Nevada Commercial Lease Agreement

Implied Covenant of Good Faith and Fair Dealing

The Nevada Supreme Court has acknowledged the implicit agreement of good faith and fair dealing associated with contracts. This agreement was clarified in the 1991 ruling of Hilton Hotels Corporation v. Butch Lewis Productions. 

The Court stated in its decision that if a party executes a contract that contradicts its objectives and denies the other party’s justified expectations, the party acting in bad faith may be liable for damages. Determining whether the dominant party’s actions deviate from the dependent party’s reasonable expectations is based on various factors and overall circumstances.

Statutory Notice Periods

• Under Nevada law, a tenant must be given a thirty (30) day notice, followed by a five (5) day notice that directs the tenant to vacate as their stay is now considered illegal. 

In order to carry out an eviction without a specific reason, the tenant must receive:

• A Thirty (30) Day “No Cause” Notice to Quit if the tenant’s rent is paid monthly 
• A notice for eviction due to unlawful detainer has been issued, requiring the occupant to vacate the premises within five (5) days.
• Both of these notices must be delivered to the tenant by a constable, sheriff, licensed process server, or a representative of a Nevada-licensed attorney.
  • The landlord isn’t permitted to deliver these notices personally.

Security Deposits

• Nevada has no limitations on the sum a commercial landlord can request as a security deposit. 
• There are also no rules or stipulations regarding the return of security deposits. 
• The state doesn’t forbid mixing commercial security deposits with other monies. 
• Commercial landlords in Nevada aren’t obligated to keep security deposits in accounts that accrue interest or to pay any interest on tenant security deposits.

Disclosures

There are a few standard disclosures generally mandated by most states.

• The security deposit information
• Nonrefundable fees
• Disclosure about the responsible party for maintaining smoke alarms
• Foreclosure of the property
• New owner identity if the property is sold
• If environmental hazards are present
• If there was methamphetamine manufactured on the property before
• Be present for any inspections
• Flood disclosures 
• Copy of the Nevada commercial landlord/tenant code
• Lead-based paint for buildings built before 1978

Termination and Renewal

• While business tenants typically have the privilege to extend their lease when it expires, there are instances where landlords can decline to offer a new lease.
  • In most cases, a landlord isn’t obligated to provide a reason (although actions based on discriminatory or retaliatory motives are unlawful). 

• A landlord can issue a written notice to vacate, giving a tenant a 30-day notice as mandated by Nevada law and indicating the date your lease will terminate. 
• Even if both the landlord and tenant have chosen to opt out of sections 24 to 28 of the Landlord and Tenant Act 1954, it’s still safest for the landlord to provide at least a three (3) month notice.
• A Nevada landlord is only required to give a reasonable notice to vacate.
  • This usually equates to the length of the rental payment period, so if a tenant pays rent monthly, they’ll receive a month’s notice.