The Risk You Are Not Watching Closely Enough

Your business may be carrying a significant legal liability right now, and its origin may have nothing to do with your product, your workforce, or your market position.

Environmental compliance is one of those operational issues that is easily overlooked by companies, yet expands in complexity while the business owner remains focused on revenue generation, growth strategy, and day-to-day management. Compliance deficiencies  aren’t always readily apparent nor do they announce themselves in advance. There is no formal notice when a regulatory gap opens, and by the time you receive a notice of violation or a knock on your front door, what could have been a straightforward operational matter has already developed into something considerably more consequential, legally, financially, operationally, and reputationally.

As we approach Earth Day on April 22^nd,  it is a good time to examine how environmental compliance intersects with business accountability.  Ask  yourself: does your business have a clear, current, and jurisdiction-specific understanding of its environmental compliance posture; not merely at the federal level, but across every jurisdiction in which you operate, every property you own or lease, and every permit issued in your name?

If that question produces any uncertainty, the following analysis warrants your attention. The five compliance failures described below are not uncommon or industry-specific. They are recurring patterns across business sizes, sectors, and geographies. The bottom line is that each one is entirely preventable with the right legal partnership in place before a regulatory problem materializes.

Mistake One: Treating Federal Compliance as the Full Measure of Legal Obligation

This is perhaps the most pervasive misconception in environmental compliance, and it affects enterprises of every scale, from regional operators to multinational developers. The assumption is straightforward: federal standards have been met, therefore the business is covered. It is an understandable conclusion. It is also an incorrect assumption.

Environmental regulation in the United States operates on multiple, frequently overlapping jurisdictional layers. Federal agencies, principally the Environmental Protection Agency, establish baseline standards. Individual states are expressly authorized to impose requirements that are more stringent, more operationally specific, and enforced by entirely separate regulatory bodies. Beyond state-level obligations, municipal and county governments often add a further tier of requirements governing stormwater management, air quality thresholds, hazardous material handling, or operational permitting tied to proximity to protected natural resources.

Consider a business that expands into a new state having diligently maintained federal environmental compliance at its original location. The operational team assumes regulatory continuity. The new state, however, imposes more aggressive reporting obligations around certain categories of chemical storage, and the local municipality requires a separate operating permit conditioned on proximity to a watershed. Neither obligation appeared in the company’s existing compliance framework, because that framework was constructed around federal standards alone.

The space between federal compliance and full legal compliance is where regulatory violations take hold. For businesses with multi-state operations or any international dimension, this layered regulatory reality compounds significantly. Legal counsel with demonstrated cross-jurisdictional fluency, the kind that extends across both domestic and international regulatory environments, is not a supplementary resource in this context. It is a strategic operational necessity.

Compliance is not a single destination. It is a continuous navigation across multiple regulatory landscapes, each with its own requirements, enforcement priorities, and consequences for noncompliance.

Mistake Two: Proceeding with Property Acquisition or Expanding Operations Without Environmental Due Diligence

Real estate investors and developers face particular exposure here, though the risk is not limited to them. Any business that acquires property, enters a long-term lease, or materially expands its operational footprint is subject to the same underlying legal reality: environmental due diligence is among the most effective risk mitigation tools available at the transactional stage, and it is among the most frequently omitted.

The foundational danger is this: acquiring a property may mean acquiring its environmental history. Prior occupants, prior owners, or prior industrial use can leave behind liabilities in the form of contaminated soil, underground storage tank residue, or historical waste disposal activity, and those liabilities attach to the current owner or operator as a matter of law in most jurisdictions, regardless of who created the underlying condition.

Consider a developer under competitive pressure to close on a commercially attractive site. An environmental assessment might feel like an a risky delay. As a result, it is dismissed,  abbreviated, deferred, or delegated to a general contractor without the requisite environmental expertise. Months into development, contaminated soils or wetland issues  are identified and the owner/developer is faced with a need to remediate or mitigate the problem.  Depending on the complexity of the situation, the project timeline, capital budget, and in some cases the project itself could be  substantially compromised.

