The Dirt Dictionary: N Is For Notices
By Jeffrey Margolis November 27, 2013 7:00 amreprints
From the mundane notice concerning window cleaning to a notice of default for nonpayment, the boilerplate notice clause in the lease has to be strictly followed to make the notice effective.
Two of the biggest challenges leasing lawyers face is determining when to give an effective notice under a lease and determining when that notice is deemed given.
The consequences are of obvious import when the notice in question relates to a tenant default or a dollars and cents issue like a rent commencement date keyed off a notice that landlord’s work has been substantially completed.
This is one of those boilerplate clauses often ignored or glossed over.
Objectively, the notice provision is analyzed in three parts: who gets it, how must it be sent and when is it deemed delivered (given).
The overview is to incorporate a method of giving notices which assures receipt –either actual or constructive (deemed). In the not infrequent case where a tenant in trouble has moved, the deemed receipt aspect is of particular importance to a landlord seeking to send, for example, a lease termination notice.
Many landlords rely on the Real Estate Board of New York form. Art 28 has a two-prong scheme: notices from landlord to tenant, and notices from tenant to landlord. The notice to tenant must be in writing and delivered to tenant personally, sent by registered or certified mail or left at the premises. It is deemed given when so delivered or mailed or left at the premises.
The protocol is much tighter when the notice is going from tenant to landlord: the only acceptable method of delivery is registered or certified mail. Sounds OK –it is after all the REBNY form.
From a tenant’s point of view, that an important notice can simply be “left” at the premises –with anyone who answers the door — is an important deficiency to be addressed by counsel.
(One nightmare scenario here is a three day default notice given on the first of the month which is deemed given when mailed but which is sent by certified mail and not actually received by tenant until the 4th of the month, thus leaving tenant with zero days to cure.)
In the modern, better thought out iteration of the notice clause, delivery by overnight carrier (FEDEX, etc.) is also contemplated with deemed delivery to be the following business day. Best practices to assure that a responsible party will actually see the notice include specifying the title of the recipient and providing for a copy of all notices to go to counsel (landlord’s lender, too, if required).
Practice Pointer: Some landlord’s may balk at being required to notify tenant’s counsel so a workaround is to limit that requirement to default notices. Additionally, if there is an emergency (a sandy, for example) then prudent to provide for a means of notice including fax, telephone and email, with any of those alternatives to be backed up (post-emergency) with a certified mail or overnight courier delivery—one providing for a confirmation of receipt.
As to e-mail notices, the parties are free to provide that alternative, but the suggested best practice there is to specify in the lease an electronic notification address at which the party agrees to accept service of notices. Of course as to e-mail notices beware the steroid enhanced spam filter.