Do I Have To Pay For It – Part 1

When everything in your business is running smoothly, no one questions anything. However, as soon as something breaks, everyone starts pointing fingers because no one wants to pay for fixes. This is the unfortunate reality of running a business. You will never be able to predict when things will break, and you will have little control over preventing failures. However, there are proactive steps you can take to minimize the impact on your business when something does go wrong. In this article, we are going to talk about how to protect yourself when something big in your commercial space breaks.

The Factual Scenario

Here is the basic scenario:  The gym owner enters a commercial lease for a physical facility.  Because most gyms owners are not sophisticated and experienced business people who are skeptical that the world is out to get them, they don’t know to predict worst case scenarios when entering corporate contracts.  So, the gym owner signs a lease that is written for the financial benefit of the landlord.  

After opening, the gym is running smoothly and the gym owner starts to make money.  However, a year in, the boiler fails in the building, there is no heat, and the temperature outside is 11 degrees.  The gym owner contacts the landlord demanding that the landlord fix the issue, and the landlord says, “Sorry, according to the lease, you are responsible.  I can bring in my contractor, but it’s going to cost you several thousand dollars to repair.  Also, don’t forget your next lease payment is due soon.”  

What is the gym owner supposed to do in this situation?  

Is It Too Late?

We want to thank Affiliate Guard for reaching out to us with this question and video topic suggestion.  Affiliate Guard is the leading insurance provider for micro gyms.  They understand the unique needs and characteristics of micro gyms and how those needs differ from other kinds of commercial properties.  

Gym owners contact Affiliate Guard all the time to make insurance claims to cover these large failures, often because the gym owner was not diligent in protecting himself or herself when signing the lease.  

From a legal point of view, it is too late.  Once that lease is signed it is a binding legal contract and the terms of that contract are legally enforceable.  Therefore, if the gym owner decides not to pay for the repairs and/or not to pay for the next month’s lease in protest, he or she is technically in breach of contract and can be sued by the landlord for damages.  This is a potentially business ending issue.  

What Can You Do?

Getting out in front of these kinds of issues before signing the commercial lease is the best way to really protect yourself. That is where an attorney experienced in your unique needs comes into play.  The majority of the law is reactive, meaning it only steps in once there is a problem. However, again, from your perspective, once there is a problem, it is too late.  

To prevent this from happening, you need to make sure that your commercial lease has a maintenance section.  Additionally, that maintenance section needs to spell out who is responsible for what.  The clearer the better.  It isn’t enough to have a statement like, “The Lessor (the Landlord) is responsible for maintaining the premises.”  

Statements like that are vague and leave a lot of gray.  It is much better to have a lease that states, “The Lessor (the Landlord) shall maintain the roof, foundation, underground, plumbing, heating system, air conditioning equipment, and the structural soundness of the exterior walls, excluding all windows, window glass, plate glass, and all doors, and including the reasonable care of landscaping and regular mowing of grass, and maintenance of any paving outside the Leased Premises.”  

If you have a question about the language in your lease, reach out to us.  We educate gym owners on matters like this and make sure they are protected from the beginning. Ideally, we can help you before you ever sign.  However, if you have already signed, you still have negotiable power and we can still help.  We are here to help predict and prevent legal issues that may disrupt or destroy your business. 

Gym Lawyers PLLC is a law firm dedicated to educating gym owners on the areas of law that impact their business. Any and all information on this site is meant for EDUCATIONAL purposes only. It cannot be relied upon as legal advice. Every situation is different and every state has laws that apply differently to every situation. The legal principles discussed here are general in nature and may or may not apply to your situation under your state laws. For more individualized information, you must reach out to us directly.

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