Environmental due diligence, conducted at the beginning of the transaction and in advance of any development under qualified legal oversight, identifies these exposures before they become the acquirer’s problem. For businesses expanding across state or national boundaries, legal counsel with jurisdiction-specific knowledge of how environmental liability attaches and transfers is not a supplementary consideration. It is the difference between a sound acquisition and an inherited liability of indeterminate cost.

Mistake Three: Operating Under Waste Classification and Chemical Storage Policies That No Longer Reflect Current Regulatory Standards

Regulations evolve. Internal compliance policies, however, frequently do not; at least not at the same pace. Regulatory changes often result in non-compliance:: a business that was in full compliance several years ago, operating under the same documented policies, may be out of compliance today because the applicable regulatory framework changed while internal procedures remained static.

Companies that have hazardous waste streams from industrial or manufacturing operations are an example of how businesses can become out of compliance due to regulatory changes. How a business categorizes, stores, labels, and disposes of chemical waste or hazardous materials is governed by detailed regulatory requirements that undergo regular revision. Materials once classified at a lower regulatory tier may now carry heightened obligations. Storage quantities that previously fell below mandatory reporting thresholds may now trigger disclosure requirements. Disposal methods once treated as standard practice may now require additional permitting or may be prohibited altogether.

. An internal environmental compliance audit conducted several years ago provides no meaningful assurance today. And when an enforcement body identifies a misclassification, whether intentional or not, the legal and financial consequences apply with limited regard for the business’s state of knowledge at the time.

The appropriate response is not a single environmental compliance audit, but rather routine audits. Environmental compliance requires active, legally informed monitoring, particularly as regulatory cycles shorten globally and enforcement scrutiny of business environmental practices intensifies. Legal counsel working with environmental compliance specialists convert this risk from an unmonitored liability into a managed operational standard.

Mistake Four: Approaching Permit Applications and Renewals as Administrative Exercises Rather Than Legal Ones

There is a common assumption that permits are procedural paperwork, forms to complete, fees to remit, and boxes to check. On the surface, many permit applications do appear ministerial. That surface impression is legally misleading. Permit applications are legal documents, and the representations contained within them create binding obligations, establish regulatory precedent, and generate exposure that can extend well beyond the permit’s stated scope.

Technical errors in permit applications, including inaccurate descriptions of operational processes, underreported waste volumes, or incorrect facility classifications, can produce consequences that persist long after any correction is made. Regulatory agencies may issue formal notices of violation. Prior misrepresentations, even those made without any intent to mislead, can complicate subsequent renewals and inform the posture of enforcement bodies in future interactions with the business. In some instances, documentation errors in original permit applications become the evidentiary foundation for enforcement proceedings that are substantially more expensive and time-consuming to resolve than a correctly executed original application would have been.

Permit renewals carry distinct risk as well. A renewal proceeding frequently provides regulatory agencies the occasion to apply current standards to an existing operation, standards that may have changed materially since the original permit was issued. A business that treats renewal as a routine administrative function without legal review may find itself subject to new obligations it did not anticipate, or may forfeit the opportunity to address compliance gaps proactively before an agency raises them.

Engaging the services of an environmental law attorney early on in the permit process, not solely in response to enforcement actions, but as an active participant in both initial applications and renewal proceedings, is one of the clearest expressions of what it means to treat legal counsel as a structural operational resource rather than an emergency one.

Mistake Five: Delaying Legal Engagement Until a Violation Notice Has Already Arrived

This final failure is, in many respects, the most financially consequential, not because it involves the greatest technical complexity, but because it is entirely a function of timing. The operational and financial distance between a business that engages legal counsel proactively on environmental compliance and one that waits for a formal violation notice is, in most cases, the distance between a manageable legal matter and a crisis requiring immediate, compressed, and costly response.

When a violation notice is received, regulatory deadlines are already running. Financial penalties are accruing. Mandatory corrective action timelines are in place. The legal engagement that now must occur is reactive, time-constrained, and almost without exception more expensive than addressing the underlying condition earlier in its development would have been. Beyond the direct financial exposure, secondary consequences often include permit suspensions, increased regulatory scrutiny on future applications, and potential civil liability that compounds the immediate damage.

