Critical lease clauses for commercial properties during and post COVID-19 era :: Mmegi Online

The contracting parties should not fall into the trap of presuming that any Force Majeure (FM) provisions are implied in the lease. For this reason the clause on FM should explicitly state what would constitute a FM event and go a step further to cover the rights and responsibilities of each party whenever a FM event is declared. Quite important here would be provisions for serving notice to either party, and strict adherence to these should not be viewed as optional. The language of the lease should be couched in such a way that it does not provide room for ambiguity that could easily lend itself to one of the parties unduly exploiting the other. There are three essential factors here; content, context and intent. PAUL BATSHEDI MORE writes

While scientists, epidemiologists and vaccinologists are toiling day and night around the globe, working their fingers to the bone for the benefit of humankind, the world has to keep moving. Almost everyone says that life will never be the same again post coronavirus (COVID-19) era. A disruption of an unforeseen magnitude has hit a good number of industries. Perhaps the hardest hit are; entertainment, finance, health, travel, transportation, petroleum, tourism, catering, retail and fine wine and dining.

Also hit, and badly so, is the real estate industry. Both lessors and lessees are bleeding money. The question is, how could each party meaningfully protect its interests going forward? This article suggests a restructuring of existing commercial leases to include clauses that would reasonably accommodate interests of both parties with a view to averting conflict and possible litigation.

Already have an active account? Log in here.

Or Sign up and get unlimited access to premium articles.