Eviction is the legal process of a tenant and the tenant’s personal property being removed from the building he or she has been renting. Residential tenants live in rented properties, and commercial tenants run businesses or occupy office space in rented properties.
If a property owner has grounds to terminate a lease or a rental agreement with a tenant, the commercial eviction process can be initiated.
Uniform Residential Landlord and Tenant Act (URLTA) is a federal code that regulates protections for residential tenants. However, many of these protections are not available to commercial renters. The commercial eviction process can be much quicker than the residential eviction process, with the commercial renter having fewer options for reconciliation than the residential renter.
Commercial landlord tenant law is comprised of state, local, and regional regulations and codes. Legal cause for commercial eviction is therefore variable. In many states, however, a commercial landlord might evict a commercial renter for the following reasons:
- Failure to pay rent: Commercial renters often have far less time to settle rent arrears or issues of back rent than residential renters might. Commercial landlords are often more likely to strictly enforce rent deadlines.
- Misuse of property: Commercial tenants have to adhere to planning and zoning codes that are legislated by local, state, and federal municipalities. Failure to do so could cause liability issues for the landlord. Violating these codes could be grounds for commercial eviction.
- Breach of contract: This is also known as a lease violation. If a landlord has written specific requirements for the commercial tenant into the lease, and the tenant does not fulfil these requirements, the landlord may use commercial eviction as a legal remedy.
While procedures for evicting commercial tenants vary from state to state, many states adhere to similar guidelines for eviction procedures.
- Three Day Notice: The landlord or the landlord’s attorney must write a Three Day Notice stating that, if owed rent is not paid in full, or other lease violations or contract breaches are not fixed within three days, then the tenant will be evicted and legally required to leave the property.
- Service and Proof of Service: The Notice must be served to the tenant according to applicable state and local regulations for service. In some states, the process server can leave the notice on the door. In others, the service must be handed directly to the tenant or another representative of the company. Proof of service forms should be filled out and kept for potential court proceedings.
- Unlawful Detainers: If the tenant does not pay the owed rent in full or otherwise correct lease or property use violations within three days of being served, the landlord can serve an unlawful detainer notice. This alerts the tenant that they are now occupying the property illegally. The tenant will then be informed with another notice of how many days they have to vacate the property and remove personal items.
Defenses for evictions of commercial tenants vary state to state as well. It is best to consult a lawyer who is familiar with landlord tenant law and who is experienced with mounting successful eviction defenses in order to devise the best defense for a particular circumstance. These defenses include:
- Equitable defenses – If a landlord does not properly go through the eviction process, a tenant can ask the court to delay, or even end, the eviction. One of these is known as Short Notice. Although the eviction of a commercial tenant can legally happen in a short period of time, sometimes a court will grant more time to a commercial tenant to remedy the breached lease or repay the owed rent.
- Quiet enjoyment – Many states recognize the doctrine of quiet enjoyment. Tenants have the right to use their rented property unimpaired and for the purpose that they rented the property for. If the building is in such a state that a tenant is unable to operate its business, then the landlord has no right to evict the tenant.
- Urban blight – Committing waste to a building is a defense against an eviction lawsuit. For instance, in New York, a landlord is not permitted in most states to allow the property to unreasonably decay. Urban blight is different than quiet enjoyment in that the former is about whether the property is subject to decay, while the latter is about whether the property can be used for the tenant’s business.
- Lease provisions – While there is no legally mandated warrant of habitability on commercial leases in most states, tenants can negotiate conditions into their lease that protect them in case the landlord neglects to fix problems in the building or to conduct routine maintenance. These kinds of lease violations on the part of the landlord might protect the tenant from eviction.
Because commercial evictions can happen very quickly, and because commercial tenants have fewer protections afforded to them than residential tenants do, it is important to consult a real estate lawyer if you think you might be at risk for a commercial eviction.