The business that treats environmental compliance as a continuous legal function rather than a reactive emergency response operates from a materially stronger position. It conducts regular compliance reviews with counsel. It monitors regulatory developments applicable to its operations and jurisdictions. It identifies deficiencies before enforcement bodies do. It enters any regulatory inquiry from a position of documented good faith rather than in defense of a formal enforcement action. And when a regulatory inquiry does arise, as they do across industries and geographies, that business responds with speed, documentation, and legal credibility.

Proactive legal partnership in environmental compliance is not an overhead cost. It is a protection strategy with a measurable return. In a regulatory environment that is growing demonstrably more rigorous, the businesses that internalize this are the ones that preserve operational continuity, protect asset value, and maintain the institutional credibility necessary to sustain long-term growth.

The Larger Framework: Environmental Compliance as a Component of Business Protection

Earth Day is a useful cultural reference point.  It can be used by businesses as a reminder to assess its environmental compliance strategy.. The five failures described above are not confined to industrial manufacturers or large-scale developers. They arise in property transactions, in routine operational practices, in annual permit renewals, and in the growing gap between the current trajectory of environmental regulation and the present state of internal compliance policies.

For businesses operating across state lines or with any international dimension to their work, the complexity intensifies. Environmental obligations are not jurisdictionally self-contained, and legal counsel with cross-jurisdictional depth is often the only practical means of navigating regulatory regimes that differ substantially from one jurisdiction to the next.

There is also a structural connection worth noting. Business owners who invest in the legal soundness of their operational foundations, through rigorous environmental compliance, thorough transactional due diligence, and active legal partnerships, are simultaneously protecting the long-term value of everything they have built. The business that is legally compliant, operationally clean, and free of undisclosed environmental liability is the business that can be transferred, scaled, or succeeded with clarity and confidence. The intersection between environmental compliance and broader business protection is not incidental. It is inherent to the structure of how legal and operational risk interact.

The Appropriate Next Step

Environmental compliance questions do not resolve themselves, and the regulatory environment surrounding them is becoming more demanding, not less. Whether you are a developer preparing to acquire commercial property, a franchise owner managing multi-location operations, a property manager overseeing commercial or mixed-use assets, or a business executive responsible for operational continuity, the moment to assess your compliance posture honestly is before a regulatory deadline or enforcement notice makes that assessment urgent.

At Dawda PLC, our legal team brings cross-jurisdictional depth to environmental compliance, business protection, and the full range of legal matters that businesses and their principals encounter at every stage of growth. We invite you to contact our office to begin that conversation, before circumstances require it rather than after.

We are pleased to announce that 21 Dawda attorneys have been selected for inclusion in the 2026 edition of The Best Lawyers in America, representing 38 distinct practice area recognitions across our core competencies. This distinguished acknowledgment underscores our firm’s depth of expertise and commitment to delivering exceptional legal counsel across multiple practice areas.

Our Recognized Legal Professionals

The 2026 Best Lawyers selections span our key practice areas, with several attorneys receiving recognition in multiple specialties:

Edward C. Dawda leads our honorees with an exceptional 20-year tenure of Best Lawyers recognition, having first been listed in 2006. Mr. Dawda’s multifaceted expertise is reflected in his recognition across three practice areas: Corporate Law, Mergers and Acquisitions Law, and Real Estate Law.

Susan J. Sadler follows with 16 years of recognition since 2010, demonstrating her sustained excellence in Environmental Law, Litigation – Environmental, and Litigation – Real Estate matters.

Tyler D. Tennent marks his 13th year of recognition since 2013, with expertise spanning Administrative/Regulatory Law, Environmental Law, Land Use and Zoning Law, and Litigation – Land Use and Zoning.

