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Commercial Property Law

Commercial property law deals with land designated for commercial use, including the sale, lease, and use of land of development investment land. Commercial property law is relevant to business and industry in many other sectors; for instance, hospitality, agriculture, and residential development. In addition this field of law intersects and interacts with many others, including planning, construction, environmental, and tax law.


Processes and Transactions in Commercial Property Law


Commercial property law includes a broad range of processes and transaction types, involved in many different property-related issues. The two main aspects of commercial property law are conveyancing—the buying, selling, and leasing of property—and dispute resolution. Within each area there are many related aspects and issues.


Some issues that are covered by commercial property law include:

  • Commercial property leasing

  • Disputes between commercial landlords and tenants

  • Purchase, management, and sale of investment property

  • Residential and commercial development projects

  • Financing purchase or lease of commercial property, and funding building projects

  • Resolution of commercial property disputes via litigation

  • Dispute resolution via alternative methods such as mediation and arbitration


Transactions involved in commercial property law include freehold property transactions, commercial leases, commercial property acquisition and development projects, and option agreements. In addition there are matters relating to these transactions, such as property

valuation, title research, financing, and dispute resolution.


Commercial property conveyancing


Conveyancing is the process by which a property changes hands from seller to buyer. In commercial conveyancing, the seller or buyer may be an individual, or may represent a business or non-profit organisation. Commercial conveyancing typically involves commercial properties such as office buildings, warehouses, and manufacturing plants; however conveyancing of residential investment properties is often dealt with under commercial property law too.


When a property changes hands, the seller, buyer, and their solicitors have some tasks to complete and obligations to meet. For instance, the seller’s solicitor must prepare a sales contract, and the seller must complete paperwork relating to the property. In the meantime the buyer’s solicitor performs a title search, and easements, boundaries, and commercial property standards enquiries, to confirm that the property is suitable for its intended use. The buyer must arrange financing for the purchase, for instance by arranging for a mortgage or for investment funds. This takes a significant amount of preparation in commercial conveyancing, as lenders and investors are concerned with ensuring that the buyer can afford the mortgage even if the business takes a downturn.


Once all of these issues are taken care of the contracts are signed and exchanged. The buyer pays a deposit to the seller, and then pays the balance once a deed of transfer has been signed and approved by the seller.


Commercial property dispute resolution


There are two main ways to settle commercial property disputes: litigation, and alternative methods such as mediation and arbitration.


Negotiation is the most informal method of dispute resolution. In this method the concerned parties or their solicitors attempt to reach an agreement without involving any structured methods or additional parties. This kind of informal method doesn’t always result in an agreement but it does provide an understanding the details of the dispute, and the points of view of all the parties involved.


Mediation is a method of negotiation with a more structured framework, where the parties meet on neutral ground to discuss the dispute and try to reach an agreement. The process is guided by a trained mediator, who helps the parties and their solicitors communicate more effectively. Mediation can be an effective method when both parties are willing to compromise, but because the mediator cannot make a legally binding decision it does not always result in a resolution.


Arbitration is like a private version of the court process, with a professional arbitrator acting in place of a judge. The arbitrator hears evidence from all parties involved in the dispute, and makes a decision as to what should happen to resolve it. The arbitrator’s decision is legally binding, making this an effective method of resolution and a good alternative to the court system.


Litigation is usually an option only when alternative methods fail to achieve a resolution. Litigation is initiated when a claimant files documents with the court. The court sets a hearing date, at which the claimant and defendant each present their case. The case is heard by a judge, who listens to the evidence and then makes a legally binding decision.

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