Default on Real Estate Lease
I am the owner of a commercial property located in the state of Louisiana. My former tenant, who still had 10 months left on his lease suddenly abandoned the property without notice. I have located this person in another state, and he does have financial resources to make good on the unused portion this lease. I wish to know if it possible for me enforce this lease even though this person is now living in a state different from where the lease was made?
2 Answers from Attorneys
Re: Default on Real Estate Lease
The quick answer to your question is "yes." The detailed answer, of course, it a bit more complex.
The fact that your former tenant is now out of state should not affect your ability to proceed against him in relation to his breach of the lease...and you can even proceed against him in a Louisiana court (you will have to get him served).
The real wildcards affecting this action are this:
1) What does the actual lease contract say about abandonment? If the lease was in writing, it may speak to this issue, and it may provide a resolution (i.e. the rents are accelerated, 50% of the rents are due, etc.). If the lease does not speak to this, or if the lease was not in writing, under Louisiana law you have a cause of action against the tenant for the rents due for the rest of the lease's term....subject to:
2) As a landlord, you have an obligation to "mitigate your damages," which means you're obligated to make good faith attempts to re-let the premises.
If you are successful, your former tenant is only responsible to you for the (a) rent due from the abandonment until the re-letting; and/or (b) the difference in rent, if you have to rent for less.
If you are unsuccessful, the tenant should be obligated to you for all rents over the unpaid term.
If you do not make an effort to re-let the premises, a court could find that you failed to mitigate your damages and will not make the tenant liable to you for the entire unpaid term, but only for the portion of the term when you "would have been" looking for other tenants (i.e. a month or two).
3) Finally, the real consideration you have on your hands is this: Will a proceeding against the tenant be worth it?
Chasing a "ghost" in court is never a pleasant experience, and so if a tenant left you high and dry, but has not assets or real net worth, you'll simply spend money in the chase.
If this is not the case, however, it may be worth it to pursue the tenant for the lost rents. Since the tenant is in another state, you may have a slight advantage over him in that it will cost the tenant a bit more to find local representation.
Finally, depending on your goals, even if the tenant does not have the financial ability to pay this debt - it might still be worth a pursuit. If he is another state and will not likely show up to represent himself, you may be able to get a "default judgment" against him, which will go on his credit report, and be enforceable for a period of 10 years (you can get it renewed).
At our firm, we typically spend $3000 - $5000 in obtaining a default judgement.
Re: Default on Real Estate Lease
Yes you can
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