No Commercial Lease Agreement: What Are My Rights? (2026 Updated)

It’s a situation many business owners find themselves in: you’ve moved into a space, you’re paying rent, you’ve set up shop… and then you realise there’s no signed commercial lease agreement (or the paperwork is incomplete, expired, or “we’ll sort it out later”).

If you’re feeling uneasy, that’s completely normal. A commercial premises is often one of your biggest business costs and one of your biggest operational risks.

This guide is updated for 2026 so you can feel confident you’re working off current, practical guidance. We’ll walk through what your rights may look like when there’s no formal commercial lease agreement, what risks to watch for, and what steps to take now to protect your business from day one.

Important: commercial leasing outcomes can depend heavily on the facts (what was agreed, what was paid, emails and messages, industry practice, and the landlord’s conduct). The best move is to get tailored legal advice before you make major calls like withholding rent or vacating a premises.

What Does “No Commercial Lease Agreement” Actually Mean?

When people say they have “no lease”, they often mean one of these common scenarios:

• There was never a written lease signed, but you moved in and started paying rent anyway.
• You have a draft lease (or heads of agreement) but it was never executed.
• Your lease has expired and you’ve stayed on paying rent, with no new document signed.
• You signed something informal (like an email agreement, letter, or short document) but it doesn’t cover the usual lease terms.
• You’re subleasing or sharing space, but there’s no clear sublease arrangement in place.

Each of these can create different rights and obligations, but the key point is this: the absence of a signed document doesn’t always mean there’s no legal arrangement.

In many cases, the law can still recognise a tenancy or an enforceable agreement based on what the parties have said and done (for example, possession of the premises and payment/acceptance of rent).

Why This Matters (Even If Everyone Gets Along Right Now)

It’s easy to think “we’ve got a good relationship, it’ll be fine.” The problem is that the issues usually come up when something changes, like:

• the landlord wants to increase rent suddenly;
• you need certainty to fit out the premises or sign up to longer supplier contracts;
• the landlord sells the building;
• you want to assign the lease or exit the space;
• a dispute happens about repairs, outgoings, signage, or operating hours.

Without a clear agreement, you can end up with uncertainty about notice periods, rent review mechanisms, outgoings, maintenance responsibilities, and what happens if either side wants to end the arrangement.

Do I Still Have Any Rights If There’s No Signed Lease?

Often, yes-but your rights may be less certain and more dependent on evidence.

In practical terms, if you’ve moved into the premises and the landlord has accepted rent, there may be an argument that a tenancy exists on certain terms. Those terms might come from:

• emails, text messages, or letters discussing rent, term length, and other conditions;
• any heads of agreement or draft documents exchanged;
• the conduct of both parties (for example, how rent increases have been handled historically);
• industry custom (depending on the type of premises and arrangement).

That said, rights in “no lease” situations aren’t one-size-fits-all. Two businesses can be in superficially similar positions but have very different outcomes depending on their communications and documentation.

Common Rights And Protections You Might Still Have

Depending on your arrangement, you may still have some ability to:

• Remain in the premises until the landlord gives reasonable notice (what’s “reasonable” can vary).
• Challenge unexpected terms the landlord tries to impose later (for example, a new outgoing charge you never agreed to).
• Rely on agreed commercial terms that can be proven (like the rent amount, the area you occupy, and permitted use).

The big catch is that your position is generally stronger when you have a clear paper trail. If most of the arrangement was verbal, disputes become harder (and more expensive) to resolve.

What If The Landlord Says “You Have No Rights Because You Never Signed Anything”?

That statement is often oversimplified. While a written lease is the gold standard, courts and tribunals can look at what actually happened in practice.

However, this is also why getting advice early matters. If you respond the wrong way (for example, by refusing to pay rent without a plan), you can accidentally weaken your position.

What Are The Biggest Risks Of Occupying Commercial Premises Without A Lease?

Even where you might have some rights, operating without a signed commercial lease can expose you to real business risk. Here are the most common problem areas we see.

1. You Might Be On A Periodic Arrangement With Short Notice

If there’s no agreed fixed term, you may effectively be on a rolling arrangement (often described as “periodic”), which can mean either party can end it with notice.

