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Mission Accomplished: Evicting Over Two Dozen Commercial Tenants by a Date Certain or Pay a Massive Amount of Money

Adam Leitman Bailey, P.C.’s client, a Fortune 500 company, net-leased or leased an entire building from its landlord. The tenant’s lease was expiring on April 30th. The tenant had leases with over two dozen sub-tenants and many of them, despite having leases end before April 30th, had no intention to move out when the lease ended. The tenant was in a quandary because if it did not evict all of the tenants by April 30th, it would have to pay heavy fines to the landlord for the breach. Second, none of the tenants’ subleases had any strong default provisions incentivizing the sub-tenants to vacate when the lease ended.

Against all odds, Adam Leitman Bailey, P.C. was hired to make sure that the building was not only complexly vacant by April 30th, but that the tenants spent the money to restore the premises to its original condition, which for a number of tenants would be a substantial burden.

The challenges were plentiful. Although Adam Leitman Bailey, P.C. basically had little recourse against any tenant staying past its term, one tenant had diplomatic immunity which with the right tenant’s attorney could do serious damage to the tenant of record. At the same time, Adam Leitman Bailey, P.C. did not want the tenants to know the firm was desperate for them to leave on time. Adam Leitman Bailey, P.C. was friendly with the tenant who had immunity’s attorney and explained to him that it would have to run to court early because of lease defaults and the firm was worried about the tenant’s diplomatic immunity power. As a result, the sub-tenant agreed to give Adam Leitman Bailey, P.C. a document that would allow a warrant to be served in early April and executed on April 30th. This chain of events was a result of having a good reputation in the industry, Adam Leitman Bailey, P.C.’s straightforward and respectful relationship with the colleague attorney representing the tenants, and a lot of luck.

Some of the other tenants smelled money and a lot of it, and they wanted a payout. Adam Leitman Bailey, P.C. let it be known that not one dollar would be paid. Adam Leitman Bailey, P.C. was known for using self-help in evicting tenants without going to court, and it would not be afraid to use it here. Adam Leitman Bailey, P.C. forwarded a number of decisions as well as articles and a chapter from a book on default clauses where the firm did the same using self-help, but the firm had no idea until the very end if it would be able to hand back the keys on time.

Getting the sub-tenants to put their spaces in their original condition provided the next challenge. Many alterations had been completed with agreements to restore them before the end of the lease. Adam Leitman Bailey, P.C. counseled its client to start speaking with the tenants about the restoration to see if Adam Leitman Bailey, P.C. had any problem tenants the firm needed to take action on now. Some of the tenants had not started alternations, others hired companies for amounts of money that would not do the job properly, and others hired companies that Adam Leitman Bailey, P.C. had not worked with before so the firm investigated their abilities. For some of the tenants, Adam Leitman Bailey, P.C. decided to avoid the potential problem and had them pay the firm for its contractor to do the work.

In the end, all the alterations had been completed. Adam Leitman Bailey, P.C. was now able to monitor the progress and had been in touch with the outside contractor doing work if that had been the tenant’s choice. This allowed Adam Leitman Bailey, P.C. to make sure the project and restorations were on schedule and met a certain quality.

Next, Adam Leitman Bailey, P.C. had contacted the remaining tenants to see if it could facilitate their moves in any way through elevator time, giving them additional workers to assist carrying items, or writing good tenant letters. This was a risky decision as it demonstrated Adam Leitman Bailey, P.C.’s need to have the tenant’s out by a certain date. In past building tenant exodus, tenants, many times, would use this opportunity to threaten to stay unless payment of a large sum of money. However, by the time of this last contact, so close to the termination date, all the tenants gave their new addresses and expected vacate dates.

In the end, Adam Leitman Bailey, P.C. handed in the keys with all tenants vacated and the building in clean condition in compliance with the lease.

Adam Leitman Bailey represented the master commercial tenant in strategy and negotiations. Dov Treiman drafted settlement agreements and notices of eviction.

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