Call All Tenant Payments 'Rent' or 'Additional Rent'
Commercial property owners should ensure that their leases describe all tenant payments and charges as either “rent” or “additional rent.” While it might seem like a legal technicality, using these terms ensures you access to fast-track eviction if the tenant later defaults on its obligation to pay operating expenses, taxes, trash removal, parking fees, and other leasing costs.
Explanation: Most states have special eviction procedures designed to resolve landlord-tenant disputes quickly and cheaply. You can take advantage of these expedited procedures to recover tenant nonpayment, provided that the nonpayment involves rent. Nonpayment of things other than rent need to go through the normal litigation process.
There’s a lot of money at stake. That’s because many of the payments tenants are expected to make under a lease aren’t normally considered rent. The good news is that if the lease expressly provides that such payments constitute rent or additional rent, courts will normally honor the parties’ intentions and allow for enforcement via the expedited eviction procedures. And that can save you not just time but thousands of dollars in legal fees.