When faced with a trouble tenant or other adversary, many commercial landlords and property owners are inclined to rush to court to litigate the matter.  Often, this is the best solution.  However, sometimes it is not.

Certain actions, such as Unlawful Detainer actions, are on a fast track in the court system, which allows for expedited (1) rulings by the court, (2) possession of the premises by the landlord, and (3) money judgment for rent owed.  Just filing the action can get a quick reaction and payment by the tenant.  In these situations, it is often best to move forward with the litigation process, to effectuate a quick result.  However, even here, it is sometimes best not to pursue the tenant all the way through judgment and eviction if that tenant can come close to current on outstanding rent and CAM payments.  Keeping the tenant in place, if it is trying and substantially succeeding in making all payments due, is often better than sitting on empty premises.  This is particularly  true in this market in which the supply of available commercial space for lease outweighs the demand.

On the other hand, especially with all the recent court closures and the concomitant slowing of the judicial system, sometimes filing a lawsuit can be the least efficient manner of trying to resolve a problem.  It can take years to get a case to trial, cost hundreds of thousands of dollars in legal fees alone, and slow productivity of the company as its employees are distracted by having to deal with the litigation (gathering documents from computer servers and email systems for production in discovery, being deposed, responding to attorney inquiries, to name just a few distractions).  If quicker, more effective business solutions can be reached with the other party or parties, I almost always advise my clients to explore those options first.  Particularly where there is an ongoing business relationship, or not much in dispute, reaching an agreement with the other side, rather than battling them in court, is often a faster and more effective manner of resolving the dispute.

Every litigator wants his or her day in court – probably as much as or more so than the client.  In addition, attorneys are ethically bound to be zealous advocates for our clients.  However, a protracted legal battle is not always the best solution for the client, and being a zealous advocate does not mean zealousness to the point of detriment to the client.

When facing potential litigation, my advice is to approach the situation with a clear head, consult with legal counsel, carefully consider all available options, and, of course, be ready to squash the other side to a pulp through litigation if they refuse to be reasonable.  Litigation prevention counseling is not meant to prevent all litigation; rather, it is intended to help prevent clients from commencing or continuing litigation when there is a better viable solution.

As I mentioned in my first posting, I took a survey of the Environmental Bankers Association Membership as to what is and is not a recognized environmental condition.  The results were presented at the Environmental Bankers Association Conference in Utah on June 9th.   The survey results are posted on the EBA’s Website and my website (www.partneresi.com).