Mar
31
I have have 3 years left on a 7 year lease for a retail space. Can they take my house if i default?
By
I had a 2 year lease with an option to extend 5 years. When the 2 years was up, 2 years ago, they didn’t have me sign to extend, they just told me it was ‘ok’ and that they’d let me out of my lease if things went bad. Things went bad, and now they won’t let me out. So this question has 2 parts….
1. I didn’t sign to extend the lease, they said it wasn’t needed…. what’s the deal with that? Am i obligated for the next 3 years still?
2. If I AM obligated, and i default, can they put a lean or ‘take’ the house i own(well, the bank owns most of it…hehe)? Even if i declare bankruptcy?
Thanks for the help.
It’s in California.
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4 Comments
March 31st, 2010 at 2:45 pm
Read your lease agreement, everything should be there. Hire a lawyer. Without the details, it’s kind of hard to help, you could have signed a contract that said ANYTHING so without that information any answers you get here are useless.
Furthermore, laws regarding these types of leasing agreements vary by State and Municipality, so without THAT information any replies here are meaningless.
April 3rd, 2010 at 2:59 am
no, but they can slap a judgment against it and when you sell, you pay up.
However, if they re-rent in the meantime, all the rentals go to the lease.
April 3rd, 2010 at 12:59 pm
Is your business incorporated? Your name alone? or you and your spouse?
Is there a clause in the lease that you did not pay attention to concerning extentions/automatic extensions?
Is your spouse’s name on the house?
Is the spouse’s name on the lease?
You need a lawyer!!
April 5th, 2010 at 8:40 am
Most likely your lease has an auto-renewal clause in it and has the same powers and agreement set forth in the original 2 years for an additional term of to or for 5 years.
you do not say if you personally are responsible for the lease or it is leased to your company as an LLC.
If you are as an individual and/or a DBA yes they can proceed to a civil action and probably be awarded judgment for the time period the space remains unoccupied. But they must make efforts to obtain a tenant upon you vacating the space.
Your best option is to explain the situation to them and assist in obtaining a new tenant.
As to filing for b/k… yes it would halt any attempts they have to collect but may not be your best options or may be… only a bankruptcy attorney can review your position and best advise you on that course of action.