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If You Should Find Yourself Disputing CAM Charges ...

Posted: February 18, 2008 8:00 p.m.
Updated: April 19, 2008 5:02 a.m.
 
The conflict between a business owner and a commercial property owner over so-called CAM charges offers a number of points of advice and locations for assistance for others who could find themselves in the same situation:

* Russ Furie, who won his case against Octagon Plaza: "I would tell people now don't ever get into a lease that gives up your right to verify (the landlord's) accounting," said Furie said.

He also suggests that future tenants of a center get an idea of the property's history with charging the tenants.
"I think knowing the history of the landlord's billing the tenants is a very big thing," he said.

* David Delawder, small business consultant: The city hosted a small business seminar in April 2007 to address the concerns many companies had about the common issues that include lease agreements, financing and rent.

One topic was CAM charges and rent increases, which was discussed by David Delawder, a small business consultant.
He believes that when it comes to leases, it's necessary for tenants to sit down and go over the agreement so they understand what they can be charged for.

He points to the "specific verbage" of a contract as a way to understand how the charges will be issued. For example, "actual expenses incurred" is a specific phrase that has a different meaning that just basic expenses.

* Delawder: Communication is another key point. "I tell people that before you have the lease, talk to tenants and even ask the landlords questions," he said.

* Chris Jacobsen, an attorney for Poole & Shaffery, LLP: At the same conference, Jacobsen explained that the biggest problem tenants have is that when they sign the lease, they don't actually look at the agreement.

"I think what ends up happening is that the tenants end up focusing on monthly rent charges and don't look at the history of CAM charges," he said.

To avoid this, it's best to be educated as a tenant and understand what the agreement is. He reminds small business owners that landlords are typically preparing agreements, and they are often done in their favor.

* Paul De La Cerda, director of the Small Business Development Center: De La Cerda says an important part of lease agreements is the type of relationship a business owner develops with his or her landlord.

As for preventing problems with the lease and any of its details, De La Cerda said resources like the development center can help businesses look over leases. In some instances, meeting with an attorney can be an option.

He finds it key for a business owners to not only ask questions of their prospective landlords, but for the landlord to ask question of the company that wants to move in.

"It's just like a marriage," he said, noting that it involves two people coming together to commit to a contract.

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