A business that leases real estate and improvements (buildings, etc.) in the form of space for offices, a warehouse, a restaurant, a nail or hair salon, a clothing store, a coffee shop, or other commercial (nonresidential) space will usually be required to sign a written contract known as a commercial lease agreement.
If the tenant (the business occupying the space) who signs a commercial lease agreement fails to pay the rent or continues to use the leased premises for a purpose other than as permitted by the lease agreement (after receiving notice of the improper use), the landlord may have the right to terminate the lease and lock the commercial tenant out of the space by changing the locks.
A commercial landlord’s ability to lock a commercial tenant out of the leased premises—sometimes referred to as one of the landlord’s self-help options or remedies because the landlord may be able to exercise these rights without going to court—depends on the specific language in the written lease agreement and the state's contract law.
For example, a state's contract law may determine if any breach of the lease agreement by the tenant was a material breach that might justify an extreme measure such as changing the locks.
Contract law in most states recognizes an implied duty of good faith and fair dealing between parties to a contract, and a commercial landlord who changes the locks on the leased premises because the tenant is a few days late paying the rent may be in breach of the landlord’s implied duty of good faith and fair dealing.
In Tennessee, a commercial lease agreement is a binding contract between a landlord and a business tenant for the rental of nonresidential property, such as office space, warehouses, or retail locations. The terms of the lease agreement will dictate the rights and obligations of each party, including the use of the premises, payment of rent, and conditions under which the lease may be terminated. If a tenant fails to pay rent or uses the property in a manner not permitted by the lease, the landlord may have the right to terminate the lease. Tennessee law allows for 'self-help' remedies, which may include changing the locks to lock out a tenant, but this is contingent upon the specific provisions of the lease agreement and must be done in accordance with the law. The landlord must also act in good faith and with fair dealing, as implied by Tennessee contract law. An action such as changing the locks for a minor or brief breach of the lease may be seen as a violation of this duty. It is advisable for landlords to proceed with caution and consult with an attorney before taking such measures to ensure compliance with the law and the lease agreement.