Casualty Damage Repair Obligation Provision

A Casualty Damage Repair Obligation Provision is a condition-triggered obligation provision whose condition trigger is casualty damage event and whose contractual obligation is a casualty repair obligation.

• Context:
  • It can (typically) have a Condition Trigger of Casualty Damage Events (fire, storms, or other common natural disasters).
  • It can (often) place the primary responsibility on the lessor.
  • It can (often) be found within Real-Estate Lease Agreements, particularly in sections dedicated to Damage and Destruction Clauses or Maintenance and Repair Obligations.
  • It can range from requiring Minimal Repairs to demanding complete rebuilding of the premises.
  • It can affect the calculation of rent, where rent may be reduced or abated during the period of repair depending on the extent of the damage and the impact on the usability of the premises.
  • ...
• Example(s):
  • “Upon casualty damage_{(Triggering Condition, Casualty Damage)}¹, the Lessor is to begin and continue repairs to the Leased Premises_{(Primary Obligation, Lessor Obligation, Repair Obligation)}² in a timely and thorough manner_{(Manner of Performance)}³, with the aim of restoring to its prior condition_{(Restoration Standard)}⁴." Casualty Damage Repair Provision, Four-Element Provision.
  • “In the event of damage not resulting from lessee's negligence_{(Triggering Condition, Non-Lessee Caused Damage)}¹, lessor shall repair such damage_{(Primary Obligation, Lessor Obligation, Repair Obligation)}² as quickly as reasonably possible_{(Manner of Performance, Reasonable Speed)}³ at lessor's expense_{(Repair Cost Allocation, Lessor Expense)}⁴, and rent shall be abated proportionally to the degree to which the damage interferes with the lessee's business_{(Rent Abatement, Proportional Abatement, Business Interference Standard)}⁵." Casualty Damage Repair Provision, Five-Element Provision.
  • “If the premises are damaged by fire or other casualty_{(Triggering Condition, Casualty Damage)}¹, the lessor shall restore the premises_{(Primary Obligation, Lessor Obligation, Restoration Obligation)}² unless the repairs cost more than 25% of the building's value_{(Repair Cost Threshold, Percentage of Building Value)}³, in which case either party may terminate the agreement_{(Termination Option, Mutual Termination Right)}⁴." Real Estate Lease Casualty Damage Repair Provision, Four-Element Provision.
  • “Upon occurrence of any casualty damage_{(Triggering Condition, Casualty Damage)}¹, the Lessor shall promptly commence and diligently proceed with the repairs necessary to restore the premises to their pre-casualty condition_{(Primary Obligation, Lessor Obligation, Restoration Obligation, Pre-Casualty Condition Standard)}², unless restoration costs would exceed a reasonable percentage of the property's value_{(Repair Cost Threshold, Reasonable Percentage of Property Value)}³, in which case the lease may be terminated by either party_{(Termination Option, Mutual Termination Right)}⁴." Casualty Damage Repair Provision, Four-Element Provision.
  • “If a casualty event renders more than 50% of the premises untenantable_{(Triggering Condition, Casualty Damage, Untenantability Threshold)}¹ and occurs during the final year of the lease term_{(Timing Condition, Final Lease Year)}², either party may terminate the lease_{(Termination Option, Mutual Termination Right)}³ unless the landlord completes the repairs within a specified shorter period_{(Repair Completion Deadline, Shortened Repair Period)}⁴." Casualty Damage Repair Provision, Four-Element Provision.
  • “The landlord will restore any damage from casualty events_{(Primary Obligation, Landlord Obligation, Restoration Obligation)}¹ unless the restoration costs exceed a set threshold of the property's insured value_{(Repair Cost Threshold, Percentage of Insured Value)}², in which case the landlord can elect not to rebuild and terminate the lease_{(Termination Option, Landlord Termination Right, No Rebuild Election)}³. The tenant may also have the option to terminate if the restoration is not completed within a predetermined timeframe_{(Termination Option, Tenant Termination Right, Restoration Completion Deadline)}⁴." Casualty Damage Repair Provision, Four-Element Provision.
  • ...
• Counter-Example(s):
  • General Maintenance Clauses, which deal with regular upkeep and minor repairs, not damage from unforeseen casualties.
  • Operative Clauses involve activating certain contract features but do not specifically address damage repairs.
  • ...
• See: Lease Agreement, Damage and Destruction Clause, Maintenance Obligation, Rent Abatement Clause, Property Insurance Clause.

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