The Print and Visual Communications Association (PVCA) has negotiated a business review package for members as increasing numbers of print and packaging operators seek assistance on lease re-negotiation and insurance guidance due to COVID-19.
This service, delivered through PVCA’s print and packaging industry focused legal team, is designed to assist tenants in the negotiation process with landlords, including requests for reduced rent on current leases.
It is also designed to help business owners review current insurance policies to ensure they are adequately covered.
It comes after the federal government announced a mandatory code for landlords and tenants which set a framework for the deferral or reduction of rent during the coronavirus period based on “good faith” leasing principles.
“The prime minister has made very strong statements that landlords and tenants need to work together to get through the next six months,” the PVCA said.
“Without any definitive mandate from government, it has been left up to the market to negotiate amended terms for an intervening period.
“If such negotiations are not properly considered and noted in light of the other clauses within the existing and respective lease documents and insurance policies, then it may give rise to void of cover under existing insurance policies or provide for significant disputes, misunderstandings and claims once we are all out of these COVID-19 restrictions.”
With landlords and tenants renegotiating leases in the short-term, irrespective of any current lease documents being in place which already define the terms of the lease, this could mean that tenants may be excused from having to pay rent depending on the wording used in a given lease.
“Commercial leases often contain clauses whereby either the landlord or the tenant will not be required to perform their obligations in a lease due to external circumstances,” PVCA said.
“In some leases, this clause could also allow a tenant to walk away from their lease without financial penalty, leaving premises vacant for prolonged periods. It also may give rise to landlords bringing leases to an end. These are the very reasons why it may likely be prudent to being open to a renegotiation of some of the terms of a lease, but only for a defined period of time.
“The important thing, is to ensure that such renegotiated terms are carefully considered, that insurance policies are factored into the equation and that all of it is properly drafted into a document for a defined period of time, subsequent to which all terms revert back to the way they were pre-crisis.”
For members of PVCA, the association’s print and packaging industry legal services team at PTW Law are offering a flat fee of $500 + GST to perform a lease review, provide initial advice on rights and obligations and draft and provide the initial letter for tenants or draft and provide the initial response letter for landlords.
PTW Law is also offering a flat fee of $50 + GST to perform a review of PVCA members’ insurance policies to provide an initial verbal advice on what the member is covered for.
“We are noticing an alarming rate of members who are either not insured for what they thought they were, or are in fact significantly underinsured,” the association said.
“That is, now that such policies are called upon, it is becoming evident that people have had a false sense of protection, be it for a tenant not being able to cover rent, business interruption insurance, building insurance and many others.”
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