How to get out of a commercial lease due to repeated loss of power?

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How to get out of a commercial lease due to repeated loss of power?

My company is currently in a big office building. The building is very old and often loses power to our office during peak business hours considerably diminishing productivity. Is there any way we can get out of our lease based on this?

Asked on February 15, 2012 under Real Estate Law, Arkansas

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

There is something called the "implied warranty of habitability," which provides that a rental premises must be fit for its intended purpose. Conditions which render it unfit can provide a basis for the tenant to get compensation (basically, a rent abatement or rebate which reflects the difference between what the tenant is paying and what the tenant should reasonably pay for the impaired premises). It can also provide a basis for terminating a lease, but only if the condition is so severe as to not merely impair the leasehold, but it truly render it almost entirely unfit for its purpose. (The landlord must also have been given proper written notice of the condition and a chance to fix it first.)

The question is therefore very fact specific--losing power for 2 - 4 hours out of an average 40 hour workweek would almost certainly not justify termination, though it would likely support compensation; losing power for a day at a time regularly might allow termination. In between those extremes, there is some level that would, depending on the facts, support terminating the lease.

You should consult with an employment law attorney and discuss the matter in depth with him or her. Probably, the best route to take is to simultaneously seek monetary compensation and a declaration from the court that the lease and implied warranty of habitability were materially breached, allowing you to terminate the lease (and, in the alternative, if that  is not granted, seeking a court order requiring the electrical system to be repaired). That way, even if the court concludes it's not bad enough to terminate the lease, you have a good chance of getting money and getting the problem fixed.


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