Commercial Lease Indemnity Provisions

img_1543
At Schorr Law, our Los Angeles commercial real estate attorneys have significant experience litigating all types of commercial leasing disputes.   Those disputes can arise out of the most basic terms or complex risk shifting terms often contained in commercial leases.  For example, most commercial leases contain an indemnity provision that require the tenant to reimburse the landlord for things like a slip and fall that occurs in the common area of a property.   Even though insurance usually covers these types of disputes, it is important to understand every term in a commercial lease – even boilerplate terms.

Here is an analysis of a published California opinion dealing with a boilerplate indemnity provision.

Morlin Asset Management LP v. Murachanian 

The Facts:

In summary, a commercial building leased an office space to a dental office.  To clean the office’s carpets, the dental office hired a local vendor.  That vendor then sent a man to do the job. As the man walked up a flight of stairs in the common area he happened to slip and fall. As a result, the man sued the landlord to recover damages from the sever injuries he sustained.

Landlord’s Response to Suit: 

In an attempt to seek indemnity from the tenant/dental office, the landlord cited to section 8.7 of the commercial lease.  That provision, which is representative of common boilerplate provisions, held:
Except for Lessor’s gross negligence or willful misconduct, Lessee shall indemnify, protect, defend and hold harmless the Premises, Lessor and its agents, Lessor’s master or ground lessor, partners and Lenders, from and against any and all claims, loss of rents and/or damages, liens, judgments, penalties, attorneys’ and consultants’ fees expenses and/or liabilities arising out of involving or in connection with, the use and/or occupancy of the Premises by Lessee. If any action or proceeding is brought against Lessor by reason of any of the foregoing matters, Lessee shall upon notice defend the same at Lessee’s expense by counsel reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee in such defense. Lessor need not have first paid any such claim in order to be defended or indemnified.  (Morlin Asset Management LP v. Murachanian (2016) 2 Cal.App.5th 184, 188.) (Emphasis added by the Court of Appeals.)

The Ruling and Conclusion: 

In agreeing with the lower court, the Court of Appeal made the distinction between the common area and the “Premises.” Specifically the Court held:

the injury to a third party that occurred outside the dental suite, in a common area over which the landlords have exclusive control, did not arise out of the tenant’s use of the dental suite. It does not matter that the accident would not have happened but for the tenant hiring the third party to clean the carpets in the dental suite, and that the third party may have been at fault. The connection between the tenant’s use of his suite and the accident in the stairwell over which the tenant had no control is too remote to have been within the contemplation of the parties when they entered into the lease.  (Id. at 193.)

Accordingly, the lesson here is to carefully review each boilerplate provision in your commercial lease and assess the need for extra protection.

Schorr Law’s real estate attorneys in Los Angeles have experience resolving lease disputes. To inquire about a free 30-minute consultation, contact us by phone at (310) 954-1877 or by email at info@schorr-law.com.

 By Randy Aguirre, Los Angeles Real Estate Attorney.

Click on the categories below to read other related blog posts. 

Share Button
Tagged with: , , ,
Posted in Boilerplate Provision, Commercial Lease, Commercial Real Estate, Real Estate Attorney Los Angeles

Zachary D. Schorr’s Expert Appearance on the Dr. Phil Show

Zachary D. Schorr’s Expert Appearance on ABC’s Nightline

Contact Schorr Law

Super Lawyers

Zachary Schorr Superlawyers

Zachary D. Schorr has been named to the Southern California Super Lawyers (Rising Stars) list for attorneys in Real Estate for 5 straight years - 2012, 2013, 2014, 2015 and 2016. Each year, no more than 2.5 percent of the lawyers in the state receive this honor. In 2016 he was also included as one of the top 100 lawyers in Southern California in this category. The selection for this respected list is made by the research team at Super Lawyers.

Need Representation?

If you are currently involved in a real estate dispute, either commercial real estate or residential, and are looking for a Real Estate Attorney in Los Angeles with a cost-effective, results oriented approach designed to meet your case's specific needs, contact the attorneys at Schorr Law. Our real estate firm has the specific knowledge and experience necessary to get you the best possible results.

AVVO 10.0

Zachary Schorr Avvo Rating

Avvo Clients’ Choice Award Recipient

Zachary Schorr Avvo Client's Choice Award