Understanding Your Commercial Lease Agreement

A commercial lease agreement outlines the terms set between a commercial tenant and a landlord when renting a space. A commercial lease agreement includes important details such as rent and duration. A business owner may own the property on which they operate their business; however, they can also rent the property from a landlord. A commercial lease agreement is similar to a residential lease agreement; however, there are key differences. Instead of residents occupying the space, the rental property is used to conduct business. Additionally, residential leases typically operate with monthly payments or annual payments, whereas commercial leases usually operate with an annual payment dependent upon the size of the property. For assistance with a commercial lease, contact one of our Edmonton commercial real estate lawyers.

Types of Commercial Lease Agreements

Gross Rent Lease

For a commercial gross rent lease, the landlord includes the rent and other fees that may be associated with the property, such as, but not limited to, utilities or taxes in the rent cost.

Modified Gross Lease

For a commercial modified gross lease, the landlord includes the rent in the rental cost but does not include all of the other fees associated with the property, such as, but not limited to, utilities or taxes. These fees are split up between both the tenant and landlord in a modified gross lease.

Net Leases

A net lease is a lease agreement between a landlord and tenant in which the tenant pays rent to the landlord and is also responsible for some or all of the other costs associated with the rental property.

Single Net Lease

A commercial single net lease agreement indicates that the tenant pays rent plus one of the other costs associated with the rental property independent of the landlord, which could include property tax, insurance, utilities, or other costs.

Double Net Lease

A commercial double net lease agreement is similar to a single net lease, but instead of the tenant paying for one of the other costs associated with the rental property independent of the landlord, the tenant pays for two which could include property tax, insurance, utilities, and/or other costs.

Triple Net Lease

A commercial triple net lease agreement is similar to a single and double net lease but instead of the tenant paying for one of the other costs associated with the property independent of the landlord, the tenant pays for all of the other expenses, including property tax, insurance, utilities, and other costs.

Commercial Tenancies Protection Act

During the COVID-19 pandemic, Alberta implemented the Commercial Tenancies Protection Act due to the impact the pandemic had on business owners. Regarding lease agreements, this regulation protected business owners against having their commercial lease agreement cancelled or having rent increases/fees for a failure to pay rent due to COVID-19. This protection ended on August 31, 2020.

Important to note, commercial lease agreements differ; therefore, the types of agreements discussed in this blog are just examples of what a lease agreement could look like. A commercial real estate lawyer could help you to better understand a lease agreement.

Contact Verhaeghe Law Real Estate Lawyers for Advice on Commercial Lease Agreements.

Verhaeghe lawyers have been proudly serving Edmonton’s communities for decades with commercial leasing agreements. Contact our commercial real estate lawyers for more information.

*Disclaimer: Please note the content prescribed in this article is only intended to act as a general overview on a legal topic. For specific legal guidance regarding commercial lease agreements, we recommend you consult with a commercial real estate lawyer for legal advice as each situation is unique.

Joint Venture Restructuring, What You Need To Know

When two or more parties decide to start a business together for a specific project or intention, they have formed a joint venture. It is important to note that Canada does not define joint ventures in the Income Tax Act; this leads to people confusing a joint venture with a partnership. For clarification regarding joint ventures, contact one of Verhaeghe Law Office’s Edmonton corporate lawyers.

Partnership vs Joint Venture

A joint venture occurs when two or more parties come together for a particular, specific business project or intention, which can be short-term or long-term. Individuals participating in a joint venture typically conduct other business outside of the venture. The joint venture is a separate business from an individual's other businesses. A partnership, on the other hand, involves two or more parties coming together for an ongoing business intention that is not limited to a specific project. A joint venture can be carried out as a partnership as defined in Alberta’s Partnership Act, but it can also be carried out as another form of business structure such as a corporation and more.

Partnership

A partnership occurs when two or more individuals work together to split both the profits and the losses of a business. A partnership must be registered with Alberta’s business registry.

Limited Partnership

A limited partnership is a partnership in which different partners have varying responsibilities and liabilities based on their contribution to the business. Unlike a partner in a partnership, a limited partner is usually only liable for the amount they have contributed to the business. For a partnership to become a limited partnership, the business must be registered with Alberta's business registry as a limited partnership.

Limited Liability Partnership

Similar to a limited partnership, a limited liability partnership protects an individual from being liable for another partner’s negligence in business operations. For a partnership to become a limited liability partnership the business must be permitted as an eligible profession and registered with Alberta’s business registry.

Corporation

A corporation separates an individual from their business. This means that an individual's personal assets are considered separate from the company’s assets. To incorporate a business, the owner is required to register the business as a corporation on Alberta’s business registry.

