The commercial tenancy act was designed to protect both the right of commercial property landlords and tenants. It also let each party know their obligations in any lease agreement.
In short, the commercial tenancy act allows landlords to serve written notice to tenants who fail to fulfill their lease agreements. Landlords then have the right to terminate an agreement if the tenant is in breach. Tenants have to fulfill their obligations as set out in the agreement to avoid being in breach of the lease.
Facts about the Commercial Tenancy Act
What should you know about the Commercial Tenancy Act if you lease commercial property or are renting commercial space?
First of all, any landlord or tenant should realize that a signed lease agreement usually takes precedence over the Commercial Tenancies Act. Therefore, it is important to get the proper legal advice before signing a commercial lease.
Leases
The lease should set out all obligations regarding payment of rent, maintenance costs, utility payments, and the length of the lease. It’s then the tenant’s obligation to fulfill the entire lease requirements until the end of the lease.
Depending on clauses in the lease, a tenant who wants to move before the end of the lease may be able to sub-let the commercial space. Or it may be possible to work out an agreement with the landlord.
In cases where the tenant vacates the property before the end of the lease, the landlord can pursue compensation through the courts.
Responsibilities
The lease should set out all the responsibilities of the landlord and tenant in regard to upkeep and maintenance of the building. If these are not set out in the lease, then generally the tenant has to pay for broken equipment inside the building. Usually, the landlord is only responsible for keeping the walls and roof in good order.
If the lease doesn’t specify payment for utilities like heating, water, and electricity, it is the responsibility of the tenant to pay for these.
Evictions
If the tenant is in breach of the lease agreement, the landlord can have bailiffs evict the tenant from the property and change the locks. A breach of lease usually terminates the agreement and the tenant loses the right to remain in the property.
If non-payment of rent is the reason for breach of lease, the landlord has the obligation to wait for 16 days before changing the locks. However, before the 16 days are up, the landlord can inform the tenant that he will arrange to seize and dispose of property to pay the rent. Before disposing of seized property the landlord should hold it for 5 days.
In all cases, it is better to search legal advice before signing a commercial lease agreement or acting to evict or seize a tenant’s property.
