Commercial property leases are often extremely complex, which is why so many landlords in Texas and around the country often become embroiled in bitter legal disputes with the companies that rent space from them. This litigation often hinges on the interpretation of provisions dealing with rent, property taxes, the maintenance of common areas and subletting restrictions, and it can drag on for months or even years. To prevent these disputes from escalating into costly and public court battles, many commercial leases now require landlords and tenants to resolve their differences through mediation.
Commercial lease mediation
When disputes are settled by a jury, only one party leaves the courtroom happy. This is because court proceedings are adversarial in nature, but mediation is different. A judge maintains order in the courtroom and ensures that attorneys follow the law, but they leave the final decision up to the jury. Mediators have a different role. They focus on bringing disputing parties together, encouraging cooperation and finding common ground.
Advantages of mediation
Mediation clauses are usually included in business leases to avoid the costs of commercial real estate lawsuits, but that is not the only benefit they provide. Mediation sessions take place behind closed doors, which encourages frank and open communication and helps disputing parties to find creative solutions to complex problems. This nurtures empathy and understanding, which can strengthen relationships that once appeared irreparably damaged. Parties that emerge from mediation often have renewed respect for one another, which could be enough to prevent disagreements from turning into disputes in the future.
Mediation offers commercial landlords and their tenants a faster, less expensive and private alternative to litigation. Lawsuits can take months or years to resolve, but mediation sessions rarely last for more than a few hours even when the matters being discussed are complex. While mediation has many advantages, it does not offer as many benefits as avoiding commercial lease disputes in the first place. To reduce the chances of becoming involved in such a dispute, landlords and commercial tenants should consider the future before they enter into agreements. Landlords should draft leases that are basically fair, and commercial tenants should not sign lease agreements until they understand the implications of all of their provisions.