Termination of Lease

by Ulla Weimann
(Toronto, ON, Canada)

I have a five year lease for an office suite in Downtown Toronto which started in Nov.09. I payed over $7000.00 for renovation which was done by the landlord. The building has been sold and the new owner send an estoppel notice stating that I will receive 6 month notice should the building be demolished. I am asked to sign this note. Should I sign? Do I have any other options? Do I have a right to be compensated for my expenses if I cannot use the office for the minimum of five year?

Answer.

You should never sign an estoppel agreement without getting legal advice. If you do you can sign away rights that you had under your original lease. So in my opinion you do not have to agree to this clause in an estoppel agreement as it changes the lease that is still in effect.

Otherwise any landlord could negotiate a lease and then just have it changed by getting a tenant to sign an estoppel agreement.

And yes you should be compensated if the building is demolished but not just only for your improvements but for other costs as well.


A better course would be under legal guidance to strike out this clause. If the new landlord decides to demolish the building - at that time you could negotiate a much more generous settlement.

You do not have to agree to anything that alters the original rights you have under the existing lease.

If you need a reference to an expert who can help you with this in Toronto, give me a call. If you use an attorney make sure that he or she is a specialist in commercial leases not a general lawyer.