20). Retrieved from https://studymoose.com/commercial-lease-agreement-for-business-essay