A lease provision stating that the landlord's CAM reconciliation becomes final and binding if the tenant fails to dispute it within a specified window. This clause can permanently extinguish audit rights for tenants who miss the deadline.
Courts generally enforce binding-and-conclusive provisions as written. However, courts in several jurisdictions have found these clauses unenforceable where the landlord actively concealed information, committed fraud, or where the clause is deemed unconscionable.
A landlord sent the reconciliation by regular mail in late December. The tenant received it January 9. The lease had a 60-day audit deadline and a binding-and-conclusive clause. The landlord argued the 60-day clock started December 28 - the tenant was told their rights were extinguished on $310,000 of overcharges.
Never let your audit deadline approach without acting. If you need more time to complete a full audit, send a written audit notice before the deadline with a reservation of rights.
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Find My OverchargesThis page provides general educational information. It is not legal advice and may not reflect the most current law in your state. Consult a licensed attorney for advice specific to your situation.