The risk is that you can’t confidently plan:

• fit-outs and renovations;
• long-term staffing;
• marketing spend tied to location (signage, local SEO, foot traffic reliance);
• expansion decisions.

If your business is location-dependent (hospitality, retail, medical, fitness), losing premises quickly can be a major disruption.

2. Unclear Rent Reviews And Increases

A properly drafted commercial lease will usually set out:

• when rent can be reviewed (e.g. annually);
• the method (CPI, market review, fixed percentage);
• any dispute mechanism if you disagree with the new rent.

Without that clarity, you may face unpredictable rent increases, or disputes about whether an increase is allowed at all.

3. Outgoings And Operating Costs Can Become A Surprise

Outgoings can include items like rates, insurance, body corporate fees, or building maintenance costs. In “no lease” situations, a landlord might later argue you agreed to pay them, while you believed rent was “all inclusive”.

This is one of the most common sources of conflict-and it can be avoided with the right documents upfront.

4. Repairs, Maintenance, And Compliance Can Fall Into A Grey Area

Commercial premises often involve ongoing issues like:

• HVAC servicing and repairs;
• plumbing and electrical maintenance;
• building compliance and safety measures;
• damage responsibility (wear and tear vs tenant damage).

If your responsibilities aren’t clearly set out, you might end up paying for costs you didn’t budget for-or, alternatively, you might delay repairs because you assume it’s the landlord’s issue, and the dispute escalates.

5. You Can Struggle To Sell The Business Or Bring In Investors

If you ever want to sell your business (or even just sell the assets and goodwill), a buyer will usually want certainty on the premises.

If your premises are essential to the business, buyers will commonly ask:

• Is there a lease in place?
• How long is the term?
• Can the lease be assigned to the buyer?
• Are there restrictions on use?

Uncertainty here can reduce the value of your business, delay a sale, or cause a buyer to walk away. (This is also why a proper Commercial Lease Agreement matters so much when you’re planning for growth.)

What Should I Do If I’m Already In The Premises Without A Lease?

If you’re currently occupying a commercial premises with no signed lease, don’t panic-but do get organised. Here’s a practical step-by-step approach.

1. Gather Your Evidence (Before You Negotiate)

Start by collecting everything that shows what was agreed, including:

• emails and messages discussing rent, outgoings, bond, and term;
• any heads of agreement, letter of offer, or draft lease;
• invoices and receipts for rent payments;
• bank statements showing payment history;
• photos of the premises condition when you moved in (if available);
• any fit-out approvals or communications about works.

This helps you understand your leverage and gives your lawyer something concrete to work with.

2. Clarify What You Need From The Space

Before you ask the landlord for “a lease”, be clear about what you actually need, such as:

• a fixed term (e.g. 2–5 years) so you can safely invest in fit-out;
• rights of renewal;
• certainty on rent reviews;
• clarity on outgoings;
• a permitted use clause that matches your business model;
• ability to assign the lease if you sell the business.

This will make negotiations faster and reduce the risk you sign something that doesn’t match how you operate.

3. Propose A Written Agreement (Or A Formalising Document)

In many cases, the goal is to get a properly drafted lease in place. If you already have a document from the landlord, it’s often smarter to have it reviewed before you sign.

If you’re presented with a lease or a variation document, a Commercial Lease Review can help you understand your risks around outgoings, make-good obligations, repairs, default clauses, and termination rights.

If the arrangement involves taking over another tenant’s space, you may need a Deed of Assignment of Lease rather than starting from scratch.

4. Be Careful About “Side Deals” And Verbal Promises

It’s common for landlords and tenants to agree to things informally, like:

• “Don’t worry about outgoings for the first 3 months.”
• “You can definitely put up that sign.”
• “We’ll allow your outdoor seating.”
• “We’ll renew you if things go well.”

These promises can be hard to enforce later unless they’re properly documented. If it matters to your business, it should be in writing (and ideally inside the lease documents).

5. Get Advice Before You Threaten To Leave Or Stop Paying Rent

When things feel unfair, it’s tempting to jump straight to “we’re leaving” or “we’re not paying.” The problem is that these steps can escalate a dispute quickly.

