Legal Question in Real Estate Law in California

I have an office in the San Francisco Bay Area. The lease has the possibility for an increase based on the CPI. The building manager just billed me for increases from 1/1/11. Is this legal?


Asked on 7/27/12, 12:05 pm

2 Answers from Attorneys

Depends entirely on the specific terms of your lease agreement.

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Answered on 7/27/12, 12:50 pm
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Most commercial leases have very detailed provisions covering how index-based rent increases are determined, calculated, applied and paid. Sometimes they even contain examples of how the rent increase is calculated for a hypothetical increase in the relevant index. You should go back and verify that the increases were properly calculated and that they should start with the beginning of 2011. However, if your question relates to the landlord taking an excessive period of time before billing you -- he may have waited up to 18 months before adding the increases -- I think the landlord is within his rights to go after you for the correct rent. Billing mistakes that could have been caught by either party early-on can usually be corrected by either party at a later date, and the proper charges per the agreement remain due and payable. This would work in your favor if the landlord had overbilled and you had overpaid. Here, it works in the landlord's favor. In order for a party to be barred from correcting his billing or payment error, two things must be true: (1) there must be a mutual mistake that the benefitted party did not and should not have noticed at the time of the mistake, and (2) the benefitted party must have irrevocably altered his financial position in reliance on his mistake, e.g., spent the money elsewhere and can't get it back.

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Answered on 7/27/12, 4:52 pm


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