A Lease Restriction That Actually Binds
Posted September 27, 2026 in Commercial Litigation
Restrictive Covenants Shape What Happens Inside A Building
Class A commercial properties often include a detailed set of restrictive covenants governing everything from exclusive use rights to signage, parking allocation, and permitted business activities within the building. These provisions exist to protect the value and character of the property, and a breach by either a landlord or a tenant can create real financial consequences for the other party, sometimes long after the original lease was signed and the parties involved have changed.
What Counts As A Breach Of A Commercial Covenant
A breach can take several forms depending on which party is accused of violating the agreement, and the remedy available often depends heavily on which category the alleged breach falls into.
- A landlord leasing to a competing business despite an exclusive use provision
- A tenant operating a business outside the permitted use clause in its lease
- Violations of building-wide signage, parking, or common area use restrictions
- A party failing to maintain standards required under a reciprocal easement agreement
Exclusive Use Clauses Generate Frequent Disputes
An exclusive use clause generally prevents a landlord from leasing space to a business that directly competes with an existing tenant, and disputes often arise over how broadly or narrowly that competing use gets defined. A Denver Breach of Class A commercial covenant typically starts by comparing the language of the exclusive use clause against the actual operations of the new tenant, since the outcome frequently comes down to specific wording rather than general fairness or what either side considers reasonable.
Proving Damages Requires More Than A General Complaint
Colorado courts generally expect a party alleging breach of a commercial covenant to show actual financial harm resulting from the violation, not simply that the covenant was technically broken. Lost revenue records, comparable lease terms from similar properties, and outside testimony on market impact often become central to establishing the real cost of a breach, since courts are reluctant to award damages based on speculation alone.
Remedies Available When A Covenant Gets Broken
Depending on the lease and the nature of the breach, remedies can include injunctive relief requiring the offending party to stop the violation, monetary damages for losses already suffered, or in some cases lease termination rights for the non-breaching party. Volpe Law LLC can help determine which remedy actually fits a specific situation, since pursuing the wrong one can waste time on a claim that a court is unlikely to grant, delaying resolution of the underlying dispute.
Notice And Cure Provisions Often Come First
Most commercial leases require a party to provide written notice of an alleged breach and an opportunity to cure it before litigation can begin, and skipping this step can delay or even derail an otherwise valid claim. Reviewing the exact cure period and notice requirements in the governing lease is one of the first things that needs to happen before any formal dispute moves forward, since a court can dismiss a case filed too soon.
Building A Record Before A Dispute Escalates
A Denver Breach of Class A commercial covenant can help a landlord or tenant document a suspected breach thoroughly from the start, since a well documented record makes both settlement negotiations and, if necessary, litigation considerably more effective. Photos, correspondence, and a clear timeline of when the violation was first noticed all strengthen a case well before it ever reaches a courtroom.
Talk Through A Covenant Dispute Before It Grows
Covenant disputes tend to get harder to resolve the longer they sit unaddressed, since positions harden on both sides once formal accusations start flying. If you believe a covenant in your commercial lease has been violated, or you have been accused of violating one, reach out to us and let’s review the lease language together before the dispute gets any further along or costs either side more money than it needs to.