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Part one of this post will explain acceleration of rent provisions and how various courts around the country have scrutinized these provisions and taken varying positions on their enforceability. Part two of this post will discuss how landlords can include enforceable acceleration of rent provisions in their commercial leases.

What is an Acceleration of Rent Provision?

An acceleration of rent provision gives the landlord the right, after a default by the tenant, to demand the entire balance of the unpaid rent owed under the lease for the entire remainder of the term to be paid in one lump sum. Under the law of most states, if there is no acceleration of rents provision, the landlord is typically entitled only to collect rent from the tenant as it becomes due under the lease each month for the remainder of the term.

Winding down our update of the first round of Case Watch opinions, the Virginia Supreme Court has finally released its long awaited decision in Tir Conaill Properties, L.C. v. 2401 Wilson, LLC, Record Number 090855. Although the opinion is quite short at only three pages, it is chock full of warnings to the unwary litigator.

This case involved a commercial lease dispute between Tir Conaill Properties, L.C., the tenant, and 2401 Wilson, LLC, the landlord. The day before trial, 2401 Wilson filed a pre-trial memorandum, arguing for the first time that Tir Conaill’s complaint should be dismissed because it failed to file a certificate for transacting business under an assumed name as required by Virginia Code Section 59.1-69 (A).