On occasion, a troubled commercial tenant, in an effort to regain financial footing, might ask the landlord for a short-term decrease in its monthly rental obligation.

In exchange, the tenant may offer the landlord an increase in future payments that would more than offset the temporary reduction.

When faced with such a proposal, how should the landlord respond?

On the one hand, the landlord may simply refuse to deal. If the tenant can’t afford to pay rent at the current level, then it will be evicted. But if the tenant’s financial health was actually going to improve, then evicting right away may have been the wrong move. The landlord will have abandoned a steady stream of rental income, only to be left with vacant space that might lay fallow for a long time.

Alternatively, the landlord could give the tenant a temporary break, decreasing the rent in the short run in exchange for an even bigger increase down the road. However, if the tenant’s prospects don’t eventually improve, such that it can’t even pay the reduced amount, then the landlord should never have cut the tenant a deal in the first place.

There is no single formula that will instruct a landlord what to do when confronted with a struggling tenant. As in most difficult situations, identifying the best course of action involves more art than science.

The following five strategies, or some combination of them, will rise to meet just about any challenge.

Demand Proof

Tenants often claim that funds are on the way. Variations on this common theme include: "We’re about to close on a loan." "We expect to receive payment on a large receivable soon." "We’re getting another round of financing next month."

Don’t believe the hype. Instead, demand certified copies of the tenant’s financial statements, bank accounts and whatever else may be relevant to evaluate the tenant’s claim. If the tenant is being honest, there should be no problem proving the fact. If the tenant won’t cooperate, the landlord should take its assurances with a very considerable grain of salt.

Get Security

Ideally, the landlord already has security. Maybe it’s a personal guarantee from the tenant’s wealthy principal. Alternatively, it could be a letter of credit from a bank. Perhaps it’s both. Whatever form the security takes, it may be the landlord’s only hope for recovery – so it better be good.

Unfortunately for the landlord, if the tenant is doing poorly, the existing security may also be underwater. For example, the tenant’s CEO, who guaranteed the lease, may have mortgaged away all of the equity in his or her expensive residence. When confronted by a tenant asking for an adjustment, ask the tenant for proof of the existing security’s value and solvency. If it appears shaky, and maybe even if it doesn’t, demand more security before cutting the tenant any breaks. And if the landlord doesn’t already have security, now is a good time to demand it.

Don’t Wait

As soon as the tenant is late, send a default notice. File an eviction action at the earliest possible opportunity. It doesn’t matter that the landlord may also be negotiating with the tenant. Consider moving on both the litigation and negotiation fronts simultaneously.

There are at least two good reasons to proceed along dual tracks. First, a lawsuit can serve as a powerful backdrop to negotiations. Faced with a credible threat of eviction, the tenant will be loath to hold out for unreasonable demands. Second, even relatively quick eviction suits, called "summary process" actions, take time. If negotiations ultimately lead nowhere, a landlord that has already filed suit will be that much closer to kicking the non-paying tenant to the curb.

Freeze Accounts

Every month the landlord receives a rent check or an electronic transfer of funds from the tenant. The landlord knows where the tenant does its banking. If the tenant is late in paying, the landlord should consider filing suit and asking the court to freeze the tenant’s bank account.

If the court allows the landlord’s motion for "trustee process attachment," the bank will freeze the tenant’s account, and hold the funds as security for the landlord. A victory on a trustee process motion will often force the tenant to agree to the landlord’s demands, as the tenant feels the pain of having its bank accounts frozen. It will also provide some assurance that the funds will be there when the landlord ultimately wins its suit for unpaid rent.

Evict Them

If negotiations fail, or if the tenant’s assurances are unconvincing, the landlord should move forward with the eviction. It’s time to replace the deadbeat tenant with a paying one.

Summary process rules allow landlords to evict tenants with relative dispatch. Such cases move faster than typical commercial lawsuits. In some circumstances, the landlord might be able to move the case along even faster if it limits the suit to recovering possession of the property, and reserves the right to recover unpaid rent and other damages in a subsequent suit. Landlords should discuss the possibility of bifurcating these two issues (possession and money damages) with their litigation counsel.

Which of these strategies will work best depends on the circumstances. Landlords would be well advised to consider, along with their litigation counsel, each of them. One or more will likely hold the key to protecting the landlord’s valuable investment, and restoring its property to revenue-generating status as quickly as possible.

Adam N. Lewis is a partner at Lewis & Kaplan LLP, a Newton-based boutique law firm specializing in litigation.