How a Business Hired a Lawyer to Review a Ground Lease in Arizona

Can a ground lease be terminated early by the lessor if the lessee violates a non-monetary covenant?

I am currently in a ground lease agreement where I am the lessee, and I recently received a notice from the lessor stating that they intend to terminate the lease due to a violation of a non-monetary covenant. The specific covenant in question pertains to the maintenance and upkeep of the property. I have been diligently maintaining the property, but there may have been some minor lapses in the past. I would like to know if the lessor has the legal right to terminate the ground lease early based on a non-monetary covenant violation, and what options I have to defend against this termination.

Damien B.

Answered Jan 30, 2025

Hello: The success of a claim of breach of the agreement depends on whether the alleged violation of the specific non-monetary covenant is material and whether there is a right to cure it. If it is a minor or curable breach, and the lessee can cure it, then the lessee may have defenses to an alleged breach claim.