Well, another holiday weekend has rolled around. When that happens, we try to stay away from technical or detailed topics and just Ruminate about things that trouble us. We try to throw out some easily digestible thoughts and await the bounce-back. Today’s posting meets those criteria, but after hacking out today’s blog posting, we were haunted by two old quotations. Both are almost certainly wrongly attributed to Samuel Clemens a/k/a Mark Twain. But, that doesn’t make them any less disturbing.
The first is: “What gets us into trouble is not what we don’t know. It’s what we know for sure that just ain’t so.” The other is: “When I was a boy of fourteen, my father was so ignorant I could hardly stand to have the old man around. But when I got to be twenty-one, I was astonished at how much he had learned in seven years.”
Guilty on both counts.
Here’s the puzzle, one that wasn’t a puzzle when we were younger. Isn’t ignorance beautiful? Imagine this situation. There’s a shopping center lease executed in 1976, 40 years ago, and it has run out of extension options (then probably called “renewal” options). The lease has worked well. In fact, over the 40 years, no one ever dragged it out to look anything up other than to see what had to be done to exercise one of those extension options.
Now, the parties want to extend the leases term by another 10 years and add two 5- year extension options beyond that ten. They also want to make six discrete business changes.
Many readers have been there.
Do you update the lease? By update, Ruminations means replace it with today’s hottest and greatest form, one that has absorbed all of the horror stories every heard of, true or not. Do we reflect any changes in the relative bargaining power of the parties from that of 40 years ago?
Here is our provocation for today:
Ruminations has long adhered to the wisdom of another quotation, also one with a challenged attribution: “If it ain’t broke, don’t fix it.” A much more appropriate expression of the same thought is this newly discovered one: “If it ain’t broke, don’t break it.” [We are too old to remember if we ever thought differently, but are sure that once we really pondered the issue, this is where we would have come out.]
On our side is the “proof of the pudding” [don’t invite us to go off on another tangent about that saying]. Though “past performance is not an indicator of future results,” and most of us ignore this warning, there is a lot to be said about how the world works. When we write a lease afresh, we try to anticipate everything that might happen during the lease’s term. Nonetheless, we don’t cover everything for reasons that include using our judgment to skip over the silly things (the possibility of alien abduction, for example), not being sufficiently prescient, and just plain incompetence. Yet, despite these shortcomings, we feel confident that we’ve covered everything.
In contrast, we have 40 years of experience with the hypothetical 1976 lease. If that lease was deficient, we’d know it and could cover the situation when doing a lease extension-amendment agreement. The deficiency would be known by both parties. If that wasn’t the case, the “deficiency” would be just something one party wants, but the other party doesn’t yet know it.
Ruminations is quite capable of making the “other side’s” argument in favor of an entirely new lease, but won’t. That’s because our children long ago celebrated their 21st birthdays.
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