Encyclopedia
Accelerated rent
A lease clause that makes some or all future rent due right away if the tenant defaults. Whether and how a landlord can enforce it depends on the lease wording and the law.
For example: A tenant falls behind and the landlord's notice demands the next several months of rent at once, relying on an acceleration clause. That's the moment to call a lawyer, not to guess. (Illustration only, not a real deal.)
Official source: Commercial Tenancy Act (BC Laws)
Example only, not a real client. Say a tenant falls behind on rent and the lease has an accelerated rent clause. The landlord may claim several months of future rent at once, in addition to arrears. The tenant’s lawyer reviews how the clause applies before responding.
What I’d tell a friend
Read the default terms in your lease, including any accelerated rent clause, before you sign.
Why it matters to you
One missed payment can turn into a demand for months of rent at once. That changes how much a default really costs you, and it's why tenants push to cap it or delete it before signing.
How to use it in your deal
Tenants should read the default and remedies sections closely and negotiate limits, notice periods and cure rights before accelerated rent applies. Landlords should know that courts look at these clauses carefully, and the Commercial Tenancy Act and bankruptcy law can affect how much can be claimed; in a tenant bankruptcy, the landlord's claim for accelerated rent may be limited and ranks behind some creditors.
Clauses that look like penalties rather than genuine estimates of loss may not be enforced. Landlords still usually have a duty to try to re-lease and reduce losses once the lease is terminated. Buyers should check whether any tenants are in default. Tenants in trouble should talk to the landlord early, since workouts often cost less than litigation.
Keep payment records and notices organized, and get legal advice before you respond to a demand. Ask your lawyer whether the clause caps the amount or lets the landlord re-let first.
Mistakes I see
Not noticing the clause. Assuming it's always enforceable. Ignoring bankruptcy limits.
In BC and Vancouver
The Commercial Tenancy Act, the federal Bankruptcy and Insolvency Act, and case law on CanLII apply.
Official sources: Commercial Tenancy Act (BC Laws) · CanLII (court decisions)
What it means
An accelerated rent clause lets a landlord demand a set amount of future rent immediately if the tenant defaults in certain ways.
BC’s commercial tenancy law and the lease wording affect how it applies.
What to know
Tenants should negotiate limits and notice periods for defaults, and a chance to fix a problem before remedies apply.
Check with a BC lawyer on how these clauses work in practice.
Questions to ask before you sign
- Does my lease have it?
- How much can be accelerated?
- Is there a cure period?
- What happens in bankruptcy?
Keep reading
Related terms: Distress, Guarantor, Indemnifier
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General information for British Columbia only. It isn’t legal, tax, accounting or financial advice, laws and rates change, and reading it doesn’t make you my client. Any numbers or scenarios are hypothetical. Check the linked official source and talk to a lawyer, accountant or other qualified professional before you act or sign anything. See the terms and disclaimer.