Full question:
I bought a business 5 years ago and agreed to rent the building for 7 years and then I would buy the building. However, the owners decided to sell early. A new owner came in and nothing ha changed. We have not signed a new lease or anything. Am I obligated to stay in this building and fulfill my original lease or can I leave?
- Category: Landlord Tenant
- Subcategory: Lease Termination
- Date:
- State: Montana
Answer:
A lease is a contract between the landlord and tenant. The lease generally may not be terminated solely upon the sale of the premises unless the lease so provides. Generally, when a new landlord enters, the lease is assigned to the new owner, and they are bound by the terms of the lease already in existence.
In some cases, a landlord may negotiate with the tenants for an early termination when the new owner doesn't wish the tenants to remain. The tenants will typically want to receive some form of compensation for the early termination.
I suggest you read the lease terms carefully to determine the rights and obligations of the tenants, as well as those of the landlord upon sale or transfer of the property. Generally, when a lease is signed, the terms of the lease will govern early termination of the lease. If the lease terms don't allow for early termination, the tenant may be held liable for the remainder of the lease, unless the tenant can prove a breach of the lease terms by the landlord. However, the landlord has a duty to mitigate (lessen) damages by making reasonable attempts to relet the premises. This generally means that the landlord must advertise the premises and make attempts to show the premises to prospective tenants. It will be a matter of subjective determination for the court, based on all the facts and circumstances involved, whether reasonable attempts have been made to relet the premises. Some of the factors that may be considered, among others, include the reasons for turning down the prospective tenants and whether the landlord is in fact out of town and unable to show the premises.
This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.