Joint Venture Agreement

A joint venture agreement is a document that describes each partner's roles and responsibilities in the joint venture. This agreement typically differs from a contract in a partnership.

This article is not an exhaustive list of the different types of business in Canada and does not encompass the entirety of what a joint venture entails.

Contact Verhaeghe Law Corporate and Commercial Lawyers for Advice on Joint Venture Restructuring.

Verhaeghe Law Office’s Edmonton corporate lawyers have been proudly serving Edmonton’s communities for decades on joint venture restructuring and more. Contact our corporate and commercial lawyers for more information on joint venture restructuring.

*Disclaimer: Please note the content prescribed in this article is only intended to act as a general overview on a legal topic. For specific legal guidance regarding joint venture restructuring, we recommend you consult with a corporate and commercial lawyer for legal advice, as each situation is unique.

Mergers: legal implications when consolidating your entity

Both mergers and acquisitions are mechanisms used to combine two corporations together. In the case of a merger, or amalgamation, two corporations get together and continue their combined operations as a new, third entity. In an acquisition, one corporation purchases the other and absorbs the resources and functions of the purchased corporation.

Both Alberta’s Business Corporations Act and the Canada Business Corporations Act use the term “amalgamation” rather than “merger.” Businesses can be incorporated under either federal or provincial legislation, so the procedures for merging two or more businesses may vary depending on which legislation applies.

Benefits of merger or amalgamation

What are the possible benefits of merging your business with another? There are a number of reasons for amalgamating two corporations, including:

• combining complementary resources, products or services to improve the client experience
• improving efficiency and lowering overhead expenses
• obtaining access to a new market or geographical area
• scaling up the manufacturing processes
• avoiding duplication of services.

If you are not sure whether an amalgamation is the best move for your business, our corporate and commercial lawyers are here to help you understand mergers and the legal implications when consolidating your entity.

Short-form and long-form amalgamation

A long-form amalgamation requires the two corporations to sign an amalgamation agreement, which must be approved at a shareholder meeting. The amalgamation agreement sets out the terms of the proposed amalgamation and must contain specific provisions. If the proposal is approved by the shareholders, the articles of amalgamation of the new corporation must contain the provisions that were agreed on as set out in the amalgamation agreement.

A short-form amalgamation is only available to related corporations that wish to merge. A vertical short-form amalgamation can take place between a holding company and a wholly-owned subsidiary. A horizontal short-form amalgamation can take place between two or more wholly-owned subsidiaries of the same holding company. These amalgamations can often be done quickly and easily as they can be approved by a resolution of the directors and the articles of incorporation remain the same as one of the amalgamating corporations.

Legal considerations for merging businesses

In addition to ensuring that the formal requirements for amalgamation are met, a corporate and commercial lawyer can help you to understand the other legal implications that might be relevant to your merger, including:

• tax considerations
• employment, labour and pension law considerations (particularly if the merger will result in redundancies in your work force)
• securities law considerations
• competition law considerations.

Mergers of two or more companies are generally thought to benefit Canadian consumers by increasing competitiveness. Many of the benefits of amalgamation listed above result in better service, better products or better prices for clients and customers. However, the Competition Bureau of Canada has the jurisdiction to review mergers to ensure that they don’t result in reduced competition in a given market. If the Commissioner of Competition has concerns about the effect of a particular merger on competition, they can apply to the Competition Tribunal for an order to stop, dissolve or change the terms of the merger.

Contact our corporate and commercial lawyers today to learn more about mergers and the legal implications when consolidating your entity.

How to stay protected as a contractor: understanding the Builders’ Lien Act

The Builders’ Lien Act is designed to provide builders with a simple way to ensure they get paid for their work without having to resort to expensive and complicated litigation. A contractor, subcontractor, labourer or supplier of materials who does not receive payment under their contract as agreed can register a builders’ lien against the title to the property at the Land Titles Office. The legislation provides a mechanism for the property to be sold if necessary to pay the owner’s debts to those with liens against the property.

While the legislation was designed to make life easier for builders, it can still be intimidating for those starting out. Our construction law professionals can ensure that you have a comprehensive understanding of the Builders’ Lien Act and how to stay protected as a contractor.

Are you a contractor?

Not every individual invited to build or improve a building is a contractor under the Act. The contractor is the person or company that entered into a contract with the owner of land to do work or provide materials to improve the land. A labourer is not a contractor, even if they are hired directly by an owner. A labourer is anyone employed for wages in any kind of labour.

