Boilerplate Booby Trap: Clauses Requiring Written Agreement for Lease Termination

Here’s a suggestion for anyone who uses a standard boilerplate lease: Look through the document and see if it includes a statement like this. If it does, it’s most likely to be toward the end of the lease.

The Booby Trap

The notion of making landlords and tenants stick to the lease terms unless they modify them in writing seems harmless enough. And that was the initial impression of the New York City attorney who came across the language while reviewing the lease of a client that had just purchased a commercial building.

But just as his eyes were advancing to the next provision, a thought popped into the attorney’s head. Suppose the landlord is attempting to terminate the lease of a tenant in default, but the tenant is determined to stay. Would a tenant with a clever attorney be able to rely on this boilerplate language to thwart the landlord’s attempt to terminate? The argument: No lease termination sought by the landlord may occur without the tenant’s written agreement.

Arguing that a landlord can’t evict a defaulting tenant without that tenant’s prior written agreement would take some chutzpah. But that is a supportable interpretation of the clause when you read it literally. The case for such an interpretation in a tenant’s favor would be even stronger if the landlord is a sophisticated businessperson with extensive leasing experience.

How to Disable the Booby Trap

It goes without saying that no landlord wants to be obligated to obtain a tenant’s written permission as a condition to terminating the tenant’s lease when the tenant is in breach of that lease. The good news is that there are two simple things you can do to avoid finding yourself in this unenviable position:

• Be aware that the “no change, termination, or waiver without a written agreement” clause is a boilerplate staple and be on the lookout for it in your own lease forms; and
•  If you do run across the troublesome clause, you can neuter it simply by deleting all references to “terminated” and “termination.” This way, only lease changes or waivers will require a written agreement signed by the party against whom enforcement of the change or waiver is sought.

Epilogue

Luckily for his client, the New York attorney mentioned above was alert enough to spot and disable this booby trap. And we thank him for sharing his insight from the experience to help you all do likewise.

Editor’s Note: If you’d like to share tips you’ve learned on avoiding boilerplate booby traps, email them to glennsdemby@gmail.com.