The Independent Counsel

Real Estate/Facilities


Reduce Your Maintenance Charges


BY WILLIAM F. SIGGART

Certain charges by your company's landlord for repair and maintenance to company premises may be avoided through careful analysis and application of the terms of your commercial lease.

One such cost saving is in the area of hot water maintenance. While a landlord may rely upon the general maintenance clause to charge the tenant for such costs, one might argue effectively that the landlord should pay for hot water repairs, basing one's argument upon the following lease terms:

  1. The definition of Leased Premises does not include hot water tanks;
  2. If hot water tanks fall under the Leased Premises definition, their failure constitutes reasonable wear and tear to be repaired by landlord;
  3. Hot water maintenance should instead fall within the lease's Common Area operating expenses, of which the tenant is responsible to pay only a percentage ("Rent Adjustment"); and/or
  4. The lease indemnification and liability clause requires tenant to pay for water damage only if not caused by the landlord's neglect, thereby implying that it is landlord's responsibility to maintain water pipes.*

© ASSOCIATION OF INDEPENDENT GENERAL COUNSEL 1994; (all rights reserved). This article is not intended as legal advice. Consult a qualified attorney for assistance concerning a specific issue or problem.