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Daoust Vukovich is pleased to announce recognition of seven lawyers selected in the 2024 Canadian Legal Lexpert Directory, highlighting their expertise and leadership in the Commercial Leasing...
Lease use clauses are very important to both landlords and tenants, especially in the context of shopping centres and other retail properties. Landlords prefer narrow use clauses that give them control over the merchandising mix in order to ensure that customers, as well as new retailers, are attracted to a property for its diverse array of merchants. Tenants prefer broad use clauses that give them freedom to adapt to changes in the marketplace and allow them to evolve in their product service offering. Broad use clauses also make it easier for tenants to transfer their interest in the lease to another party. Tenants exit shopping centres for a myriad for reasons; they want maximum flexibility to unload their rent and other obligations for space they no longer wish to use.
Read the full article: Consent to Change of Use
When dealing with limitation periods, once it is determined whether the 2-year or 6-year period applies, it’s critical that the parties turn their mind to the question of: “starting when?”.
The 1971 landmark Supreme Court of Canada decision in Highway Properties Ltd. v. Kelly, Douglas and Co. Ltd., transformed the commercial leasing landscape by adding a fourth option of relief provided to landlords. Prior to this, landlords had three options available: do nothing and demand payment when due, terminate the tenancy and elect to pursue a claim for arrears, or re-enter the premises and re-let on the tenant's behalf. In this decision, a fourth option was introduced, affording landlords the option to terminate the lease and pursue a claim for both arrears and damages. The decision affirms that commercial leases, similar to a contract, ought to be recognized and treated as such, which affords landlords the full remedies under both contract and conveyance laws. However, a recent claim was brought before the courts, where a tenant challenged the decision in Highway Properties, requesting the previous decision be overturned.
On June 27, 2023, the Bureau released the Competition Bureau Retail Grocery Market Study Report aptly named “Canada Needs More Grocery Competition”. This report contained recommendations to the government, including that the Tribunal take measures to limit exclusive use covenants (referred to in the Bureau’s report as “property controls”) in the grocery industry.
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