If your landlord provides you with a lease, more than likely it will be one-sided. You often can correct the imbalance by requiring reciprocal provisions. The following are the most common types of clauses that should be reciprocal:
- Indemnification. The landlord typically tries to push all risk and liability to the tenant. The tenant should push some of this risk and liability back to the landlord.
- Force Majeure. The landlord typically tries to push the risks of unforeseen events such as earthquakes, fires, etc. to the tenant. The tenant should push back some of these risks to the landlord.
- Hazardous Materials. Require the landlord to provide you with an environmental warranty promising that the space isn’t contaminated. Also require the landlord to defend and indemnify you if the warranty is breached. Require the landlord to pay cleanup costs. Ask for the right for rent abatement and the right to terminate the lease if hazardous waste interrupts your business. You may also require environmental insurance.
- Insurance and Waivers of Subrogation. The landlord typically tries to push their risk to the tenant’s insurance. The tenant should push these risks back onto the landlord’s insurance.
- Waiver of Claims. The landlord might try to require the tenant to waive claims against the landlord without a reciprocal waiver. If the landlord wants waivers from the tenant, the tenant should ask for waivers from the landlord.
- Default clause. Include a provision that specifies landlord defaults such as the landlord’s failure to pay for tenant improvements, the failure to comply with the lease terms and obligations, and any representations and warranties that prove to be false.
- Remedies. Include your remedies such as lost profits, relocation expenses, attorney’s fees, punitive damages, recission for failure to deliver, injunctions, specific performance to perform required act, and declaratory judgment to declare who is right.
- Damage and Destruction. The landlord often requires the tenant to pay for damage and destruction the tenant causes without a reciprocal responsibility. The tenant should require the landlord to pay for damage and destruction it causes.