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Commercial Lease Issues for Rhode Island Restaurants

The landlord-tenant relationship is one of the most common business relationships in any state.  Each landlord-tenant relationship presents its own unique set of challenges because the specific business operations of the tenant present distinct issues to consider when drafting and negotiating a lease.  This post is the first in a periodic series that will address issues that frequently arise in the landlord-tenant context.  Each of these issues demonstrates the importance of careful and thorough drafting of commercial leases, which can help prevent many disputes that may otherwise arise.  In this post, we address an important issue that is often overlooked when considering restaurant leases:  cleaning and maintenance of the kitchen ventilation system.

Rhode Island is home to a number of superb restaurants.  Given the talent of the students graduating from Johnson & Wales University every year, it is not surprising that many newly minted chefs choose to open their first restaurant in Rhode Island.  Most of these restaurants lease the space that they occupy.  Landlords that lease space to restaurant tenants must address specific issues concerning the safety of the building and compliance with Rhode Island law.  Additionally, restaurant tenants need to be aware of the specific responsibilities they are assuming under the lease and how much it will cost each year to comply with those responsibilities.  Although most leases will provide that a restaurateur-tenant is responsible for complying with state and local regulations governing operation of a restaurant, landlords do not always possess the expertise to inspect the restaurant to ensure the tenant’s compliance.

One significant issue that often is overlooked in the lease is the cleaning and maintenance of kitchen ventilation systems.  Unfortunately, if these systems are not inspected and cleaned on a regular basis, grease fires could erupt, which could result (and have resulted in certain cases) in loss of life and significant property damage.  This issue becomes even more serious if the restaurant tenant leases space in a primarily residential building.

Rhode Island has adopted the National Fire Prevention Association’s Standard for Ventilation Control and Fire Protection of Commercial Cooking Operations (“NFPA #96”).  NFPA #96 states that unless there is a written agreement to the contrary, the owner of the ventilation system bears the responsibility of maintaining the system.  Specifically, NFPA #96 4.1.5 states:

The responsibility for inspection, testing, maintenance, and cleanliness of the ventilation control and fire protection of commercial cooking operations shall ultimately be that of the owner of the system, provided that this responsibility has not been transferred in written form to a management company, tenant, or another party.

Based on the size of the building and the ventilation system, maintenance of the system could require substantial funds over the course of a year.  As a result, it is crucial to negotiate upfront if the landlord or tenant will be considered the owner of the ventilation system and which party will have responsibility for maintenance of the system.  The lease should specify which party is responsible for cleaning and maintaining the system.

It is also important to ensure that the ventilation system is inspected and cleaned on a regular basis.  NFPA #96 A.11.6.2 states that any build-up of grease laden deposits in excess of 0.002 inches must be removed.  As reflected below, NFPA #96 provides estimates regarding actual cleaning frequencies based on the type or volume of cooking:

Commercial Restaurant Lease

In light of the risks to life and property that could result from inadequate cleaning and maintenance, and given the clear requirements of NFPA #96, restaurant leases should expressly state which party owns the ventilation system, which party is responsible for cleaning and maintaining the system, and how often the system must be cleaned.  To document compliance with NFPA #96, the lease should also require that the party who is responsible for cleaning and maintaining the system (1) prepare a certification (or have the contractor that does the cleaning and maintenance prepare a certification) of each maintenance/cleaning service; (2) include in that certification pictures of the cleaned ventilation system; and (3) provide a copy of that certification to the other party to the lease upon request.

Attention to detail with respect to lease negotiation and drafting can be an unwelcome burden and expense.  However, any such burden and expense are heavily outweighed by the potential costs, in both life and property, that could result from inadequate maintenance of ventilation systems.  Addressing the issue at the inception of the landlord-tenant relationship and diligently monitoring the situation throughout the relationship can pay dividends in the form of costs avoided.

About The Author

Hamza Chaudary

I am a litigator who focuses on real estate, land-use and tax appeal matters. I have represented clients before various municipal boards, the Rhode Island District Court, Superior Court and Supreme Court, as well as in the Federal District Court. I have also taught a number of Continuing Legal Education classes on several business law topics.

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