When a commercial tenant feels that it cannot timely pay its full rent obligation, this potentially creates issues for both the tenant and the landlord. A landlord can begin taking action or can allow the tenant to pay late and/or pay less than the full rent. Both landlords and tenants need to know that, when the latter happens, that step potentially triggers certain legal ramifications, such as the waiver of terms and/or the creation of a “quasi-new agreement.” As a Georgia commercial landlord, you should make sure you’re consulting with a knowledgeable Atlanta commercial leasing lawyer before you acquiesce to nonpayment, late payment, or partial payment of rent.
The Georgia Court of Appeals addressed that issue last year. In that circumstance, the contract was a commercial sublease agreement in Atlanta. The subtenants, two law firms, allegedly fell behind in paying rent, so the sublessor, an insurance company, eventually took them to court.
The sublessor won in the trial court. The trial judge granted summary judgment in its favor on its claims, as well as all of the subtenants’ counterclaims. The insurance company had a problem, though, and the subtenants used it to score a success in their appeal.