Promised Improvements

Case 1

            There are times when a landlord may agree to make improvements to secure a rental or lease agreement.  If the landlord fails to make these changes in a timely manner, then the renter of the person leasing the property may cancel the lease or rental agreement.  

Let’s say John is a horse trainer and the landlord agrees to build a horse barn and a trainer corral. John moves onto the property but after 4 months the corral isn’t put together and there has been no action concerning the barn. (Note: be sure that no action does include the filing of plans and issuing of permits. The time it takes to be issued permits since covid has grown into be ridiculous. And without the approval from the proper authority the landlord’s hands are tied.)
The landlord has obligated him or herself into building the barn and erecting the corral which are necessary for John to earn a living.

John can cancel the agreement because of the landlord’s failure to preform and he needn’t be concerned about any future payments once he’s surrendered the property back to his landlord.

Case 2

Because of the superior location and the strong desire to operate from the property a tenant may agree to make or cover the cost of certain improvements. It could be a simple improvement as Painting a structure or as complicated as build a structure. In these cases, the agreed upon time period for starting the improvements should be listed in the lease but if it is not then the law gives it a reasonable period of time.

Let’s say the tenant has remained until the time of his leases expiration but has not completed all the improvements they have agreed to perform. He then moves out and surrenders the property without making the agreed upon improvements. The landlord takes him to court and demand the improvements be made or that he is given the cost to make those improvements. Will his demand hold up in court.

Most likely Yes because the improvement was agreed to in exchange for rent.

Case 3

Often a landlord gives their consent to improvements with the provision that the landlord must approve the improvements. Let’s say the tenant has in the past made some improvement to which the landlord gave consent but now the tenant wishes to make an improvement which will encroach on another portion of the property and the landlord says no, you may not proceed to build it. The tenant and landlord try to find mutual ground and after 2.5 years the land lord declares a forfeiture of the lease. The tenant is upset because the landlord has always accepted his rent payments. The tenant tries to claim the landlord lost that ability when he excepted his rent payments.

The tenant is incorrect and is not entitled to a reimbursement for the cost of his improvements because they became part of the real estate. The tenant does have the option to persuade the owner to sell the property to him or her.

Note: Images on this blog site are from a free source or taken by the author. No image or group of photos is intended to represent the people the author serves. The author does not care about Race (that is a politically correct term that he does not like because we are all of the same Race, the Human Race. He prefers the term ethnicity, color, religion, sex, gender, marital status, disability, genetic information, national origin, source of income, Veteran or military status, ancestry, citizenship, primary language or immigration status.) He is a service provider for all people. We will all rise together when we band together and help one another. Joseph Erwin is a Real Estate Broker, DRE # O2131799, and a CA general contractor # B 696662. He’s a member of the CRMLS and The East Valley Association of Realtors located in the Inland Empire region of Southern California.