Quiet Enjoyment – What Landlords Need to Understand

Almost everyone, regardless of whether they have ever leased out or rented a commercial space, is generally aware of each party’s duties under a commercial tenant lease agreement. The landlord allows the tenant to use his building, in exchange for the tenant making rental payments.  But, most people, even experienced landlords, aren’t familiar with the duty to deliver quiet enjoyment, how landlords can find themselves in breach of that duty, and what kind of damages they face if they do breach the duty.  Because the implications for breaching the duty of quiet enjoyment can be severe, all landlords should be familiar with it.

What Is Quiet Enjoyment?

The duty of quiet enjoyment means that the landlord assures the tenant that the landlord holds perfect title to the premises, and the tenant’s possession will not be disrupted.  The duty to deliver quiet enjoyment means that the tenant’s occupancy will not be disturbed by the landlord, anyone claiming the premises by or through the landlord, or someone asserting a superior title to the premises.

For most non-attorney landlords, that definition will be confusing and unclear.  Practically speaking, what the above legal definition means for landlords is that the tenant needs to have a normal, uninterrupted use of the building.  In short, the duty to deliver quiet possession means the landlord can’t take any actions that result in interference with the tenant’s expected, routine usage of the premises.  Factors and issues the landlord can’t control—crime, infrastructure repair by the city—will not constitute a breach of the duty to deliver quiet enjoyment.

The Duty In Action

As an example, one Florida court found that a landlord did not deliver quiet enjoyment to a first-floor tenant, when the landlord was doing such substantial renovations on the floor above the tenant’s space that the tenant could not carry on his normal business.  The repairs were so extensive and ongoing, the court found that they amounted to almost complete destruction of the tenant’s right to do business while the alterations were being performed.  Because the tenant, a clothing retailer, could not engage in its routine business as a result of the repairs, the landlord had breached its duty to deliver quiet possession on the tenant lease.

A more unique twist on this concept came in a case where the tenant alleged a breach of the duty to deliver quiet enjoyment by virtue of the landlord’s provision of security to its strip mall.  In that case, a tenant of the strip mall defended against an eviction by alleging breach of the duty to deliver quiet enjoyment.  When an eviction action as filed against the tenant, it alleged that it was entitled to at least a $21,000.00 set-off of rents because the landlord had hired off-duty police officers as security, who harassed the tenant’s customers.  In finding that tenant had a valid defense to the eviction, the court found that a breach of quiet enjoyment does not have to raise to the level of constructive eviction.  The court further found that the fact that a tenant does not vacate the premises when alleging a breach of quiet enjoyment does not excuse the landlord’s breach of the covenant.

What Happens When A Landlord Breaches Its Duty To Deliver Quiet Enjoyment On A Tenant Lease?

The penalties for a landlord’s breach of the duty to deliver quiet enjoyment can be harsh.  First, the lease itself may provide for damages in the event the landlord fails to deliver quiet possession.  Further, a tenant could be discharged of contractual duties under the lease if the landlord breaches this covenant; that is, the tenant could be able to stop paying rent until the issue creating the breach is resolved, or could potentially terminate the lease all together.  Even worse, the tenant could be entitled to lost profits as a result of the breach in some extreme circumstances.

As is easy to see, landlords should understand the concept of quiet enjoyment, and they breach this important duty at their peril.