Lease Expired and No One Noticed? What You Can Do
It is not uncommon for a lease to expire without the landlord noticing, leading the tenant to continue operating from the premises, regardless of whether they were aware the lease had expired. What happens next is contingent on the terms of the lease and the conduct of each party. The main question that the landlord needs to ask themselves is whether they are willing to have the tenant extend their lease, or whether they need them out as soon as possible.
There are three main options that a landlord has when a tenant continues to operate on the premises once a lease has expired.
Option #1: Require the Tenant to Vacate
There is no way of proving whether or not the tenant simply didn’t notice that the lease had expired, or knew but decided not to bring it up. No matter the case, the landlord has the right to notify the tenant to vacate the premises.
What if the Tenant Refuses to Leave?
If the tenant refuses to leave the premises, or fails to do so within the time limit, then the landlord can take legal action. Importantly, it is illegal to change locks, remove the tenant’s belongings or turn off utilities to force a tenant out.
If you have evidence that you issued the tenant with a timely notice to vacate the premises and they either ignored or denied it, then you can follow a legal eviction process. This includes making an application to the relevant court or tribunal in your state for an eviction order. If they still refuse to leave after a formal eviction order, then you can take steps to enforce that order, including engaging the relevant enforcement authority (such as the Sheriff) to execute a warrant of possession.
Option #2: Holding Over
Most commercial leases contain a ‘holding over’ clause that, with the consent of the landlord, allows the tenant to continue operating on the property after the lease term expires on a month-to-month basis. This new arrangement is often terminable on short notice (usually one month’s notice) and all tenant obligations that were present before the lease expired still apply.
Even if the lease does not contain a holding over clause, and the tenant continues to occupy the premises past the expiry date while still paying rent, then the lease turns into a periodic tenancy. The ‘period’ of the lease will correspond to how rent is paid (eg. weekly or monthly).
Option #3: Negotiate an Extension
If the tenant wants to continue to occupy the premises past the expiry date and has the landlord’s consent to do so, then the parties could negotiate an extension of lease. This extension can be documented by either entering into a new lease, or amending the existing lease using a Deed of Extension of Lease.
However, if the original lease was registered on title and has since expired, whether a deed of extension can be lodged will depend on the requirements of the relevant state titles office. In some cases, an entirely new lease will need to be drafted and registered.
Sometimes mistakes happen, and a landlord may genuinely forget that the lease has expired. Luckily, there are things that can be done to either force the tenant off the premises once the error has been spotted, or negotiate an extension if both parties wish. If you are a landlord with any questions about lease expiry, please do not hesitate to contact me. I am here to help.
DISCLAIMER: This article is for informational purposes only and does not constitute legal advice.