Commercial Lease Advice Wanted

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networkn

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#113458 17-Jan-2013 15:09

Hi,

A few months ago we got broken into. We lease our offices, and to get in they broke a window and damaged some aluminium. Total cost was around $500.

I had been under the understanding that damage to the building itself, if not caused by me, especially the exterior, is the responsibility of the landlord, and that he would reimburse us (He was away at the time so I couldn't confirm).

We have sent him the invoice and he has come back to us and said it's our responsibility under a clause our lease agreement that states we are responsible for glass. I contacted our insurer who said we cannot insure something we do not own, and therefore this would be the landlords responsibility.

Initially he took the invoices and tried to get the body corporate to pay them, and they refused saying it wasn't worth claiming on the insurance as the excess was higher than the amount being claimed.

I am pretty concerned at this stage, because if they decided next time to roll a truck through the front door, we would be in some trouble.

Anyone got any ideas?

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#746422 17-Jan-2013 15:49

The fact that the body corp declined to claim on their insurance because it was worth less than their excess, not because they said it was not our problem, says to me that they should be liable, and should fork up from the buildings maintenance and repairs fund

As a tenant I would ask your landlord for a copy of the body corp agreement so you can get a better understanding of where the liability is,

but from what you have said, it is damage to the outside of a property that is unit titled and thus likely to be in the lap of the Body corp.....

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#746490 17-Jan-2013 17:39

networkn: We have sent him the invoice and he has come back to us and said it's our responsibility under a clause our lease agreement that states we are responsible for glass. I contacted our insurer who said we cannot insure something we do not own, and therefore this would be the landlords responsibility.

When the cafe was broken into mid last year, I had this exact discussion with my landlord and insurer.

We ended up taking it on the chin ($2k pane of glass) - sucks big time.

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#746494 17-Jan-2013 18:06

I guess we have a good landlord then!,

About a month ago we had a couple rocks thrown at 2 of our big windows ($3k Worth of Damage) our landlord covered all costs, We just had to pay for the new sign writing to go on.

sleemanj

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#746526 17-Jan-2013 18:54

Advice from a lawyer who has read your lease agreement is what you need in this case I think really, commercial leases largely stand and fall on what is written in them.

Been a long time since I've had a commercial lease, but if it's standard to have the lessee responsible for window damage, then I'm sure that your insurer can insure you against such claims, perhaps you need to speak to somebody higher up at your insurers to clarify the situation.

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#746534 17-Jan-2013 19:14

I know a place where the landlord provides insurance such as fire and building compliance checks/certification etc... the leasee would have to buy their own insurance. When they used to lease, they were with a insurance company from a burglary. Ie. broken glass, window etc .. .

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#748767 22-Jan-2013 13:28

Man I attract the worst landlords.

Today I come in and a leak has developed from the drainage in the property and for a short time the most foul and putrid smelling brown liquid has seeped into my corner office for the third time since we moved in. Volume is more than before though not significant, but enough to run down the wall and into the carpet.

Called the landlord and he has said someone will be in by the end of the week, but he won't pay for someone to come and clean the carpet and he can't smell anything offensive (Despite all my staff complaining and me having to work from home yesterday afternoon). He has told me if I have a problem with it, I can get off my a$s and clean it myself.

I am 99% sure this isn't my job, especially since it's the third time it's happened and it wasn't fixed obviously the times before. I cleaned the last two up because they didn't seep into the carpet, but I think the carpet will need to be cleaned.

sampler

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#748770 22-Jan-2013 13:34

Sounds like its time to move, At the moment there are loads of commercial buildings around that require good tenants.

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trig42

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#748772 22-Jan-2013 13:36

Bummer, and I suppose if you don't clean the carpet, when it comes time to move, he will charge you for it...

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#748773 22-Jan-2013 13:36

sampler: Sounds like its time to move, At the moment there are loads of commercial buildings around that require good tenants.

I would but it would be expensive to move as we have set contracts in place for things like Internet, and we have spent money in this property which we would lose and have to re-spend in the new place.

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#748775 22-Jan-2013 13:37

trig42: Bummer, and I suppose if you don't clean the carpet, when it comes time to move, he will charge you for it...

Not to mention it's pretty unpleasant to work in that space right now, and I can't work from home forever.

John2010

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#748805 22-Jan-2013 14:05

I obviously don't know your specific circumstances, but this is how it commonly works.

Generally the fit-out items in office space (partitions, carpet, etc) are owned by the leasee, and if pre-existing when the lease was entered into are bought by the new leasee, or come free from the previous. In which case insurance and maintenance of those items is your responsibility.

Note that being your responsibility does not preclude you trying to claim off those who you may consider are responsible for damage, and if that be your landlord then most tenants would take into account how they want to manage that relationship (aggressively, or give and take) before claiming.

However, as has been said, you need to check your lease and any other documentation which may have effect as to the ownership of the fit-out. If the landlord did the fit-out (or took over its ownership from a previous tenant) and leased the premises to you as specifically fitted out then they are his and his responsibility, but even if that is so the hint given by your landlord indicates what most tenants would do under the circumstances. Commercial tenants usually don't bicker over the small stuff, they just get on an do it.

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#748821 22-Jan-2013 14:19

If the damage to your carpet was caused by something that the landlord controls, he is responsible for fixing it.

If you had your own insurance, you could claim against yours and let them chase him for the money.

If not, find out who his insurer is and make a 3rd party claim directly to them.

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#748836 22-Jan-2013 14:44

It's all in the lease. If you paid a lawyer to study it before you signed it, put the matter to him/her to advise. If you didn't have a lawyer look over the lease before you signed you'll probably have to suck it all up. It's very expensive (and even more time consuming) to pursue this kind of stuff through the courts. I imagine you've got better things to do. Your landlord can just sit back and watch you knock yourself out.

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networkn

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#748890 22-Jan-2013 15:23

John2010: I obviously don't know your specific circumstances, but this is how it commonly works.

Generally the fit-out items in office space (partitions, carpet, etc) are owned by the leasee, and if pre-existing when the lease was entered into are bought by the new leasee, or come free from the previous. In which case insurance and maintenance of those items is your responsibility.

Note that being your responsibility does not preclude you trying to claim off those who you may consider are responsible for damage, and if that be your landlord then most tenants would take into account how they want to manage that relationship (aggressively, or give and take) before claiming.

However, as has been said, you need to check your lease and any other documentation which may have effect as to the ownership of the fit-out. If the landlord did the fit-out (or took over its ownership from a previous tenant) and leased the premises to you as specifically fitted out then they are his and his responsibility, but even if that is so the hint given by your landlord indicates what most tenants would do under the circumstances. Commercial tenants usually don't bicker over the small stuff, they just get on an do it.

I am not sure how contractually they can say that a leak previously reported by us, which remains unresolved, which has for the third time impacted us, can be our responsibility. I would understand if we directly or indirectly even, caused said leak, but this has come about due to a lack of maintenance and on principle it shouldn't be our responsibility. Also frustratingly, I did converse about the cleaning with the Landlord that cleaners would be required (Though I clearly didn't make it clear enough I expected him to deal with it as I felt that any reasonable person would draw that conclusion) to fix the mess.

Even if the Fitout was our responsibility (I took it as it was) should be my responsibility if the leak was caused outside our business.

It's not a big expense to resolve the leak tidy up, but that should mean the landlord should just "get on with it" too, surely.

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#748907 22-Jan-2013 15:33

sampler: Sounds like its time to move, At the moment there are loads of commercial buildings around that require good tenants.

You've never signed a commercial lease have you? It's not that simple.

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