Rental problems: a follow-up

Earlier in this section, attention has already been paid to the possibility for tenants of retail space in particular to hold the landlord liable under certain circumstances in the event, in short, the rented location does not deliver what could and could reasonably be expected of it. In practice, this problem often occurs in new or renovated shopping centres. The rental price of the units in those shopping centers is often geared to a certain flow of visitors with a correspondingly expected turnover. If that turnover falls short of expectations, this can create claims against the lessor under certain circumstances. However, this is not a run course. Practice has shown this once again very recently in a number of court rulings.

In short, it can be deduced from those judgments that, as so often in law, the final outcome of a conflict as described above depends primarily on the circumstances of the case. In particular, this refers to the question of whether and to what extent the landlord has actually raised expectations towards the tenant(s) with regard to the expected flows of visitors and the associated turnover. If a landlord is to be sued successfully, it must therefore be possible to demonstrate beyond doubt that the relevant landlord has actually presented such expectations to the tenant(s), preferably on the basis of reports and figures, and that those expectations have actually not been fulfilled. . Furthermore, it must be beyond dispute that the lessee concerned is not to blame. In short: the history that led to the conclusion of the lease is of eminent importance. The court makes a nuanced assessment in this regard.

It has also recently become apparent that the question of whether the tenant can be regarded as a professional tenant is also of great importance. For example, an individual entrepreneur who is confronted with this problem may receive a more favorable assessment than, for example, a franchisor who rents the space from the landlord and may or may not sublet it, because the latter must be regarded as a professional tenant. and, in the reasoning of the judge, should therefore have known better. A parallel with the prognostic problems in franchise relationships, which have already been discussed several times in this section, is urgent. The conclusion of this is that landlords would of course do well to make sure in advance whether a location to be let actually delivers what can be expected of it for tenants in relation to the rent level. Potential tenants, especially when they are professional parties, would do well to independently ascertain the same variables and, if in doubt, either negotiate a lower rent or look for another location. Complaining afterwards certainly does not lead to success in all cases.

Ludwig & Van Dam franchise attorneys, franchise legal advice