As a landlord, it is possible for a tenant to breach a commercial lease in a variety of ways. For instance, it can occur by the tenant failing to make rent payments or by failing to meet certain covenants contained in the lease. Ultimately, the lease will be the controlling document, and it will dictate both what can be a breach and how it may be remedied. With that being said, a landlord generally has three options under Florida law for when a tenant is in breach of the lease agreement or has terminated the lease early.
- First, a landlord has the option to end the rental agreement and retake possession for themselves, allowing them to use the premises as they please. This would terminate the liability of the tenant, meaning the landlord would be unable to collect any future rent.
- A landlord also has the option to retake possession of the premises on behalf of the tenant. If the landlord does this, they can hold the tenant liable for the remainder of the rent. This does, however, impose a duty upon the landlord to undertake reasonable efforts to relet the premises. Eventually, once the premises are relet, any future rent owed by the former tenant will be offset by the new rent payments the landlord is receiving.
- The landlord may also do nothing and hold the tenant liable for all rent as it comes due. If a Landlord elects to do nothing, it would be entitled to damages that remain on the lease as they come due.
One important consideration for landlords when a tenant breaches but remains on the premises is that self-help eviction is illegal in Florida. Thus, a landlord cannot take actions like changing the locks or cutting off utilities to prevent the tenant from entering the premises. If the tenant becomes a “holdover tenant” then proper eviction measures must be taken.
Another important consideration is that a lease may contain clauses that specify damages in circumstances when a tenant breaches the agreement, also called liquidated damages. Commercial leases may also state that accelerated rent, or all remaining rent, is due upon the tenant’s breach of the agreement. As mentioned earlier, if a lease contains one of these clauses or something similar, it will control the damages amount.
Altogether, as a landlord, it is important to make sure the lease agreement addresses both what amounts to a breach, and any potential remedies. Further, if a tenant has breached the lease agreement, a landlord must also assess their goals for the future of the premises, and the options provided herein in light of those goals. If you have any questions regarding your rights as a landlord or the terms of your commercial lease, please reach out to us for a free consultation.
