February 2021 Commercial Eviction Update

Posted by Katherine M. Silverman on

When a commercial tenant defaults on its lease obligations in Georgia, the commercial landlord’s typical remedy is to file a dispossessory (eviction) action. Historically, the dispossessory process has been an efficient method to re-gain possession of a commercial property.

Currently, the COVID-19 pandemic has upended the process to evict the tenant. Residential eviction moratoriums and emergency public health orders caused confusion, even in commercial eviction proceedings. For a few months, Marshals in some metro-area counties were refusing to conduct any evictions – residential or commercial.

Commercial Eviction Actions
Now that we are nearly a year into the pandemic, most Atlanta-area court systems have resumed commercial eviction actions. On September 4, 2020, the Centers for Disease Control published an Eviction Moratorium. Notably, the moratorium does not cover commercial evictions or excuse a commercial tenant from paying rent.

Most metro-area courts have specific guidance on their websites, including:

The first step in the commercial eviction process that every landlord should take is to thoroughly review the lease agreement. Many commercial leases provide a specific procedure to notify a tenant of a default, and potentially provide the tenant with a right to cure the default. If the tenant does not cure during the cure period, the landlord’s next step is to send a follow-up letter unequivocally demanding possession of the premises. A demand for possession is a mandatory prerequisite to a commercial eviction proceeding.

The landlord also needs to evaluate whether it wants to terminate the lease. Depending on the language in the lease, the landlord may have the right to terminate the tenant’s possession of the premises, leave the lease in effect, and continue to charge rent. However, there are some specific legal nuances to consider that are beyond the scope of this blog post.

The next step is to file a dispossessory proceeding in the county where the commercial property is located. The affidavit and summons must be served on the tenant. The tenant has seven days from the date of service to file its answer. If the tenant fails to file an Answer, the landlord may be entitled to a writ of possession – basically an order that the tenant is to be evicted – without need for a hearing.

If a hearing is required, the court will send the parties a notice with the date and time. Most hearings are still being conducted virtually, via video-conference. If the landlord prevails at the hearing, the court will issue a writ of possession.

Once the landlord receives the writ of possession, the landlord contacts the Marshal’s Office to schedule the eviction. The Marshal may have additional guidelines and procedures to evict a commercial tenant during the COVID-19 pandemic.

If you are a landlord or a tenant and you need legal advice regarding your rights and responsibilities under your commercial real estate lease, please reach out to me.