The part of being a property manager that every property manager dreads: commercial tenant eviction. They signed a contract, they breached the contract in whatever way, and now you have to kick them out.
Eviction isn’t fun for anybody, least of all you! You have rights, but so do they. There are strict laws and regulation in place and you don’t want to do something wrong in the process!
It can be a sticky situation. Click here for your step-by-step guide to a successful (and hopefully painless) tenant eviction.
1. Understand Your Local Laws
The cardinal sin you can commit as a property manager or owner is to make decisions and deal out evictions without understanding your state’s laws.
Don’t make the mistake of assuming every state will totally uphold whatever you decide is right! (Even if you think it’s super obvious, like if your commercial tenants haven’t paid rent in six months.)
Some states are considered “tenant-friendly” or “renter-friendly.” Their laws and court rulings tend to favor the tenant. That includes commercial tenants in businesses, offices, etc.
Here are a few of the heavily renter-friendly states:
- Vermont
- Delaware
- Hawaii
- New York
Other states are much more landlord- and property manager-friendly. Their laws and court rulings lean toward the owner’s rights:
- Arkansas
- West Virginia
- Louisiana
- Colorado
- Georgia
Courts often uphold the owner’s right to enforce the contract and get a judgment on the tenant. It’s important to know what type of state you live in and what kind of laws you’re dealing with. Don’t make any rash moves without understanding the laws in your state!
2. Understand Your Contract
Imagine calling your tenants out on a breach of contract, and then they correct you. You were wrong. You could’ve sworn you put something in the contract but you didn’t!
Nothing would look worse than being wrong about the contract you wrote and are trying to enforce! Before you take any action toward tenant eviction, thoroughly read and understand your contract.
You can even go through the contract and mark the parts that you believe the tenants have violated. Here are some common breaches of contract that tenants are evicted for:
- Criminal activity
- Failure to pay rent
- Property damage
Eviction is exactly why your contract needs to be impenetrable, thoughtful, and completely legal before anyone signs it! Your contract won’t do you a lot of good if a court or judge can’t uphold its legality.
For example, if you want to evict your commercial tenant for failure to pay rent, you can use the “summary” eviction process (we’ll go into that right after this). If you want to evict for anything else, you can’t use the summary process: you have to formally file an eviction case.
That being said, it’s important to know your rights as a landlord and a contract holder. Did you know that tenants can actually sign away their rights to sue you? It’s legal to have that kind of thing in your contract.
Did you know that you, as the landlord, can lawfully change the locks on the business door without filing an eviction case if the tenant hasn’t paid rent? You must post written notices on the door, but it’s legal to change the locks.
Understanding your contract before taking action includes making sure you’ve held up your end of the contract! You don’t want the tenants to be able to come back and say you also broke it.
3. Send a Proper Eviction Notice
So it comes time to send the eviction notice. Did you know there are different kinds of eviction notices? Make sure to understand which type is right in your case.
If you’re evicting for failure to pay rent, you’ll use the “summary” eviction process. That involves suing the tenant and serving a “pay rent or quit” notice.
The first type is a notice to pay rent or quit (vacate). That’s for tenants who have thus far upheld their contract besides paying rent. You’re giving them a chance to do so before making eviction mandatory.
This is a five day notice, which makes it faster than the residential eviction process. So the legal process is quicker for commercial landlords in this case!
The second is a notice to comply or quit. This is for tenants who are violating the lease terms in some way. Again, they have a chance to change things before getting evicted.
The third type is a notice to quit. This tells the tenants that they must move out and there’s nothing they can do (at this point) to change that.
Yes, these are all legal in commercial renting! The process is just a little different between commercial and residential.
With commercial tenant eviction, the most common term is a three-day notice. That’s vastly different from residential, which requires anywhere from seven to thirty days.
4. Involve the Court If Necessary
“Eviction” is technically a legal process.
Sometimes you can get away with not involving the courts — that can happen if your tenants promptly pay rent after you send the five-day notice.
Those tenants generally leave in the allocated time to avoid having to go to court, paying court fees, and getting a judgment. Especially business owners with good credit and history.
If the tenants are being served a notice for anything other than failure to pay rent, then you must file an eviction case. If this is the situation you find yourself in, consider talking to a commercial litigation lawyer.
They can help you fully understand your state’s laws, what your contract allows and guarantees you, and how exactly to go about the commercial eviction case process in court. Check out our page about commercial tenant eviction for more information.
Save Yourself Time, Energy, and Money: Understand Successful, Legal Tenant Eviction
Don’t be in the dark when it comes to a successful, legal commercial tenant eviction. Some states will work for you, some states are harder: make sure to know which ones you own commercial rental property in!
Fully understand your contract and its legality, know what kind of eviction notice will work for you, and get comfortable with the idea of involving the courts when required. Being a successful, law-abiding landlord and property manager requires knowledge, commitment, and continuous education.
Don’t hesitate to reach out for that education and knowledge. We can answer your questions and help you understand everything involved.
Contact us with questions, inquiries, to talk with an attorney, or for more information.
