When is a commercial lease so unbalanced, so unfair, or so unreasonable that it is unenforceable? Not often. The California Court of Appeal, Second Appellate District Court, recently upheld a lease provision allowing the landlord to charge 150 percent of base rent as “holdover” rent if a commercial tenant did not timely vacate the premises in Constellation-F, LLC v. World Trading 23, Inc., 45 Cal.App.5th 22 (2020).
The provision is common in commercial leasing—so common that many preprinted commercial lease forms include it automatically. In Constellation-F, the California Court of Appeal examined the practice, finding it enforceable over a strong dissent.