10 Common Commercial Lease Disputes and How to Resolve Them

Commercial lease agreements are essential for both landlords and tenants, but they can also become a source of friction when disagreements arise. Whether you're a business owner renting office space or a landlord managing multiple units, understanding common commercial lease disputes and how to resolve them effectively can save time, money, and stress.

Don't let lease disputes disrupt your business. Learn about 10 common commercial lease disputes and how to resolve them legally and efficiently.

If facing a commercial lease dispute, call our experienced commercial lease solicitors in London today on 0203 417 3700 for clear legal guidance.

Table of Contents

What Is a Commercial Lease Dispute?

A commercial lease dispute arises when either the landlord or the tenant believes that the other party has breached the terms of the lease agreement. These disagreements can relate to rent, repairs, service charges, lease termination, and more. If not addressed quickly, they can lead to costly legal action or even eviction.

Ten Common Types of Commercial Lease Disputes

1. Rent Arrears and Late Payments

This is one of the most frequent issues faced by commercial landlords. If a tenant falls behind on rent payments, it can disrupt the landlord's cash flow.

How to resolve: Open communication is key. Landlords can offer payment plans or consider mediation before resorting to court action.

2. Disputes Over Service Charges

Tenants often dispute the amount or breakdown of service charges. Some feel they are being charged for services they don't benefit from.

How to resolve: Ensure transparency. Lease agreements should include a clear clause on how service charges are calculated. A commercial lease solicitor can help review or renegotiate these terms.

3. Dilapidations (Repair Obligations)

At the end of a commercial lease, landlords may claim the property is in disrepair and seek compensation. Tenants may argue they've maintained the property as agreed.

How to resolve: Obtain a schedule of condition before signing the commercial lease. At the end, both parties should involve a surveyor to assess the state of the property objectively.

4. Break Clause Disputes

Break clauses allow either party to end the lease early under specific conditions. Disputes arise if a tenant tries to exit early but the landlord claims they haven't met all the requirements.

How to resolve: Carefully follow the notice period and all conditions outlined in the lease. Seeking advice from a commercial lease solicitor is highly recommended when invoking a break clause.

5. Rent Review Disputes

Commercial leases often include rent review clauses. Disputes arise when landlords want to increase the rent, and tenants disagree with the new valuation.

How to resolve: If negotiations break down, appointing an independent third-party surveyor can help determine a fair market rent.

6. Assignment and Subletting Issues

Tenants may want to assign or sublet their lease but find their landlord uncooperative.

How to resolve: Review the commercial lease terms beforehand. Most leases require the landlord's written consent, which cannot be unreasonably withheld. If disputes arise, legal intervention might be necessary.

7. Alterations Without Consent

A tenant might make changes to the property without seeking the landlord's approval, violating the lease terms.

How to resolve: Commercial lease agreements should clearly state what modifications are allowed. Legal advice can help resolve whether consent was needed or wrongly refused.

8. Breach of Permitted Use Clause

This happens when tenants use the premises for activities outside the agreed purpose, such as turning a retail space into a café without permission.

How to resolve: Always ensure you have permission in writing before changing how the property is used. If you're unsure, consult with a solicitor specialising in commercial lease agreements.

9. Failure to Vacate After Lease Expiry

Some tenants may overstay their lease, disrupting new arrangements made by the landlord.

How to resolve: A formal notice can be issued, and legal proceedings may follow. Early discussion and agreement on vacating dates can help avoid this.

10. Forfeiture and Eviction

Landlords may seek to end the lease due to serious breaches. Tenants may contest this or apply for relief.

How to resolve: It's essential to act quickly. Solicitors can help tenants apply for relief from forfeiture or negotiate a settlement.

How to Resolve Commercial Lease Disputes

Disagreements over a commercial lease can be stressful, especially when your business premises are involved. Whether you're a landlord or a tenant, it's important to know how to handle disputes calmly, legally, and efficiently. Below is a step-by-step guide to resolving commercial lease disputes.

Step 1: Understand the Root of the Dispute

The first step is to figure out what exactly has gone wrong. Common issues include:

• Late or unpaid rent
• Arguments over repairs or maintenance
• Disagreements about service charges
• Problems with ending the lease early

Take time to review your lease agreement carefully, it often holds the key to settling the matter.

Step 2: Talk It Through Early

Don't let things fester. A quick phone call, meeting, or polite email can often clear up misunderstandings before they turn into legal headaches. Whether you're a landlord or a tenant, being open and professional in your communication can go a long way.

Tip: Always keep a written record of what's been discussed, just in case things need to be referred back to later.

Step 3: Check Your Lease Terms

Most commercial lease agreements are detailed and legally binding. Go back and check:

• What responsibilities did both parties agree to
• Whether certain actions (like rent increases or early termination) are allowed
• The process for raising or resolving complaints

You may find that the lease itself contains steps for resolving disputes, such as giving formal notice or using a third-party surveyor.

Step 4: Try Negotiation or Mediation

If informal talks don't work, try formal negotiation or mediation. This involves a neutral third party (a mediator) helping both sides reach a fair agreement without going to court.

Mediation is usually quicker, less expensive, and less stressful than legal proceedings, and it often leads to practical outcomes that work for everyone.

Step 5: Get Legal Advice from a Commercial Lease Solicitor

If things are getting complicated or if your rights are being ignored, it's time to get expert help.

A qualified commercial lease solicitor can:

• Explain your legal position clearly
• Help you enforce or challenge lease terms
• Communicate with the other party on your behalf
• Represent you in negotiations or court (if necessary)

Getting legal support early can often prevent a small issue from becoming a major one.

Step 6: Use Arbitration or Take Legal Action (If Needed)

As a last resort, you may need to involve the courts or an arbitrator to get the issue resolved. This is more formal and can take time, but sometimes it's the only way to protect your rights, especially in serious cases like eviction, unpaid rent, or breach of lease.

Reminder: Most courts will expect you to try negotiation or mediation before taking legal action.

Final Thoughts

Commercial lease disputes are never ideal, but they can often be resolved with good communication, a calm approach, and the right advice. Whether you're a landlord trying to enforce lease terms or a tenant facing unfair charges, our expert commercial lease solicitors are here to help.

How a Commercial Lease Solicitor Can Help

Whether you're facing a dispute as a landlord or tenant, working with an experienced commercial lease solicitor can save you significant time and legal costs. A solicitor can:

• Review lease terms for clarity and compliance
• Offer strategic advice during rent reviews or break clause activations
• Represent you in mediation or court proceedings
• Help negotiate fair settlements to avoid lengthy litigation

If you're dealing with a commercial lease issue, it's wise to get tailored legal advice as early as possible.

Need help with a commercial lease dispute?

Our experienced team of commercial lease solicitors is here to help, whether it's a rent dispute, a break clause problem, or an end-of-lease disagreement. Let's resolve it the right way.

To resolve your lease dispute quickly and effectively, contact our commercial lease solicitors in London at 0203 417 3700 for expert legal advice.