A subcontractor is a person that is contracted with or employed under a contract but is neither:

• a contractor
• a labourer
• a person who only provides materials (for example, the lumber supply store)
• a person who only provides a service.

A subcontractor is hired and paid by the contractor, rather than by the owner directly.

What protection does the Act provide to contractors?

A builder who does work or provides material to improve land or a building attached to land is protected under the Act by the ability to file a lien against that land. The lien prevents the owner from selling the land (and the builder’s work or materials, which are now attached) without first dealing with the lien.

In order to take advantage this protection, the contractor must:

• register the lien within the specified time period (currently 45 days after the work is completed)
• preserve the lien by starting an action against the owner in respect of the unpaid contract
• enforce the lien by applying for an order from the court.

Holdbacks

Because the owner is often not personally responsible for paying every subcontractor, labourer and material supplier involved in their project, the Act provides for the owner to hold back a certain amount of the contract price until the work is substantially completed. That way, if the general contractor fails to pay the subcontractor installing the plumbing, the owner of the property has some funds set aside to pay that debt and can have the subcontractor’s lien removed from title.

A contractor needs to understand when and how to issue a certificate of substantial performance in order to have the holdback released when a job is complete.

Prompt payment and other changes coming in July 2021

The Government of Alberta has recently enacted major changes to the Builders’ Lien Act, which are currently scheduled to be in force in July 2021. These changes include:

• time limits to ensure that contractors and subcontractors are paid promptly
• an extension of the period in which a lien must be filed (from 45 days to 60 days)
• a formal adjudication process to help resolve the payment of disputed amounts without the courts.

If you have any questions related to how to stay protected as a contractor, understanding the Builders’ Lien Act or the changes to the Act that are coming this year, contact our Edmonton construction law lawyers today!

Enlisting a legal guardian to look after your child: what you need to know

There are several reasons why you may need to recruit a guardian for your child. Many parents choose to plan for unforeseen events by naming a guardian for any minor children (or adult children who are unable to care for themselves due to a disability) in their will. You may also find yourself unable to continue caring for your child during your lifetime.

If you are fortunate, the child has another involved parent and the choice as to who will be the child’s guardian if something prevents you from caring for your child is easy. For more information about what you need to know about enlisting a legal guardian to look after your child, contact one of our family law lawyers today.

What is a legal guardian?

A child’s guardian is responsible for ensuring that the child has everything they need such as food, shelter, clothing and medical care. The guardian is also responsible for:

• providing emotional, physical, psychological and financial support and guidance
• making major decisions about the child’s cultural, linguistic, religious and spiritual heritage
• making decisions relating to the child’s education
• making decisions relating to where the child will live (and with whom)
• providing consent for the child’s medical care
• providing consent for legal purposes and representing the child in a lawsuit.

How to transfer guardianship of a child

In Alberta, a child’s parents are automatically the child’s guardians. A person can also become a guardian if:

• they are appointed by a court order, or
• they are named in a will written by the child’s parent or guardian as a replacement guardian for the child (this must be confirmed by the court).

When you transfer guardianship of a child, the guardianship duties can be divided. In some circumstances, it might make sense to appoint one guardian who is in charge of the child in most respects and will care for the child’s person, but to appoint a second person who is in charge of a specific aspect, such as the child’s finances or legal concerns.

How to choose a legal guardian for your child

Most parents choose a replacement guardian for their child from among their close family and friends. Ideally, the replacement guardian should be someone with whom the child already has a close relationship. If the child is at least 12 years old, the court will ask the child’s opinion before appointing or approving a guardianship order, so take your child’s wishes into consideration.

Other factors that you may wish to consider include:

• the child’s age
• the age of the guardian
• specific needs the child may have and the guardian’s ability to accommodate those needs
• where the guardian lives and their willingness to relocate if necessary
• how the child will fit into the guardian’s life and the guardian’s willingness and ability to make any necessary changes
• the guardian’s personal beliefs and outlook with respect to raising a child, religion, spirituality, education and anything else that is particularly important to you.

It is generally a good idea to nominate an alternate guardian, just in case your first choice becomes unable or unwilling to accept the child’s guardianship.

If you fail to appoint a replacement guardian, the court will choose one for you if necessary. The person chosen by the court may not be the person you or your child would have preferred. One of our family law professionals can tell you everything you need to know about enlisting a legal guardian to look after your child. Contact us today.

