Landlord Response: Commercial Tenant Disputes

California Commercial Landlord Defense

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Evaluating Tenant's Claim
Commercial Lease Disputes: Tenants may dispute rent, CAM charges, repairs, or allege landlord breaches. Respond promptly with lease-based defense. Document everything and preserve your rights.
Common Tenant Claims Against Landlords
  • CAM Overcharges: Tenant claims inflated or improper CAM charges; demands audit; requests refund
  • Failure to Repair: Tenant claims landlord breached lease by failing to maintain common areas, HVAC, roof, or structure
  • Access Interference: Tenant claims landlord's construction or actions interfered with business operations
  • Breach of Quiet Enjoyment: Tenant claims landlord's actions substantially interfered with use of premises
  • Discriminatory Enforcement: Tenant claims landlord enforces lease terms selectively against them
Assess the Strength of Tenant's Claim
Factor Strong Claim (Risk) Weak Claim (Defensible)
Lease Language Lease clearly supports tenant's position Lease is silent, ambiguous, or favors landlord
Documentation Tenant has invoices, photos, prior correspondence proving claim Tenant has no evidence; vague allegations
Prior Notice Tenant gave written notice; you failed to respond or fix Tenant never notified you; you had no opportunity to cure
Industry Standard Your actions deviate significantly from market practice Your actions are standard/reasonable
Damages Tenant has quantifiable damages (lost revenue, repair costs) Tenant claims vague "damages" without proof
Response Strategies
Strategy 1: Acknowledge & Resolve (Legitimate Claims)

If tenant's claim is valid:

  • Acknowledge the issue promptly
  • Make repairs or provide CAM refund as appropriate
  • Document resolution and obtain tenant's sign-off
  • Preserves tenant relationship; avoids costly litigation
Strategy 2: Partial Acknowledgment (Mixed Claims)

If some claims are valid, others are not:

  • Address valid issues (repairs, legitimate CAM corrections)
  • Refute invalid claims with lease citations and evidence
  • Offer compromise on disputed items to avoid litigation
Strategy 3: Full Defense (Meritless Claims)

If tenant's claims are unfounded:

  • Provide detailed response citing lease provisions
  • Attach documentation proving compliance (invoices, photos, correspondence)
  • State tenant's claims are without merit and you will vigorously defend if tenant litigates
  • Do not offer concessions for meritless claims
CAM Dispute Response Strategy

When tenant disputes CAM reconciliation:

  • Review Audit Request: Comply with lease audit rights; provide requested documentation promptly
  • Identify Errors: If audit reveals legitimate errors, issue corrected reconciliation and refund
  • Defend Proper Charges: For disputed charges that are proper, provide detailed explanation citing lease definitions of "Operating Expenses"
  • Negotiate Settlement: If tenant has some valid points, offer partial credit to avoid litigation
Repair Dispute Response Strategy

When tenant claims failure to repair:

