USA – ALABAMA Law and Practice Contributed by: Adam J. Sigman, Crystal H. Walls, Nathan Stotser, Katie Sinclair and Courtney Bradshaw, Dentons
dential context. Non-residential real estate leas - es may include specific restrictions related to the category or use of the leased premises, but such leases are generally not subject to specific regulations or laws due to the use or category of the underlying leased premises. 6.16 Effect of the Tenant’s Insolvency Leases often contain language stating that a ten - ant’s insolvency or the filing of any bankruptcy petition, voluntary or involuntary, constitutes a default under the lease. However, if the lease remained in force at the filing of a bankruptcy petition, the leasehold estate is considered an asset of the tenant, which is protected by the Bankruptcy Code’s automatic stay. 6.17 Right to Occupy After Termination or Expiry of a Lease Generally, a tenant does not have the right to continue to occupy the leased premises after the expiry or termination of a commercial lease. When a tenancy is for a certain period of time and the term expires under the lease, the tenant is bound to surrender possession without the landlord providing notice to quit or demanding possession (Section 35-9-8). If a landlord has terminated the lease for a breach or default, the landlord must give the ten - ant notice of termination at least ten days prior to terminating a commercial lease, unless the lease provides for additional time (Section 35-9-6). If the tenant does not deliver possession of the leased premises after demand, as described above, the landlord may pursue an unlawful detainer action in the district court of the county where the premises are located (Section 6-6- 330). The landlord’s complaint must be served on the tenant at least six days before the hearing date (Section 6-6-332).
If the district judge rules in favour of the land - lord, the court will file a writ of execution, which requires the sheriff to restore the premises to the landlord (Section 6-6-337). The tenant may file an appeal of the judge’s ruling within seven days, and a trial on the appeal is scheduled within 60 days of the date of the appeal (Section 6-6-350). The landlord’s right to possession will not be delayed by a tenant’s appeal, and can only be prevented if the tenant pays all rent payable before the landlord regains possession by a writ of possession (Section 6-6-351). 6.18 Right to Assign a Leasehold Interest Typically, the ability to assign the lease or sub - lease the premises is restricted to a certain extent in the lease, but a tenant generally has the right to sublease the property or assign the lease without the landlord’s consent if the lease is silent about subleases and assignments. If the lease requires the landlord’s consent before subleasing or assigning the lease, the landlord cannot “unreasonably and capriciously” withhold consent (Homa-Goff Interiors, Inc v Cowden, 350 So 2d 1035, 1038 (Alabama 1977)). 6.19 Right to Terminate a Lease In Alabama, provided the remedy is included in the commercial lease, a landlord is typically allowed to terminate the lease for: • failure to pay rent or other amounts due under the lease in a timely manner; • default under the lease (sometimes after a required opportunity to cure);
• violation of applicable laws; and • other terms specified in the lease.
For residential leases in Alabama, by statute, a landlord may terminate a lease by delivering
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