Attorney Tim Mortimer discusses timing of “force majeure”
We learned in 2020 that landlords and tenants alike have been ambushed by unforeseen circumstances. With the business closed, commercial tenants were unable to pay the rent. Without the monthly rental payments, landlords were unable to pay off their mortgage loan. In some cases, landlords have been willing to work with tenants because doing so has been more beneficial than trying to find a new tenant during the pandemic. But in many other cases, companies closed their doors for good and commercial tenants simply abandoned the leases. Many companies, especially small businesses, have leases that are personally guaranteed by their business owners. While the owners may feel some relief from this, a personal guarantee is still valid only if the guarantor has the resources to support the guarantee. Unfortunately, most personal guarantors of a commercial lease derive all of their resources from businesses that have just closed, and also face individual bankruptcy.
The most common commercial lease negotiations I’ve seen this year are negotiations about ‘Coercive force Items that specifically include epidemics. The bargaining power of the parties is often the deciding factor in whether this is so Force Majeure The provision is included in the lease or other type of contract. Not everyone can anticipate every kind of circumstance that could cause business disruption. But in 2021 and beyond, trying to guard against the unexpected will be on everyone’s mind.
Read more information about Force Majeure as it applies to contracts and leases by clicking Here.
L4SB Offers flat fees Force Majeure Review. For $ 149.99, we will review your contract and consult with you to let you know your options. Call us today at 1-888-992-4952 or call us Online and let us help you renegotiate your contracts and agreements.
author: Tim Mortimer
Tim Mortimer is a business attorney for over 24 years, helping companies both small and large with mergers, mergers, sells and dispute resolution. He is licensed to practice law in the states of New Mexico and Arizona