Our recognized attorneys and their respective practice areas include:

• Paul A. Bringer (Real Estate Law, 6th year)
• Alfredo Casab (Litigation – Real Estate, Real Estate Law, 5th year)
• Randal Cole (Commercial Litigation, Employment Law – Management, 2nd year)
• Brian J. Considine (Energy Law, Environmental Law, 5th year)
• Dana A. Kreis Glencer (Real Estate Law, 8th year)
• Daniel M. Halprin (Real Estate Law, 7th year)
• Joseph M. Judge (Real Estate Law, 5th year)
• Christopher R. Martella (Real Estate Law, 6th year)
• Jeffrey D. Moss (Corporate Law, Tax Law, Trusts and Estates, 5th year)
• John Mucha III (Commercial Litigation, Land Use and Zoning Law, Litigation – Real Estate, 6th year)
• Glenn G. Ross (Trusts and Estates, 6th year)
• Marc K. Salach (Corporate Law, 3rd year)
• Todd A. Schafer (Real Estate Law, 7th year)
• Wayne S. Segal (Banking and Finance Law, Real Estate Law, 5th year)
• Neil S. Silver (Banking and Finance Law, Environmental Law, 5th year)
• James J. Vlasic (Commercial Litigation, Corporate Law, 3rd year)
• Frances Belzer Wilson (Commercial Litigation, 3rd year)
• Robert A. Wright (Banking and Finance Law, 2nd year)

The Significance of Best Lawyers Recognition

The Best Lawyers in America represents the gold standard for peer-review recognition in the legal profession. The methodology relies exclusively on peer evaluations, with lawyers casting confidential votes on the professional abilities of other lawyers within their geographic region and legal practice area. The comprehensive evaluation process ensures that only attorneys who have earned the respect and confidence of their peers receive this distinction.

This peer-review foundation is particularly meaningful in the legal profession, where professional competence, ethical standards, and client service excellence are paramount. The longevity of recognition demonstrated by attorneys such as Mr. Dawda and Ms. Sadler reflects not merely initial achievement, but sustained excellence throughout their careers.

Implications for Client Service

These recognitions validate what our clients experience in their engagements with our firm: access to legal counsel that is recognized by the profession for expertise, integrity, and results. When clients retain Dawda attorneys, they benefit from the depth of knowledge and professional standing that comes with sustained peer recognition.

The multi-specialty recognitions received by several of our attorneys—particularly Ed Dawda, Jeffrey Moss, John Mucha, and Susan Sadler—reflect our integrated approach to complex legal matters that often span multiple practice areas. This cross-disciplinary expertise enables us to provide comprehensive counsel on sophisticated transactions and disputes.

The legal profession’s peer recognition through Best Lawyers confirms that Dawda PLC continues to maintain its position among Michigan’s premier business law firms, with the depth of expertise and professional standing necessary to handle our clients’ most significant legal matters.

Dawda PLC is proud to announce that John Mucha III, a distinguished Member of our firm, has been honored with the Litigation Excellence Award from the State Bar of Michigan’s Litigation Section. This prestigious recognition was presented at the Litigation Section’s annual Honors Reception on Wednesday, April 9, 2025, at The Henry Ford Museum of American Innovation in Dearborn.

A Distinguished Recognition

The Litigation Excellence Award recognizes attorneys who embody exceptional qualities in the legal profession, including:

• Involvement in significant legal matters
• Depth of legal knowledge
• Superior written and oral advocacy skills
• Commitment to civility and professionalism
• Outstanding reputation among peers and commitment to the improvement of the legal profession

Recipients of this award are acknowledged for effectively representing their clients, achieving favorable outcomes, and upholding the principles of justice that distinguish them as leaders in the legal community.

A Legacy of Excellence

Mr. Mucha concentrates his practice in general civil litigation, automotive supply chain matters, real estate matters, land use planning, and business disputes. His extensive experience includes representing businesses and property owners in a broad range of matters, from complex contract disputes and automotive supply chain issues to land contamination cases and employment-related agreements.

His litigation expertise encompasses all phases of the litigation process, from initial pleadings and discovery to trials, appeals, and negotiating settlements. Mr. Mucha also serves as a Discovery Mediator for the Oakland County Circuit Court.

Leadership in the Legal Community

Throughout his career, Mr. Mucha has demonstrated leadership within the legal profession. He previously served as Chair of the State Bar of Michigan Litigation Section, President of the Michigan Defense Trial Counsel (MDTC), and as an elected representative to the State Bar of Michigan Representative Assembly.

Mr. Mucha earned his J.D. from the University of Michigan in 1987, where he received a special award for writing and advocacy and served as Contributing Editor of the Michigan Journal of Law Reform. He also holds a Master of Public Policy degree (1979) and a B.A. with distinction (1977) from the University of Michigan.

