Caution To Landlords: Calif. Nonwaiver Clauses Revisited

Law360, New York (January 27, 2015, 9:09 AM EST) -- Historically, California landlords have taken refuge in the protections afforded by including a nonwaiver clause in their leases. The nonwaiver language provides that acceptance of rent after knowledge of a breach under a lease covenant will not be deemed a waiver of that breach by landlord. Under most circumstances, courts will enforce such nonwaiver provisions. (See Karbelnig v. Brothwell (1966) 244 CA2d 333.) However, there are exceptions to this rule that can leave landlords without the protection they expect. As one court stated, "[e]ven a [non-] waiver clause may be waived by conduct." (See Bettleheim v Hagstrom Food Stores Inc. (1952) 113 CA2d 873.) There are exceptions to the general protections afforded by a nonwaiver clause, along with competing theories that may be raised by a tenant, including: (1) not all breaches of lease obligations are covered by the nonwaiver clause, (2) some waivers may apply permanently not just to prior breaches by a tenant, (3) the courts may resort to the doctrine of estoppel in denying the landlord the right to enforce a lease term, and (4) the lease may have been orally modified. It is important to understand these limitations in order for a landlord to effectively preserve or enforce its rights under its leases....

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