Property owners, lenders and others are using estoppels to stop problems. Although estoppels only contain a small number of words, they can have big benefits. If you are missing estoppel rights, you can miss opportunities and suffer from lawsuits and disputes.
An estoppel certificate is a signed statement that is used to prevent you from unfairly denying the truth of facts that have already been settled. Black’s Law Dictionary defines an estoppel certificate as a signed stipulation of previously established facts preventing subsequent contradiction or recant of these facts. Often, they are used by lenders when property is being refinanced to confirm there are no disputes. For example, landlords and lenders can ask tenants to certify facts relating to leases, such as the rent and the expiration date, to preclude claims that the rent or expiration date are different. Estoppel rights can also be contained in other documents and good leases will actually require tenants to sign estoppel certificates upon requests by landlords.
Estoppels Can Stop Suits. Estoppels are valuable because they can help you to cut costs and quickly win lawsuits. Unlike complex big documents, a simple statement can clearly prove that you deserve to win, especially if it contains an admission by your opponent that they are wrong and you are right. For example, estoppels have been used to quickly win lawsuits involving many types of issues, including the amounts due, the validity of documents, the terms of documents, and whether defaults exist or have been cured.
Estoppels are effective at cutting costs and reducing risks because they are generally enforced when properly prepared unless the certifying party can show a defense to the making of the document, such as fraud or duress, or that it was accepted with knowledge of the contrary, and true, state of facts.
Estoppels Can Stop Disputes. Estoppels can also cut costs and add value by preventing disputes from becoming lawsuits. Having excellent estoppels can persuade parties to quickly resolve small problems before they grow into big disputes. Even after disputes exist, estoppels can be exchanged as part of settlements. Exchanging estoppels early and often can also prevent problems by improving communication and building and strengthening relationships.
Estoppels Can Create Opportunities. In addition to minimizing your risks, excellent estoppels can maximize your opportunities. If you are missing excellent estoppels, you can lose valuable rights to buy, sell, assign, sublet, operate, renovate, finance, and refinance. Having the estoppels you need, will help you to quickly close and succeed.
Obtain the Estoppels You Need. It is critical to consult counsel to ensure that you benefit from the estoppels you need. Many issues must be addressed, including what estoppel rights you need, when you need them, and how you will obtain them. Evaluating estoppels and other legal issues requires careful review on an individual basis with experienced counsel.