At the April 9th Honors Reception, Christopher R. Martella of Dawda presented the award to Mr. Mucha. The event also recognized other distinguished members of the legal community, including recipients of the Judicial Excellence Award, Hon. Paul Borman of the US District Court for the Eastern District of Michigan and Hon. Christopher Yates of the Michigan Court of Appeals.

The entire Dawda team congratulates John on this well-deserved recognition of his outstanding contributions to the legal profession and commitment to excellence in litigation practice. This honor further solidifies the firm’s reputation for excellence in litigation services throughout Michigan and beyond.

For more information about the Litigation Section Honors Reception, please visit the State Bar of Michigan website.

As we commemorate our 30th anniversary serving the Michigan business community and beyond, we are pleased to introduce a refined expression of our identity that honors our heritage while embracing the future. Our refreshed brand presence, now simply “Dawda,” reflects the streamlined efficiency that our clients have come to expect from our practice.

This evolution in our visual identity represents not a departure, but a continuation of our foundational principles. For three decades, our firm has built its reputation on providing sophisticated legal counsel while maintaining the personalized attention that distinguishes boutique practices from their larger counterparts. The simplified “Dawda” mark embodies this commitment to clarity and precision in everything we do.

Founding Partner Edward Dawda reflects on this milestone: “When we established this firm in 1995, our vision was to build something that would transcend any individual and serve as a lasting institution in Michigan’s legal community. As we mark our 30th anniversary, this brand evolution reflects not just where we’ve been, but where we’re going. Our refined identity as Dawda honors our heritage while embracing the future of legal practice. The core principles that guided us three decades ago – uncompromising excellence, deep client relationships, and sophisticated counsel – remain unchanged. This refresh simply allows us to better reflect the dynamic, forward-thinking firm we’ve become while staying true to our foundational values.”

The new visual identity, rendered in our signature blue, carries forward our tradition of quiet authority while introducing a more contemporary aesthetic. This refresh aligns with our forward-thinking approach to legal services, even as we maintain the core values and high standards that have defined our practice since its inception.

Our clients can rest assured that while our look has evolved, our fundamental commitment remains unchanged. The same trusted counselors, practice areas, and dedication to excellence that have characterized our firm for thirty years continue unabated. This refinement simply allows us to better reflect the modern, dynamic firm we have become while honoring the strong foundation upon which we have built our practice.

As we move forward under the Dawda identity, we remain steadfast in our mission to provide sophisticated legal solutions that address our clients’ most complex challenges. We look forward to serving our clients and community with the same dedication and expertise they have come to expect, now under a banner that reflects both our heritage and our vision for the future.

We’re pleased to announce that 21 Dawda attorneys have been recognized in DBusiness Magazine’s 2025 Top Lawyers list. This prestigious recognition reflects our firm’s commitment to excellence across multiple practice areas and our continued leadership in the Southeast Michigan legal community.

Our Distinguished Attorneys

The following Dawda attorneys have been named to the 2025 DBusiness Top Lawyers list:

• Randal R. Cole (Labor and Employment Law)
• Brian J. Considine (Environmental Law)
• Edward C. Dawda (Corporate Law)
• Dana Kreis Glencer (Real Estate Law)
• Daniel M. Halprin (Real Estate Law)
• Joseph M. Judge (Real Estate Law)
• Eric A. Ladasz (Litigation – Commercial)
• Christopher R. Martella (Real Estate Law)
• Jeffrey D. Moss (Tax Law)
• John Mucha III (Litigation – Commercial)
• Glenn G. Ross (Trusts and Estates)
• Susan J. Sadler (Environmental Law)
• Marc K. Salach (Corporate Law)
• Todd A. Schafer (Real Estate Law)
• Wayne S. Segal (Banking & Financial Service Law)
• Richard M. Selik (Real Estate Law)
• Neil S. Silver (Environmental Law)
• Tyler D. Tennent (Environmental Law)
• Erin Bowen Welch (Real Estate Law)
• Frances Belzer Wilson (Litigation – Commercial)
• Robert A. Wright III (Banking & Financial Service Law)

Practice Area Excellence

This year’s recognitions highlight our firm’s particular strength in several key practice areas:

Real Estate Law Our real estate practice continues to be one of the largest and most respected in the region, with seven attorneys receiving recognition: Dana Kreis Glencer, Daniel M. Halprin, Joseph M. Judge, Christopher R. Martella, Todd A. Schafer, Richard M. Selik, and Erin Bowen Welch.

