USA – IOWA Law and Practice Contributed by: David M. Erickson, Christopher S. Talcott, Amy S. Montgomery and Shannon M.H. Hasse, Dentons Davis Brown PC
6.19 Right to Terminate a Lease Commonly, the events of default that trigger the landlord’s right to terminate the lease will be numerous. Essentially, the failure of the tenant to comply with any obligation under the lease may give rise to termination. Importantly, how - ever, the type of default will likely determine how the landlord is required to proceed. In a residential lease, the statute dictates what notices must be provided, how they must be provided, when they must be provided and how long the tenant has to cure a breach. Even in the commercial lease setting, there will most likely be different cure periods depending on the breach. For example, it is fairly common for a default in the payment of rent to contain a ten- day cure period, while the breach of any other obligation will afford the tenant 30 days to cure the default. 6.20 Registration Requirements Any lease for a term of one year or more must be memorialised in writing signed by landlord and tenant. Leases of Iowa real estate are not required to be notarised or recorded, and bona fide purchasers are placed on inquiry notice of the rights of any tenant in possession of the real estate. However, it is common in long-term leases or leases containing an option to pur - chase the leased premises to record a memo - randum of the lease to ensure that third parties are bound by constructive notice of the lease. Nominal recording fees are charged for record - ing the memorandum, and are typically charged to the tenant. 6.21 Forced Eviction Tenants in any type of lease may be forcefully evicted if they default in the performance of their lease obligations. For commercial leases, the procedure, types of notices, and timing are
governed almost exclusively by the lease terms. In the residential lease context, there is a very precise set of notices, with specific language, and for which care must be given to the timing and method of service. In either the commercial or residential lease con - text, the procedure will involve a notice served or sent to the tenant apprising them of the breach and providing a set period during which the ten - ant may cure the breach. If the breach is not cured, the landlord may file a civil action for eviction under an Iowa statute which provides for expedited proceedings for evictions. In an ordinary eviction of a residential lessee for non- payment of rent, the tenant may be evicted from the property in as little as two weeks. It is important to note that a landlord may be divested of its right to avail itself of these expe - dited proceedings, if it fails to act within 30 days of the date the cause of action accrued. The exact steps that must be taken in either a com - mercial lease or a residential lease are beyond the scope of this document, and practitioners must make diligent enquiry as to the various statutes at issue. 6.22 Termination by a Third Party Generally, a lease may be terminated by a third party (ie, a person not a party to the lease) only in circumstances involving condemnation or emi - nent domain. In Iowa, the compensation due to a landlord or tenant is determined based on their respective property interests. Damages for condemnation of a leasehold interest are gener - ally measured by the value of the remainder of the lease term in excess of the rent to be paid. Unlike valuation of an interest in fee simple, lost business profits may be taken into consideration in determining the value of a leasehold interest.
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