A better approach is to:

• get advice on your current legal position;
• understand what notice may be required (for both sides);
• negotiate a written agreement or exit plan with clear dates and responsibilities.

If you’re considering exiting, a formal lease surrender can reduce risk. In many situations, a Lease Surrender Agreement is the cleanest way to document the end of occupation, the handover date, and any settlement of costs or make-good requirements.

Can The Landlord Lock Me Out Or Kick Me Out Without A Lease?

This is one of the most searched questions-and it makes sense. If your premises is critical to your income, the idea of being “locked out” is scary.

In general, even where there’s no signed lease, the landlord should be cautious about taking matters into their own hands. If a tenancy arrangement exists (even informally), attempting to remove a tenant without following proper process can create legal risk for the landlord.

But the practical reality is that without a clear written lease:

• it can be harder to prove what notice is required;
• you may have fewer protections around renewal or continued occupation;
• disputes can escalate quickly because both sides feel uncertain.

If you’re in conflict with your landlord, the safest move is to get advice early and aim for a written, negotiated outcome (either a lease document or a documented exit).

What If I’ve Spent Money On Fit-Out?

If you’ve invested in fit-out, equipment installation, or renovations, you’ll want to understand:

• what you own vs what becomes part of the premises;
• whether you have to “make good” at the end;
• whether you can remove fixtures and signage;
• whether you can seek compensation in any scenario.

This is one of those areas where tailored legal advice matters, because the answer depends on the nature of the work, what was agreed, and how the premises is configured.

How Do I Protect My Business From This Happening Again?

If you’re negotiating a new premises (or you’re formalising your current one), your goal is to create certainty. A well-structured commercial lease reduces misunderstandings and gives you a framework to resolve issues before they become business-ending disputes.

Key Clauses And Issues To Get Right

When you’re signing (or renegotiating) a lease, it’s worth checking that the agreement clearly covers:

• Term and renewal rights (and what you need to do to renew).
• Rent and rent reviews (method, timing, and dispute processes).
• Outgoings (what’s included, what’s excluded, and how they’re calculated).
• Repairs and maintenance responsibilities (and timeframes).
• Permitted use (so you’re not accidentally breaching by expanding services).
• Fit-out and alterations approval process.
• Make-good obligations on exit (often a surprise cost).
• Assignment and subleasing rights (particularly if you plan to sell your business).
• Default and termination clauses (what happens if something goes wrong).

If you’re negotiating commercial terms first and want a stepping-stone document that captures the main points, a heads of agreement can help-but it’s crucial to understand what is binding and what isn’t. A Heads of Agreement should still be handled carefully so you don’t accidentally lock yourself into a bad deal.

Don’t Forget The Other Legal Foundations Around Your Premises

Leasing issues often overlap with other legal basics. For example:

• If you’re hiring staff for your new location, your Employment Contract should align with your operating hours and the reality of your business (especially if you’re scaling quickly).
• If you’re collecting customer details (bookings, mailing lists, CCTV footage, Wi-Fi sign-ins), having a clear Privacy Policy helps you stay compliant with the Privacy Act 2020 and builds customer trust.

It can feel like a lot, but the big picture is simple: the stronger your foundations, the easier it is to grow with confidence.

Key Takeaways

• If you’re occupying commercial premises without a signed lease, you may still have rights based on what was agreed and how both parties acted, but your position can be less certain and more evidence-dependent.
• The biggest risks of having no commercial lease agreement include unclear notice periods, unpredictable rent increases, disputes over outgoings, and uncertainty about repairs, fit-out and make-good obligations.
• Start by gathering your documents (emails, drafts, payment history and messages) so you can clearly establish what was agreed before negotiating or escalating the issue.
• Where possible, formalise the arrangement with a properly drafted lease (or the right document for your situation, like an assignment or surrender), and get it reviewed before you sign.
• Avoid relying on verbal promises for anything important to your business (like renewal rights, signage, outgoings, or fit-out permissions) and make sure key terms are documented.
• If you’re considering leaving, withholding rent, or you’re in dispute with your landlord, get legal advice early so you don’t accidentally weaken your position or trigger avoidable costs.

If you’d like help reviewing your situation or putting the right commercial lease documents in place, you can reach us at 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.