Legal Question in Real Estate Law in California
Hold over vs Eviction
Company A was the lessee in a year to year lease with company B. A purchased a new building that was not ready before that year's lease with B was up. B extended the lease for 6 months, but due to construction and city delays beyond A's control the building was still not ready at the end of the extension. The lease contract has a hold over clause requiring an additional 20% above and beyond the regular payment. For the last three months A has paid the additional hold over money and B has cashed each check.
B just served A with a 30 day notice to quit and has threatened eviction if A does not sign another 1 yr. lease. It will be another two to three months before A's building is move in ready.
If A continues to pay the additional hold over money what are its options? How long can A expect to legally stay under the hold over clause if B continues to cash the checks. {A has offered to double the rent for the duration of its stay over but there is a small measure of bad blood between A & B.} How long does the eviction process take? A is a construction company that supports 15 - 20 families who would suffer greatly if A could not do business for two to three months.
5 Answers from Attorneys
Re: Hold over vs Eviction
With careful approach to the situation, you could stay in the leashold for 4 months.
Re: Hold over vs Eviction
It's impossible to say without reviewing the terms of the holdover clause.
Re: Hold over vs Eviction
You pose several questions:
1. If A continues to pay the additional hold over money what are its options? As long as the lease provides that a holdover tenant does not gain any further rights by payment of rent, and the landlord does not grant any further rights, then you can only stay as long as you are paying, and as long as the landlord decides that it wants you to remain as a holdover tenant. The mere payment of holdover rental monies, and the mere acceptance thereof by the landlord, is insufficient to create a tenancy longer than that stated in the lease.
2. How long can A expect to legally stay under the hold over clause if B continues to cash the checks. As long as the landlord will let you stay.
3. {A has offered to double the rent for the duration of its stay over but there is a small measure of bad blood between A & B.} This is not relevant.
4. How long does the eviction process take? It's fairly fast, generally start to finish within a month. However, a decent defense attorney might be able to drag it out for a few months, provided that you pay the rent money as it is accruing, and provided that a judge permits it. Do you really want an eviction on your record?
5. A is a construction company that supports 15 - 20 families who would suffer greatly if A could not do business for two to three months. This is not relevant.
Find yourself a decent attorney familiar with the often complicated legal issues associated with unlawful detainers. We are litigators with extensive experience representing landlords and tenants in disputes such as these. Call or email if you would like a no charge consult.
Good luck.
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Re: Hold over vs Eviction
The notice to quit must state the grounds for which B is seeking eviction. Since B is cashing your checks, its accepting the holdover provisions of the lease and is not damaged. Additionally, your failure to sign a new lease does not damage B in any manner that I can see at this point, unless B is having trouble securing a new tenant because your tenancy is month to month with no end in sight.
The eviction process moves along fairly quickly for commercial tenancies, but you may also seek relief from the forfeiture of the lease so long as you are paying everything. Finally, you may oppose the payment of attorney fees that the lease most likely provides to the prevailing party, because it is arguable that the action is without merit.
B may be bluffing, and you can call his bluff, but if he sues, you should hire an attorney to defend the action and put B to work to support his claim of damages. If you've only got two or three months to go before your building is move-in ready, you may be able to stall enough. Good luck.
Re: Hold over vs Eviction
I'd agree with Mr. Guerrini's analysis. There is one other option to mention. Do you have a claim for damages against the builder of the delayed building? As a contractor yourself, you probably know that construction contracts can be written to place liability on the contractor for excessive delays, including liability for consequential damages.
If so, consider going ahead and signing a lease with B for a one-year extension, then adding a claim for the excess rent to a damages suit against your builder.
Again, this is not necessarily a recommendation, it's merely another option to consider.
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