Whether you’re a long-term Commercial Landlord or Tenant, it can become easy to forget that your relationship is formal and likely the rules of that relationship are in a very long lease document.
The Lease spells out who is responsible for which parts of the Premises are being leased and if there are areas shared by many Tenants, it spells out the common area responsibilities as well.
A recent decision of the Ontario Court of Appeal[1] reminded parties of the importance of having the Lease drafted in a way that accurately reflects your needs, not only at the time of signing, but moving forward into the future. The heart of the dispute in the recent case is whether the Landlord could reconfigure its’ parking lot in a way that moved 36 spots further away from a tenant that had a Lease which guaranteed 201 spots to a Tenant. The Tenant argued that by moving the spots further away, the Landlord was interfering with their rights under the Lease regarding their parking spots.
The Court of Appeal disagreed with the Application Judge and found that because they still had access to 204 parking spots, the Tenant’s rights under the Lease were not interfered with.
No one can predict the future with 100% accuracy, so when entering into long term leases, which usually contain renewal rights, it’s important when those renewals come up that you consult a lawyer and if needed, negotiate changes which become part of a Lease Renewal and Amending Agreement. Don’t do this alone, use a lawyer: you don’t want to end up in uncertain territory when you could have prevented it!
Inga B. Andriessen, Senior Lawyer
[1] Metro Ontario Real Estate v. Embee Properties, 2024 ONCA 51