Environmental Law Our environmental practice maintains its strong reputation with four recognized attorneys: Brian J. Considine, Susan J. Sadler, Neil S. Silver, and Tyler D. Tennent.

Commercial Litigation Our litigation team’s excellence is reflected in the recognition of Eric A. Ladasz, John Mucha III, and Frances Belzer Wilson.

Additional Practice Areas The breadth of our expertise is demonstrated through recognition in:

• Banking & Financial Services (Wayne S. Segal and Robert A. Wright III)
• Corporate Law (Edward C. Dawda and Marc K. Salach)
• Labor and Employment Law (Randal R. Cole)
• Tax Law (Jeffrey D. Moss)
• Trusts and Estates (Glenn G. Ross)

About DBusiness Top Lawyers

DBusiness Magazine’s Top Lawyers list is curated through a peer-review survey of thousands of attorneys in Wayne, Oakland, Macomb, Washtenaw, and Livingston counties. This recognition represents the judgment and endorsement of fellow members of the Southeast Michigan legal community.

Client-Focused Excellence

This recognition by DBusiness Magazine reinforces our commitment to providing exceptional legal services to our clients. Our attorneys combine deep expertise in their respective practice areas with a thorough understanding of our clients’ business objectives to deliver practical, results-oriented solutions.

DBusiness Magazine’s Top Lawyers list is based on a peer-review survey of certified lawyers within the five-county metro Detroit area. The list is intended to provide a comprehensive guide to legal excellence in our region.

We’re proud to announce that 21 Dawda attorneys have been recognized in the 2024 Michigan Super Lawyers and Rising Stars lists—a testament to our firm’s commitment to excellence and dedication to client service. This impressive recognition includes several attorneys marking significant milestones, with Edward C. Dawda and Susan J. Sadler each celebrating their 19th year of Super Lawyers recognition.

Our Distinguished Attorneys

This year’s honored attorneys include (Rising Star designations noted with †):

• Kristen L. Baiardi† (Business Litigation)
• Kylie E. Bergmann† (Real Estate)
• Alfredo Casab (Business/Corporate, 6th year)
• Randal R. Cole (Employment & Labor, 11th year)
• Brian J. Considine (Environmental, 8th year)
• Edward C. Dawda (Business/Corporate, 19th year)
• Daniel M. Halprin (Real Estate, 5th year)
• Samuel Kokoszka† (Real Estate)
• Christopher R. Martella (Real Estate, 1st year)
• Jeffrey D. Moss (Tax, 8th year)
• John Mucha, III (Civil Litigation: Defense, 15th year)
• Michael Piggins† (Civil Litigation: Defense)
• Glenn G. Ross (Estate & Probate, 8th year)
• Susan J. Sadler (Environmental, 19th year)
• Marc K. Salach (Business/Corporate, 5th year)
• Wayne S. Segal (Real Estate, 18th year)
• Richard M. Selik (Real Estate, 14th year)
• Tyler D. Tennent (Land Use/Zoning, 11th year)
• Erin Bowen Welch† (Real Estate)
• Frances Belzer Wilson (Business Litigation, 4th year)
• John F. Youngblood (Franchise/Dealership, 17th year)

A Legacy of Excellence

This year’s selections are particularly noteworthy, with several attorneys reaching significant milestones. Edward C. Dawda and Susan J. Sadler lead our honorees with 19 years of recognition each, followed closely by Wayne S. Segal with 18 years and John F. Youngblood with 17 years. These achievements reflect not just individual excellence, but our firm’s long-standing commitment to providing superior legal counsel.

Our Rising Stars represent the next generation of legal excellence at Dawda. These exceptional young attorneys—Kristen Baiardi, Kylie Bergmann, Samuel Kokoszka, Michael Piggins, and Erin Bowen Welch—have demonstrated outstanding professional achievement early in their careers.

