(1)          Client is the owner of a small commercial building and enters into what is essentially a “rent-to-own” Agreement for the lease and sale of the building to a Corporation; terms of which are 8 quarterly payments and then a final balloon.  The Agreement isn’t terribly drafted, but was not the work of an attorney.  The Agreement and payments to be made thereunder is personally guaranteed by the owner of the Corporation.

(2)          Corporation filed Articles of Incorporation in Iowa a few months after signing Agreement.  Corporation’s registered agent (Corporation Service Company) resigned a few months ago and there is no listed registered agent today.  Corporation defaults on its rent/lease/Agreement payments by missing last two quarterly payments and now the final balloon.  Corporation (and its owner) cannot be found anywhere at this point.  All addresses where notices are sent are returned as undeliverable.  Corporation (and its owner) are believed to be in the state of Virginia, but mailings have been returned as undeliverable.  I did check and Corporation is not organized in Virginia, so I believe it is only an Iowa corporation.

(3)          The Agreement does contain a clause that provides that in the event Tenant defaults “Landlord may re-enter the Leased Premises and remove all persons and property therefrom, with such property to be stored in a public warehouse at the cost and expense of Tenant”.

My concern here is whether this “self-help” eviction would hold up if the Corporation suddenly re-emerges someday claiming rights under the Agreement, tendering payment for the Agreement, making claims for its property, etc.

My thinking is that it would be wiser to simply terminate the Agreement as a default of rental agreement; file FED if necessary; and lawfully evict to cut off any of Corporation’s rights.  However, this could also be incredibly difficult if we can’t locate Corporation or its owner.  Would Iowa Code Section 490.504 be of benefit to me as a first step for termination?  If I then file an FED, what service issues am I going to run into if I can’t locate Corporation or its owner and how can I overcome them?

Thanks for any thoughts.

Kyle A. Marcum

Attorney at Law

Watson & Ryan, P.L.C.

535 West Broadway Suite 200

P.O. Box 646

Council Bluffs, IA 51502

Telephone (712) 322-0448

Facsimile  (712) 256-1545

kmarcum@watsonryan.com

114 West Main Street, Suite C

Clarinda, IA 51632

Telephone (712) 542-1150

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