Changes to the Divorce Act Shed Light on the Importance of Respecting Cultural and Spiritual Heritages

Cultural and spiritual heritages have been considered throughout history to be the glue of our country. Culture and spirituality bind our communities and create shared spaces for individuals to feel a sense of belonging and togetherness. The direct impact cultural and spiritual heritages and communities have on a child’s ability to succeed have been widely researched. It has been proven that the more supported and included children feel, the more likely they are to be empowered to succeed. Therefore, it is important to consider your cultural and spiritual heritages' impact on your child when proceeding with your custody legal matters. Our Edmonton divorce lawyers are prepared to assist you with your divorce and joint custody; call us today, 587-410-2500 for a consultation.

Divorce Act Amendment

As of March 1, 2021, the Divorce Act has been amended to focus on the importance of a child’s cultural, linguistic, religious, and spiritual upbringing and heritage. This amendment includes a child’s Indigenous upbringing and heritage. If you are a family involved or included in cultural or spiritual communities and are considering getting a divorce you should reflect on how you will continue to honour your heritage.

The Divorce Act was amended to focus on how cultural and/or religious traditions or communities can pose as a support system for children. The change in the Act allows for shared custody parenting arrangements to be altered to accommodate and reflect cultural aspects of communities and the family's involvement in those communities. For instance, a key factor for the court to determine a family's child custody arrangements may be the ability of a parent to educate their child on their cultural, linguistic, and religious heritage. Another important factor is the parent's ability to foster and encourage a child to develop their own cultural identity and self-esteem. In the case of a family filing for divorce under these pretenses, a court would decide how to weigh each factor, dependent upon the effects of the factor on the child’s well-being.

Indigenous Upbringing and Heritage

The amendment, specifically, mentions Indigenous upbringing and heritage. Indigenous culture and heritage are honoured widely across Canada. It is pertinent for Indigenous children to have the opportunity to learn from their elders and be immersed in their cultural and spiritual heritage. The importance of involvement in the extended family is another consideration when the court is deciding upon parenting arrangements.

Your Spouse Does Not Hold the Same Values and Beliefs, How to Create a Parenting Agreement to Suit this Predicament?

In some cases, one spouse does not hold the same values and beliefs; therefore, it is important to consider the effects that this could have on your child’s cultural or spiritual journeys. It may be a consideration for you and your spouse to plan and schedule the major holidays or observation periods that your religion or culture requires in your family plan. In Alberta, this plan is called a Parenting Agreement, which outlines cultural and spiritual holidays and observation periods, living arrangements, parenting schedules, vacation and travel, health care, and education plans for the child that both spouses will adhere to. This arrangement can also include but is not limited to family pet arrangements, electronic device usage, dietary restrictions, extended family visits, and when to introduce a child to a new partner or potential step sibling. A key component to note in the parenting plan is the level of communication expected between the parties. Specifically, how frequently will you remain in contact, what methods of communication will you use, when is appropriate to contact one another, what information will be communicated between spouses, how to talk to your child and what information will be communicated. The final consideration for communication is what to do in emergency situations. Our Edmonton divorce lawyers can assist you with drafting your Joint Parenting Agreement.

If creating the Parenting Agreement with your spouse is not an option for your family, you have the opportunity to petition the court to create a Parenting Agreement for your situation. The court will develop a parenting plan that suits the best interests of the child.

Contact One of our Edmonton Divorce Lawyers for Legal Assistance Today

Our Edmonton divorce lawyers offer legal services that can prepare you for your divorce and answer your questions regarding parenting arrangements. We are available when you need us to ensure that your family is the top priority. Whether you have begun the divorce proceedings or are deciding on the best approach - Verhaeghe Law Office may be able to help you. If you require services related to divorce law, please contact one of our Edmonton divorce lawyers today by filling out a consultation form or calling us at: (587) 410-2500.

*Disclaimer: Please note that this page is not intended to constitute legal advice. The page provides a general overview of the legal service area. As each legal issue is independent and unique it is important to access qualified legal advice. We recommend that you contact a Verhaeghe divorce or family lawyer for any legal inquiries pertaining to divorce and family laws.

Recently Divorced and Considering Relocating With Your Children? How Mobility Rights In Alberta Will Affect Your Plans

Divorce is a major life change and it can bring with it other major changes, including the need or desire to move to another town, province or country. Relocating with your children can have a big impact on the children’s relationships and their general well-being and you should consider your options carefully before planning a move.

Recent changes to Canada’s Divorce Act include a framework to deal with mobility applications in a way that aims to protect the relationships that children have with all of the important people in their lives.

If you are recently divorced and considering relocating with your children, contact our divorce lawyers to find out how mobility rights in Alberta will affect your plans.

What does it mean to relocate?

