Commercial and industrial real estate transactions usually involve a web of complex legal issues. A written contract is the foundation of every real estate deal whether it provides for a lease renewal, sale, purchase of real estate, or a complex real estate development-financing proposal.
Writing a contract for commercial and industrial real estate transactions is an extremely meticulous process. Often, a simple error can lead to problems. A misplaced punctuation symbol or incorrect terminology can put a contract into a legal dispute that can cost a significant amount of legal fees to resolve. Avoiding litigation arising from avoidable mistakes is the task of an experienced attorney with years of experience in commercial and industrial real estate transactions. In addition to the California statutes that govern contracts, California courts have established an abundance of case law rulings that have the force and effect of laws.
A properly drawn and executed contract or lease containing all of the mutually acceptable terms is very necessary in the conveyance of property and in complex financing arrangements. The failure to understand contract and lease terms and the statutes that govern the development of contracts and leases leaves the buyer vulnerable to various types of liability issues.
The importance of the contract is that it is a binding agreement and a party’s ignorance of the meaning of the contract or lease provisions will not be a defense in court. Parties to such agreements should recognize that these are voluntary agreements promise to do something in exchange for a promise by the other party to do something in return.
Attorneys who are experienced in commercial and industrial real estate transactions employ a variety of tools such as language and format devices to craft a document that fully states the obligations of all parties and the remedy for non compliance or other issues that may arise.
Litigation can be avoided by creating a contract or a lease that is clear enough to state the expectations of all parties, and the value that is to be exchanged or the actions promised is clearly stated, and the evidence that authorized parties have agreed to the terms.
If you are presented with commercial and industrial real estate transactions in written formats, then it is equally important that these contracts are reviewed by an experienced attorney.
Disclaimer: This article is intended to provide a general summary of laws in the State of California and should not be construed as a legal opinion nor a complete legal analysis of the subject matter. Noelle Minto is an attorney at NM Law, APC in Tustin, California, a law firm specializing in Trusts & Estates and Business Transactions.