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Legal Eagle Esq.
Legal Eagle Esq., Attorney
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I sold my business on contract. The persons I sold the ...

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I sold my business on contract. The persons I sold the business to pay rent to the same landlord that I paid rent too. Seven months later the landlord contacts me that I owe him for some tax bills and some rent payments I missed when I had a long illness. My question is in the state of Illinois what is the proper legal form I could download off the internet that could be used for the persons buyin my business to deduct an amount from what they pay me and send it to the landlord when they send in their rent payment?
Submitted: 6 years ago.
Category: Business Law
Expert:  Legal Eagle Esq. replied 6 years ago.
Unfortunately, there is no one perfect document for what you are asking. I have provided a possible course of event for you further down in this response but just wanted to ask you to consider the following-

Things to Consider-

Why would you want the Contract Business Buyer to make the payment on your behalf? Why not receive the payments from your Contract Business Buyer and then make the payment to the Landlord yourself? While it may seem simple enough that your Contract Business Buyer would make the payment to the Landlord- this could backfire on you. What if your Contract Business Buyer fails to make the payments to the Landlord and you don't find out until months later? It seems preferable to receive payment directly from your Contract Buyer and then make the payment for your debts to the Landlord direct from your checkbook to the Landlord.

PROPOSED SOLUTION-

First:

Has the landlord agreed to be paid over a period of time? If so then you should memorialize the agreement with the Landlord and include a few important clauses (but in no event comprehensive but just enough to get you going and as you write it then you will begin to understand what else you might need): 1) the Parties to the agreement; 2) a short recitation of the reason for the payments (i.e. a short and concise summary of the circumstance); 3) the amount of repayment; 4) the period of time for repayment (i.e. 12 equal payment of $x,xxx/month); 5) Interest (if any for the unpaid sum; 6) clause indicating that payments to be made by current tenant (the "Contract Business Buyer") on your behalf and at your direction; 7) How payments should be allocated in the event that the Contract Business Buyer fails to make a payment sufficient to cover the business owner's rent and your repayment sum; and 8) timely notification by landlord to you in the event that Contract Business Buyer fails to make a satisfactory payment.

The landlord may want to revise your initial draft to include: 1) interest on unpaid sums; 2) include language to insure that the obligation is yours in the event that the new business owner fails to make the appropriate payment to him and that landlord will have recourse to seek payment from you; and/or 3) otherwise request particular issues of importance to him/her.

Second-

Instruct the Contract Business Buyer to diminish the payment made directly to you by the amount of the agreed upon sum that you have agreed to pay the landlord to cover your underpayment during the period you were ill.
Customer: replied 6 years ago.
Reply to M.A. Torres's Post: The answer to my question was not as helpful as I had hoped for, so I will propose a more valuable question.I lease business property that I in turn sublease to another business;we shall call business XYZ I am business ABC.
The landlord is taking me to court with a forceible entry and detainer to collect on some unpaid rent and tax bills that were missed in the prior two years before the current lease was signed. Under the current lease the subleaser; business XYZ, has paid rent on time. I imamagine the court will have me fill out papers for a repayment plan to the landlord. The landlord may want to negate the lease that he has with me, business ABC, and sign a seperate lease with business XYZ. Now here is the important question? Business Xyz has a seperate contract with me, outside of the lease agreement to rent space to me, business ABC. As long as the landlord is being paid his current rent and is being repaid what I owe him can the landlord keep me off the premisis or keep business XYZ from renting space to me Business ABC to conduct my own seperate business activities.
This is in the state of Illinois
This is a 30.00 question.
Expert:  Legal Eagle Esq. replied 6 years ago.
HelloCustomerbr />
Business XYZ may sublease space to you so long as the lease arrangement between XYZ and landlord does not have a clause against subleasing. Sublease clauses come in various forms:

Example Sublease Provision:

1) The tenant will not sublease the premises, in whole or in part, without the prior written consent of the landlord.
- this type of clause requires consent from the landlord and typically consent can't be unreasonably withheld

2)
The tenant will not sublease the premises, in whole or in part, without the prior written consent of the landlord, which consent may be withheld at the sole and absolute discretion of the landlord.
- this type of clause requires consent but it can be withheld at the landlords sole discretion.

3)
The tenant will not sublease the premises, in whole or in part.
- This is an absolute preclusion against subleasing. The only way around this would be to approach the landlord to amend this clause by an amended and restated lease or an amendment to the lease rephrasing the clause.

4)
The tenant may sublease the premises, in whole or in part, upon notice to landlord of said sublease.
- As it states, the tenant may sublease upon notice being provided to landlord.

5)
The tenant may sublease the premises in whole or in part.

As you can see the sublease clause comes in as many forms as can be agreed upon between the tenants and landlord (above are only a few examples).

Hope this has been helpful!
Customer: replied 6 years ago.
Rseply was understandable; but one more question. Should business XYZ sign a lease that will not allow them to rent space to me, business ABC.
Has not business XYZ broken their original contrct with ABC. ABC sold their business to XYZ with a clause in the contract that they would provide space for me, business ABC. and would not both business XYZ and the landlord be trying to prevent me from earning and income as I was expecting too. See my original question dated around 5/13/08 that you responed to about busnees XYZ remodeling to code this area for me, business ABC.
Expert:  Legal Eagle Esq. replied 6 years ago.
HelloCustomer

I did not respond to any question of your on 5/13/08 (I was not affiliated with JA back then).

IF XYZ entered into an agreement with ABC whereby XYZ agreed to provide ABC with a subtenancy in the landlords building then arguably XYZ shouldn't enter into a lease with landlord that would preclude XYZ from fulfilling its obligations to ABC; I say arguably because even if XYZ enters into an agreement with landlord for space with a clause precluding a sublease to ABC, at that moment in time XYZ has not breached the agreement with ABC until such time as ABC demands performance under the agreement between ABC and XYZ AND XYZ denies ABC the space (XYZ may choose to breach its agreement with landlord and fulfill its obligations to XYZ) alternatively XYZ may enter into yet another lease with landlord that will provide XYZ with the opportunity to lease space to ABC. Keep in mind that if the agreement between ABC and XYZ does not indicate that the space must be provided in the building in question then XYZ could substitute space at another location to satisfy its obligations to ABC.

As I see it XYZ may have an obligation to ABC to provide space to conduct his business and do with the space as ABC wishes pursuant to the sublease between XYZ as sublandlord and ABC as sub-tenant.

To the extent that you can prove damages for expected earning then you might have a case (if this were to be a new business by ABC then this might be difficult since the probability of failure is high for new businesses and the resulting income is highly speculative).

As for the landlord- the landlord has no obligation to provide ABC with an opportunity to earn an income on his property - perhaps, if there is a cause of action for intentional interference with a valid business contract (i.e. if landlord does enter into the lease with xyz and does not preclude subleasing to anyone except ABC), then you could attempt to make that case but landlord would be well served to avoid putting a clause in his lease stating "No subleasing to ABC" and instead use "no subleasing".
Legal Eagle Esq., Attorney
Category: Business Law
Satisfied Customers: 70
Experience: Business / Corporate / Real Estate
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