Leasing, it’s easy, just get the dollars and the term of the lease right and that’s the end of it, nothing more to do, right?

A lease document in fact is a very involved, very detailed contract that sets the terms and conditions in which a tenant (or subtenant or new business owner as assignee, but they’re all different topics al on their own) gains the right to occupy someone else’s property and pay rent and sometimes an array of other monies for the privilege to do so.

There are many issues that arise in leasing, way too many for an article like this, so let’s just concentrate on one, the use of the premises

First things first; the use has to be defined properly in the lease. Using some vague terms, or using a short form of words might end up causing more problems than it ever should.

The tenant has to be aware of what exactly he wants to do in the premises. That’s a perfectly obvious statement, but it’s something that often is overlooked. If you sign up a lease and then realise that in fact your plans for the premises involve several activities that you have NOT DESCRIBED in the permitted use, you are then faced with the problem that you may not be allowed to do what it is that you want because either the landlord declines to consent to the amendment in the use, OR it is not allowed by the local government planning scheme that governs the premises.

You must obtain the consent of the landlord to changing the use in the lease and there’s no guarantee that that consent will be given, or given without the landlord charging you for the ‘time and trouble’ it takes to gain their consent.

Then you must take steps to learn whether the use is permitted by the Local Council. If you leave that until after you sign the lease, you may find out that the use is NOT permitted under the planning scheme and you are obliged to make a Planning Application seeking variation to the scheme to allow the use in the premises. That application is expensive and non-refundable, and there are no guarantees whatever that the Council will approve the variation to the planning scheme. Without the planning permission in place the Council can literally shut the business down. All of that resolvable by a phone call to Council BEFORE you sign anything. And that’s just one little element of a lease that needs to be dealt with before signing the lease.

There are a huge number of issues that arise for consideration in each lease. Contact one of our commercial solicitors whenever you are contemplating a lease of any sort-and we haven’t even touched on the various types of lease, Retail, Commercial, and Industrial, all with their own niceties of language and liabilities and disclosure requirements- to get help through the minefield.

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This article is for your information and interest only. It is not intended to be comprehensive, and it does not constitute and must not be relied on as legal advice. You must seek specific advice tailored to your circumstances.