Don’t Rely on Oral Request to Renew Lease

Don’t Rely on Oral Request to Renew Lease

Specific provisions are negotiated for and included in your lease for a reason: You and the owner have, for whatever reason, agreed that those terms work for both of you. It’s common for leases to specify how and when you will need to exercise certain rights. For example, when renewing your lease you’ll probably have to exercise that right by a certain date using a certain method. Don’t make the mistake of trying to exercise your lease rights in some other manner like the restaurant tenant in a recent Texas case.

There, the tenant approached the owner of the space it rented to discuss renewing its lease. It orally requested a renewal, but didn’t put the request in writing, as required by the renewal provisions in its lease. Later, when the owner refused to renew the lease, the tenant sued. A trial court ruled in favor of the owner. The tenant appealed.

A Texas appeals court upheld the decision in favor of the owner. The appeals court said that it was undisputed that the tenant orally told the owner that it wanted to renew the lease, but there wasn’t sufficient evidence that the owner accepted the oral renewal and waived the lease's written notice requirement. Additionally, because the tenant was in default of the lease's terms at the time of renewal, it didn’t have the right or option to renew the lease based on the terms of the renewal provision anyway [Lucy Merk, LLC v. Greenville Landmark Venture, Ltd., August 2014].


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