  • Check Lease Allocation: Verify repair is your responsibility (not tenant's under NNN lease)
  • Review Notice: Did tenant give proper written notice? When? Did you respond?
  • Make Repairs Promptly: Even if you dispute responsibility, making repair ends dispute and preserves relationship
  • Document Completion: Provide tenant with photos, invoices, contractor confirmation that repair is done
Drafting Your Response Letter
Response Letter Components
Component What to Include
Opening Acknowledge receipt of tenant's letter/demand
Lease Reference Cite specific lease sections governing disputed issue
Your Position State whether you agree, partially agree, or disagree with claims
Supporting Facts Provide documentation: invoices, correspondence, photos, prior notices
Resolution Offer (if any) If willing to compromise, state specific terms
Defense of Position Explain why tenant's claims lack merit (cite lease, industry standards)
Reservation of Rights State you reserve all rights and remedies under lease and law
Tone & Strategy
  • Professional: Avoid emotional or defensive language; stick to facts and lease terms
  • Firm but Open: Defend your position but indicate willingness to discuss if tenant has legitimate concerns
  • Document-Heavy: Attach all supporting documentation (invoices, allocation schedules, prior correspondence)
  • Deadline: If appropriate, give tenant deadline to respond or provide additional information
What to Avoid
  • Admitting fault unnecessarily (if genuinely unsure, state you are investigating)
  • Making promises you can't keep (don't commit to timeline you can't meet)
  • Threats or intimidation (stay professional)
  • Ignoring legitimate issues (even if letter contains some meritless claims, address valid points)
Sample Response Letters
Sample 1: Response to CAM Dispute (Partial Acknowledgment)
[Landlord Name] [Address] [Date] [Tenant Name] [Address] RE: Response to Your CAM Dispute Letter Dated [Date] [Property Address] Dear [Tenant]: I am responding to your letter dated [Date] disputing the CAM reconciliation for [Year]. I have reviewed your audit report and our records. Here is my response to each issue you raised: 1. PARKING LOT RESURFACING ($[Amount]): You claim this is a capital expense that should be amortized. I agree. This was an error in our reconciliation. The parking lot resurfacing has a 15-year useful life. The correct annual charge is $[Amount/15]. Adjustment: Credit $[Amount] 2. ALLOCATION PERCENTAGE: You claim we improperly excluded vacant spaces. After reviewing, you are correct that per Lease § [X], allocation should include all leasable square footage. We have recalculated your share as [X]% instead of [X]%. Adjustment: Credit $[Amount] 3. MANAGEMENT FEE (15%): You claim the 15% management fee is excessive. I disagree. Our management company provides comprehensive services including [list services]. Section [X] of the Lease states management fees shall be "customary and reasonable." In [City], commercial property management fees range from 10-18% depending on services. Our 15% fee is within market range and reasonable given the extensive services provided. No adjustment. 4. LEASING COMMISSIONS: You are correct that leasing commissions are explicitly excluded by Lease § [X]. This was an administrative error. Adjustment: Credit $[Amount] CORRECTED RECONCILIATION: Original Reconciliation Total: $[Amount] Less: Adjustments 1, 2, and 4: ($[Amount]) Revised Total CAM: $[Amount] Your Corrected Share: $[Amount] Amount You Paid: $[Amount] CREDIT DUE: $[Amount] RESOLUTION: I will apply the $[Amount] credit to your next three months' CAM payments ($[Amount] per month). I have attached the corrected reconciliation statement with updated allocation schedule and amortization calculation. Thank you for bringing these issues to our attention. If you have questions about the revised statement, please contact me. Sincerely, [Your Signature] [Your Name] Attachment: Revised CAM Reconciliation
Sample 2: Response to Repair Failure Claim (Defense)
[Landlord Name] [Address] [Date] [Tenant Name] [Address] RE: Response to Demand for Repairs – [Property Address] Dear [Tenant]: I am responding to your letter dated [Date] claiming I failed to repair the HVAC system. LEASE RESPONSIBILITIES: Section [X] of the Lease ("Maintenance and Repairs") states: "Tenant shall be responsible for all repairs and maintenance to the Premises, including HVAC systems, plumbing, electrical, and all interior and exterior components." This is a triple net (NNN) lease. You are responsible for all repairs, including HVAC maintenance and replacement. NOTICE AND RESPONSE: You state you notified me on [Date] about the HVAC issue. I have reviewed my records and find: • I received your email on [Date] stating the AC was "not cooling well" • I responded on [Date] advising you to contact your HVAC contractor, as HVAC maintenance is your responsibility per the Lease • I provided contact information for three licensed HVAC contractors I fulfilled my obligations by responding promptly and clarifying lease responsibilities. CONCLUSION: Your demand that I repair the HVAC and reimburse you for lost revenue has no merit. Under the Lease, HVAC repairs are your responsibility. If you believe the Lease requires me to repair HVAC systems, please cite the specific lease provision. I am not aware of any such provision. I reserve all rights under the Lease. Sincerely, [Your Signature] [Your Name]
Sample 3: Response to Interference Claim (Acknowledge & Resolve)
[Landlord Name] [Address] [Date] [Tenant Name] [Address] RE: Response to Your Letter Regarding Construction Interference Dear [Tenant]: Thank you for your letter dated [Date] regarding construction disruptions from our renovation of Suite [X]. I apologize for the inconvenience this has caused your business. I take your concerns seriously. ACTIONS TAKEN: I have instructed my contractor to: • Move all equipment and trucks away from your storefront immediately • Limit noisy work (jackhammering, sawing) to weekdays between 8:00 AM - 5:00 PM (after your business hours) • Ensure main parking lot entrance remains clear at all times • Provide you 24-hour advance notice of any planned utility shutoffs TIMELINE: The renovation is scheduled to be completed by [Date – 2 weeks from now]. I will personally monitor the site to ensure compliance with these restrictions. RENT ADJUSTMENT: I recognize the disruption has affected your business. I am willing to provide a 10% rent abatement for the period of [Date] through [Completion Date] (approximately [X] weeks) as compensation for the inconvenience. If this is acceptable, please sign the attached rent adjustment agreement and return it to me. Again, I apologize for the disruption and appreciate your patience as we complete this necessary renovation. Sincerely, [Your Signature] [Your Name] Attachment: Rent Adjustment Agreement
Defending Litigation
When Tenant Sues

