CAM Rent Audits and Tax Appeals
CAM Rent Audits
Tenants who feel they may be the victim of overcharged common area expense pass-through charges under their triple net lease have utilized Silver Law Offices to review its lease and rent invoices, especially following receipt of annual “CAM reconciliation” invoices. We work along with experienced accountants to attempt to recover overcharges.
A recent California case provides that Tenants who don’t demand CAM Reconciliation Statements which contain sufficient detail may be waiving their rights to get one later:
The California Court of Appeal, Sixth Appellate District (San Jose), Tin Tin Corp. v. Pacific Rim Park, LLC (2/2/2009) held that a tenant who accepted a simple one page annual reconciliation statement of common area maintenance charges (“CAM”) over several years, while obtaining some “back up” for certain charges upon request to the landlord, waived their right to a more detailed statement. As many leases do, the subject lease required the landlord to provide a “reasonably detailed statement” of the tenant’s share of CAM expenses incurred during the preceding year. The tenant alleged that the landlord had failed to provide a reasonably detailed annual statement showing each tenant’s actual share of the CAMs. The trial court found that the tenant had waived their right to a more detailed statement by accepting a one-page letter for several years without asking for a more comprehensive statement. The tenant had asked the landlord for more information about the expenses but not for a more detailed statement. The Landlord had then provided a detailed accounting of the charges and, when requested, invoices to support the accounting. The trial court found that the landlord had “substantially complied with the contract requirement” and “given the tenants’ willingness to overlook any lack of detail in the annual letter in favor of access to the source material, plaintiffs cannot now complain that the notices they received were inadequate.”
We have successfully worked along with several expert tax appeal consultants in obtaining an assessed value reduction. This work is done on a contingency fee basis so no fee is paid unless we obtain a lower value assessment for your property. Complex financing arrangements or unusual leases often require us to review the source materials and draft explanations with supporting arguments to back up the reasons why a lower value assessment is called for. We will also review your leases to determine the effect of any tax reduction on your tenants and to be sure that the fee paid to us and/or any consultant for assessment appeals work will be properly borne by the tenants.