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There is no such thing as a standard lease!

  • South Africa
  • Real estate sector

17-11-2020

Although most landlords will simply provide you their standard lease agreement, it may not be fit for your business purpose and contrary to your intention for concluding the lease. For example, if you are intending on renting a space for retail purposes, you must ensure that the lease agreement does not preclude you from trading or restricts you to certain hours.

An important consideration is the provisions pertaining to the pre-inspection of the premises. The pre-inspection is important because the lease agreement will likely require you to keep the premises in good order and repair and in a clean condition as existed at the commencement of the lease, fair wear and tear excepted. Pay close attention to what fixtures are included in the required repairs as some lease agreements may be more onerous than others. Your landlord cannot, for example, demand that you repair structural defects or place the leased premises in better overall condition than it was in on the commencement date of the lease agreement. It is a good idea to take pictures at the commencement of the lease as proof of the condition of the premises at the commencement of the lease and to prepare and sign a detailed minute of the pre-inspection meeting.

Some lease agreements include warranties and indemnities which should always be closely considered. Be wary of lease agreements that include clauses such as, “landlord gives no warranty and makes no representations in regard to the premises nor does the landlord warrant that the premises will be fit for any purpose”. Another example of a clause that is unduly onerous in terms of our common law is when the lease includes indemnities furnished by the tenant in respect of obligations that would ordinarily be discharged by the landlord.

There is no such thing as a standard lease agreement and it is best to be proactive and seek legal advice before signing a lease agreement so that you don’t have to try and contest the enforceability of certain provisions once the agreement has come into effect.

Peter van Niekerk, Senior Partner

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