If tenant files lawsuit for breach of lease, CAM refund, or damages:

  • Answer Complaint: Respond within 30 days; assert all affirmative defenses
  • Counterclaim: If tenant owes rent or breached lease, file counterclaim
  • Discovery: Obtain tenant's financial records to challenge "lost revenue" claims
  • Expert Witnesses: Hire CPAs or property managers to testify about standard industry practices
Common Defenses
  • Lease Terms: Disputed obligation was tenant's responsibility per lease, not landlord's
  • Lack of Notice: Tenant never properly notified landlord of issue; landlord had no opportunity to cure
  • Timely Performance: Landlord made repairs/provided services within reasonable time per lease
  • No Damages: Tenant cannot prove actual damages (no lost revenue documentation)
  • Tenant Breach: Tenant is in default (nonpayment of rent or CAM), barring their claims
Counterclaims to Assert
  • Unpaid rent or CAM charges
  • Breach of lease (if tenant violated use clause, failed to maintain property, etc.)
  • Declaratory relief (request court interpret lease provisions)
  • Attorney fees (if lease allows, prevailing party recovers fees)
Attorney Services
Commercial Tenant Disputing Lease Terms?

I represent commercial landlords in disputes with tenants over CAM charges, repairs, lease enforcement, and breach claims. I draft responses, negotiate settlements, and defend litigation.

How I Can Help
  • Review tenant's demand letters and assess strength of claims
  • Draft professional response letters citing lease provisions and defenses
  • Negotiate settlements when appropriate
  • Defend lawsuits filed by tenants for breach of lease or CAM refunds
  • File counterclaims for unpaid rent and tenant breaches
  • Coordinate with CPAs and experts to defend CAM charges
Schedule a Call

Book a call to discuss your commercial tenant dispute. I'll review the claim, assess your defenses, and advise on the best strategy for resolution or litigation.

Contact Information

Email: owner@terms.law

Commercial Tenant Disputes — What California Landlords Need to Know

Commercial tenants frequently dispute CAM (common area maintenance) charges, allege landlord failure to make repairs, or claim breach of quiet enjoyment. Unlike residential disputes governed by tenant protection statutes, commercial lease disputes are resolved primarily through contract interpretation. The lease document governs who is responsible for repairs, how CAM charges are calculated, and what remedies are available. California commercial landlords must respond strategically—acknowledging legitimate issues while defending against meritless claims—to avoid costly litigation and preserve the landlord-tenant relationship.

Common Commercial Tenant Claims Against Landlords

Responding to Commercial Tenant Demands

When a commercial tenant sends a demand letter or files a formal complaint, landlords should evaluate the claim's merit before responding. Review the lease provisions that govern the disputed issue, gather all documentation (invoices, correspondence, photos, prior notices), and determine whether the claim is valid, partially valid, or meritless. For legitimate issues, acknowledge and resolve them promptly to preserve the relationship and avoid litigation. For mixed claims, address valid points while refuting unfounded allegations with specific lease citations. For completely meritless claims, provide a detailed defense citing lease terms and industry standards, and state you will vigorously defend any litigation.

CAM Disputes — Landlord Defense Strategies

Defending Against Breach Claims in Court

If a commercial tenant sues for breach of lease, CAM refunds, or damages, landlords have several defenses available. The most common defense is that the disputed obligation was the tenant's responsibility under the lease—particularly in NNN (triple net) leases where tenants handle most repairs and maintenance. Landlords can also argue the tenant failed to provide proper notice of the issue, denying the landlord an opportunity to cure. If the tenant claims lost revenue, challenge their damage calculations by demanding financial documentation through discovery. Consider filing counterclaims for unpaid rent, CAM charges, or tenant breaches. If the lease includes an attorney fees clause, the prevailing party recovers legal costs, which often motivates settlement.