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Chris The Lawyer
Chris The Lawyer, Lawyer
Category: New Zealand Law
Satisfied Customers: 14194
Experience:  37 years qualified as a lawyer; LLB, MMgt and FAMINZ.
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Does a failure to comply with a requirement of a Building Lease

Customer Question

Does a failure to comply with a requirement of a Building Lease contract by one party automatically enable the other party to the same contract exercise a similar rite? Evan
Submitted: 1 year ago.
Category: New Zealand Law
Expert:  Chris The Lawyer replied 1 year ago.
No. A breach of the lease, which a failure to comply is in reality, does not entitle the other party to also breach the lease. Of course the issue is what did one party fail to comply with?
Expert:  Chris The Lawyer replied 1 year ago.
It would help me answer better if you advised what the requirement was.
Customer: replied 1 year ago.
There is a specific requirement in the lease for both parties to pay into a an account equal sums monthly. One party does not believe he has to (the property owner) while the other party has religiously complied
Expert:  Chris The Lawyer replied 1 year ago.
What is the account for? If the lease says you must, then this is a breach of the lease.
Customer: replied 1 year ago.
Yes I agree but if I initiate proceedings it is going to cost me a lot of money. I was hoping some dispensation would be grant me if I were taken to court and explained my frustration and the unfareness of the owners action in thisw case - the account is for a building maintenance expenses
Expert:  Chris The Lawyer replied 1 year ago.
You could tell the landlord that you intend deducting from your rent, what he should be paying for the expense, and paying this into the account.
Customer: replied 1 year ago.
The total sum owed the account by the Landlord is in the order of $70k to date. Am I restricted in any way as to the amount I can deduct from Lease payments? Payments according to the lease are required monthly
Expert:  Chris The Lawyer replied 1 year ago.
That could lead to a confrontation of course. Is this a large commercial landlord or a difficult individual?
Customer: replied 1 year ago.
A very difficult individual
Expert:  Chris The Lawyer replied 1 year ago.
Has he given any reason why he is choosing not to make the payments?Usually the landlord drafts the lease, so it would have come from him and his lawyer.
Customer: replied 1 year ago.
He alleges the previous tenant knew he didn't pay and that he believed I had been told of this by that tenant. Such a claim I will refute, what is more, there is no amendment to the reassigned lease agreement
Expert:  Chris The Lawyer replied 1 year ago.
Unless the requirement was deleted, he is stuck with this. So since he wont comply perhaps my suggestion of deducting the payments going forward will bring this to a head.
Customer: replied 1 year ago.
The lump sum or a reasonable proportion of it monthly, or just the amount stipulated within the Lease $500/month?
Expert:  Chris The Lawyer replied 1 year ago.
Perhaps start with the amount of $500 and see what this provokes
Expert:  Chris The Lawyer replied 1 year ago.
Is the money in the account under joint control? Is it actually used for maintenance?
Expert:  Chris The Lawyer replied 1 year ago.
I mention that as that would ensure the money is safe
Customer: replied 1 year ago.
Yes it is and they to date have not attempted to draw on it for their use.
I have to seek approval from them to release funds for maintenance we have undertaken which to be fair has not been an issue but it seems to me that they are claiming what they have spent independently to comply with their obligations as specified in another part of the lease document is their compliance with the requirement to the maintenance fund
Expert:  Chris The Lawyer replied 1 year ago.
That is not strict compliance, but arguable on their part. So as I suggested going forward, if you start the payments of their share deducted from rent, this could bring this to a head
Customer: replied 1 year ago.
Thanks Chris, I think that gives us some hope. I realize we are advised via your service to seek confirmation for the advice from our own Solicitor to verify our course of action which we have already done and was advised it could cost us upwards of $20k + if we initiated proceedingsThank you for your adviceEvan
Expert:  Chris The Lawyer replied 1 year ago.
The key is to make the landlord do the work. He would find it hard to challenge the payment into the maintenance account if he was not doing so pursuant to the lease.
Customer: replied 1 year ago.
Many thanks
Expert:  Chris The Lawyer replied 1 year ago.
I hope this works out with your difficult landlord

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