Common Commercial Property Disputes and How to Resolve Them

Owning, leasing, or managing commercial property often involves navigating disputes. Whether you’re a landlord, tenant, developer, or investor, disagreements can arise from contract misunderstandings, unexpected changes in regulations, or differing expectations. Understanding the most common types of commercial property disputes and how to resolve them efficiently can save you time, money, and unnecessary legal complications. In this post, we’ll dive into the typical conflicts property owners and tenants face.

1. Lease Disputes

Lease disputes are among the most frequently encountered issues in commercial property. These conflicts often stem from disagreements over rent payments, maintenance responsibilities, and lease renewal terms.

Common Causes:

• Late or missed rent payments.
• Disagreements over renewal terms
• Confusion over maintenance obligations
• Unauthorized subleasing
• Violation of lease terms

How to Resolve:

• Drafting a Clear Lease Agreement: Ensure your lease outlines all terms and expectations for both parties as clearly as possible.
• Mediation: Mediation can provide a less hostile environment for resolving disagreements before they escalate.
• Legal Action or Arbitration: If other options fail, arbitration or litigation may be necessary to enforce the lease terms.
• Maintain Open Communication: Regular discussions with tenants or landlords can resolve minor issues before they become major disputes. Building a working relationship is often the key.

2. Property Boundary and Easement Disputes

Boundary and easement disputes occur when property owners disagree on property lines or the right to use someone else’s land.

Common Causes:

• Unclear property deeds or surveys
• Encroachment from buildings or fences
• Conflicts over access rights (easements)

How to Resolve:

• Professional Land Survey: Hiring a land surveyor helps clarify exact boundaries.
• Negotiation: Where possible, try to negotiate directly with the other party to reach a solution.
• Legal Action: If an agreement can’t be reached, the court may step in to settle the boundary or easement dispute.

3.  Rent and Service Charge Disputes

Disagreements about rent increases or service charges for property maintenance and shared facilities are common between tenants and landlords.

Common Causes:

• Disputes over rent review clauses in leases
• Unjustified rent increases
• Excessive or unfair service charges

How to Resolve:

• Clear Lease Clauses: Ensure that rent review clauses are clearly defined and mutually agreed upon.
• Independent Property Valuation: A third-party valuation can help settle disagreements over rental values.
• Alternative Dispute Resolution (ADR): Mediation or arbitration can be effective in resolving rent-related disputes without resorting to costly litigation.

4.  Repair and Maintenance Disputes

Disputes often arise regarding who is responsible for repairs and maintenance, particularly in commercial properties where upkeep is crucial for business operations.

Common Causes:

• Unclear maintenance responsibilities in the lease
• Delayed or ignored repair requests
• Structural damage or safety violations

How to Resolve:

• Specify Responsibilities in the Lease: Clearly define the responsibilities of both parties for repairs and maintenance.
• Regular Property Inspections: Scheduling routine inspections can help identify problems early on and prevent larger disputes.
• Legal Recourse: If a landlord refuses to make necessary repairs, tenants may have legal options to enforce the contract.

5.  Land Use Disputes

Commercial property owners often face conflicts related to land use regulations, and planning permissions.

Common Causes:

• Changes in User classes that can affect property use
• Unauthorised modifications to land or buildings
• Disagreements over planning permissions

How to Resolve:

• Stay Informed About Use Classes: Property owners should be aware of what Use is granted to the Lease and property.
• Consult Local Authorities: Getting approval before making significant changes to property can prevent future legal challenges. But be aware of what restrictions are placed in the Lease to obtain planning permission.

6.  Eviction and Tenant Removal Disputes

Evictions often lead to disputes when tenants resist leaving the property or challenge the eviction process itself.

Common Causes:

• Non-payment of rent
• Violation of lease terms or property rules
• Illegal activity taking place on the premises.

How to Resolve:

• Proper Legal Notices: Ensure that all eviction notices and actions comply with Lease and Legal requirements.
• Court Orders: If tenants refuse to vacate voluntarily, a formal court order may be necessary.
• Negotiated Settlement: In some cases, offering a financial incentive to vacate may be a viable solution to avoid lengthy legal proceedings.

7.  Construction and Development Disputes

Disputes in construction or property development often arise between developers, contractors, and regulatory bodies.

Common Causes:

• Breach of contract by contractors
• Delays in construction or cost overruns
• Disagreements over the quality of work or materials

How to Resolve:

• Detailed Contracts: A well-drafted contract that specifies project timelines, deliverables, and quality standards helps avoid disputes.
• Ongoing Project Management: Regular monitoring of the construction process ensures work stays on schedule and within budget.
• Dispute Resolution Clauses: Including mediation or arbitration clauses in contracts can provide a structured way to resolve conflicts if they arise.

Conclusion

While commercial property disputes are sometimes inevitable, understanding the common issues and knowing how to address them can minimise the impact. Whether it’s through negotiation, mediation, or legal action, having clear agreements and open communication can go a long way in maintaining healthy business relationships and protecting your property interests. By proactively addressing potential conflicts, you can keep your commercial property investments on track and avoid costly legal battles. We are here to assist at all levels of this communication and to explain to you the steps you may need to take.

If you would like any more information relating to this article please contact Gavin Lampert on 020 8221 8062 or at gavin.lampert@bowlinglaw.co.uk

This article is not intended to provide legal advice; it is intended to provide information of general interest about current legal issues.