There is a difference between changing residence (moving to a different home) and relocating. Relocating is defined in the Divorce Act as a move that would be expected to have a significant impact on the child’s relationship with someone who has:

• parenting time
• decision-making responsibility, or
• an order for contact with the child.

Do you have to give notice to the other parent before you move?

Before you move with your children, you will probably need to advise the other parent of your plans. In most cases, the other parent will have (at least) guardianship rights or decision-making responsibility with respect to the children. This means that you need to make major decisions affecting the children together. If they do not agree with your intended move, then you may need to get a court order.

If you have a written agreement that deals with parenting, or a court order under the Family Law Act (which would be the case if you were never legally married), then your agreement or court order should specify the notice that you are required to give the other parent before you relocate.

If you have an order under the Divorce Act, then there are formal notice and objection requirements that you must follow. Specifically, you must give 60 days’ notice of an intended relocation. If the other parent objects, they must provide formal notice of their objection to the move within 30 days, at which point a judge will make the decision about whether or not the relocation can proceed as planned.

If you move without notifying the other parent (even if you don’t have a parenting agreement or an order in place) you might be accused of abducting the children and a judge might decide that your actions were not in the best interests of the children, which might affect your parenting rights and responsibilities in the future.

How will the court decide if you can move with the children?

The court makes all decisions relating to relocating with children by determining whether the relocation is in the best interests of the children. To determine what is best for the children, the court will look at:

• the reasons for the relocation
• how the move will impact the child and the amount of time they spend with each parent and other important individuals, such as grandparents
• how reasonable the proposed relocation is, taking into account factors such as the cost of travel
• the wishes of the children (depending on their ages)
• many other factors.

Pursuant to the new changes to the Divorce Act, a court hearing a mobility application under that Act is not allowed to consider whether you will still move if the court determines that the children are not allowed to go.

The laws in Alberta relating to mobility applications are complex and getting it wrong can have serious repercussions on your life. If you are recently divorced and considering relocating with your children, contact us to learn how mobility rights in Alberta will affect your plans.

Common Law Divorce In Alberta: What To Expect

In Alberta, we typically don’t use the word divorce in conjunction with a separating common law couple. A divorce is the court order that a married couple receives to legally dissolve their relationship. If you were never legally married, then you do not need to get divorced.

However, if you are in a common law relationship, or an adult interdependent partnership, and you wish to separate from your partner, then you should be aware of your rights and responsibilities. Our Edmonton area family and divorce lawyers can answer all your questions about what to expect from a “common law divorce” in Alberta.

What is an adult interdependent partnership?

In Alberta, the Adult Interdependent Relationships Act creates a relationship called the “adult interdependent partnership”, which replaces the common law marriage or common law relationship. An adult interdependent partnership does not have to have a conjugal, or sexual, element. It can take place between related individuals, such as siblings or a parent and adult child, or between friends.

An adult interdependent partnership is limited to two people and you cannot be in more than one at a time. You can enter into an adult interdependent partnership by:

• written agreement (this is the only way for individuals related by blood or adoption to enter into an adult interdependent partnership)
• live together in a “relationship of interdependence” for at least three years, or
• live together in a relationship of interdependence of “some permanence” and have a child together (by birth or adoption).

Whether or not a relationship qualifies as a relationship of interdependence will depend on all the circumstances. A romantic or sexual relationship is not necessary, but it may be one factor that indicates a relationship of interdependence in some circumstances.

How to dissolve an adult interdependent partnership

Either partner can choose to end an adult interdependent partnership. If you have a written Adult Interdependent Partner Agreement, the agreement ends when the relationship ends.

An adult interdependent relationship can be dissolved by:

• written agreement between the partners (this applies whether or not you entered into the partnership by written agreement)
• living separate and apart from your partner for one year with the intention of ending the relationship
• you get married (to each other or to another person)
• you enter an Adult Interdependent Partner Agreement with another person (note that this is only effective if you are not a party to an existing Adult Interdependent Partner Agreement), or
• a court makes a declaration of irreconcilability.

Factors to consider during your common law divorce in Alberta

What to expect when you separate from your adult interdependent partner:

• if you have children with your partner, you will need to decide issues relating to the guardianship and parenting of the children as well as child support
• you or your partner may claim spousal support from the other, depending on the circumstances of your relationship and your separation
• as of January 1, 2020, property division laws that apply to married couples apply to those in an adult interdependent partnership as well
• it is a good idea to redo your will, enduring power of attorney and any personal directives as soon as possible after you separate.

While you do not need a divorce, there are still many legal issues to consider when separating from your common law partner. Our legal professionals are here to help address your concerns. Contact us today!