What Super Lawyers Recognition Means

The Super Lawyers selection process is rigorous and comprehensive, combining peer nominations, independent research, and peer evaluations. Only 5% of attorneys in Michigan receive this distinction, with an additional 2.5% selected as Rising Stars. This recognition reflects our attorneys’ commitment to excellence and their standing among Michigan’s most respected legal professionals.

For our clients, these recognitions reinforce what they experience firsthand: when working with Dawda, they partner with some of Michigan’s most capable and respected legal minds. Whether handling complex business transactions, environmental compliance, real estate development, or litigation, our team brings recognized expertise to every matter.

Looking Forward

As we celebrate these achievements, we remain focused on our core mission: delivering exceptional legal services to our clients. These recognitions motivate us to continue raising the bar, finding innovative solutions to complex legal challenges, and maintaining the highest standards of professional excellence.

Super Lawyers is a rating service of outstanding lawyers who have attained a high degree of peer recognition and professional achievement. The selection process includes independent research, peer nominations, and peer evaluations.

This article was first published in the SBM Real Property Law Section E-Newsletter and was written by Todd A. Schafer

One element of the landlord tenant relationship that has evolved in recent years (a trend accelerated by the COVID-19 pandemic) is the increasing demand from food service tenants for the use of space outside the walls of their demised premises for seating. Such spaces can boost foot traffic, enhance visibility, and increase revenue for tenants. Consequently, landlords are more frequently accommodating these requests – with some landlords actively encouraging the creation and use of such areas. However, the terms and conditions governing these exterior spaces often differ significantly from those applicable to a tenant’s interior premises. It is crucial for the parties to clearly define these terms in writing, whether in the body of the lease, a rider or an addendum to the lease, or a separate license agreement. Key considerations include:

Location:  Will the area be predetermined or agreed upon in the future? Will the space be physically defined (e.g., by fencing, movable planters, etc.)? Are there certain walkways or pathways that need to be kept clear for legal or practical reasons? Does the landlord have the right to alter the dimensions of the area or relocate the area?

Duration:  Is the space available throughout the year? Are there restrictions on operational hours or days? Can the landlord impose temporary closures (e.g., for repairs to the area)?

Improvements and Furnishings: If the lease does not include a specific description or depiction of the allowed improvements and furnishings, what are the landlord’s approval rights with respect to future improvements and furnishings (e.g., quantity, quality, style, location, method of attachment, etc.)? Are there requirements for securing or storing furnishings during periods of non-use or inclement weather?

Costs and Expenses:  Is there an additional fee or rent for using the outdoor area? Is this space factored into pro rata calculations of common area or other shared expenses?

Use Rights and Limitations:  Is the tenant’s use of the area exclusive? Are there conditions or limitations on tenant’s rights to use the area that differ from those for the interior premises (whether due to legal requirements, governmental approvals and permits, existing exclusives and restrictions, additional rules and regulations, etc.)?

Maintenance Obligations:  What specific maintenance responsibilities does the tenant have (e.g., cleaning, snow removal, repairs, etc.)? Can the landlord assume the tenant’s responsibilities (and charge the tenant for the expense), whether or not the tenant is in breach of its obligations? Insurance and Indemnity:  Which party is responsible for the area for indemnity and insurance purposes? Are there any additional terms or changes to the lease terms are needed to cover these obligations?

Landlord’s Remedies:  Does the landlord have additional rights and remedies beyond those specified in the lease applicable to tenant breaches of the terms pertaining to the exterior space (e.g., shorter or no notice periods prior to remedying a tenant default, fines, suspension or termination of the right to use the area, etc.)?

Each space’s specific use and characteristics will inform how these considerations are addressed. For instance, restaurants with outdoor areas serving alcohol are more likely to disturb other tenants, should carry liquor liability insurance, and will need to satisfy additional rules and requirements of the Michigan Liquor Control Commission and the local zoning ordinance.

Granting a tenant rights to an outdoor area should not (at least without thorough consideration) be accomplished by simply including the space as part of the tenant’s leased premises. Rather, the terms and provisions governing the rights and responsibilities related to the exterior space should be thoroughly discussed, clearly defined, and documented in writing to ensure mutual understanding and agreement.