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Commercial Tenants' Audit Rights

If you do not trust your landlord to charge you a fair amount of rent, there is no way for you to know if the operating expense numbers reflect reality unless you have the right to check. You would need a clause in your lease agreement giving you the right to hire a professional auditor to review the landlord's books, known as an audit right.

An auditor looks for mistakes, accidental or deliberate, including any failure to remove an expense the landlord has been reimbursed for. In this way, an audit right in your lease can suave you possibly hundreds, even thousands of dollars.

You landlord will probably contest your petition to be given audit rights. If this is the case, you can point out that if you have reasonable suspicion that you are being overcharged, you can take action. You can protest the charge, refuse to pay, and file a lawsuit. If you proceed to litigation, you will have the right to examine the landlord's books.

Even if you are not suspicious of being overcharged, you should invest the money to look over what you are being charged for if you can afford it. In this way, you can send a message to your landlord that you take your rights seriously. The best time for your first audit is the end of your first year of residence. This is because your first year is regarded as the "base year" against which all subsequent costs can be measured.

If you believe you are being unfairly charged, speak with our New York City real estate litigation attorney who can push for your rights. The Law Office of Steven R. Sutton can represent you if your case moves to arbitration.