CAM Charges Dispute: What to Do When the Year-End Reconciliation Does Not Add Up

Last updated: November 2026. Reviewed by Pavel Kolmogorov, California business litigation attorney (State Bar No. 321018).

A year-end common area maintenance (CAM) reconciliation is a bill under your lease, and you owe only what the lease lets the landlord pass through. California has no general statute that sets CAM charges for most commercial tenants, so the lease language controls, including any audit deadline. Since January 1, 2025, qualified small tenants under covered leases can also demand supporting documentation, due within 30 days of a written request. (Civ. Code, § 1950.9.) Kolmogorov Law, P.C. handles these disputes for tenants and landlords in Orange County and Los Angeles.

Call (909) 235-6116 or contact us online to discuss a reconciliation statement you believe is wrong, or a tenant who has stopped paying one.

When the reconciliation statement arrives

Under most multi-tenant leases, the tenant pays estimated operating expenses every month, and after year-end the landlord compares the estimates to actual costs and bills the difference. The statement is often one page: total expenses, your percentage, estimates paid, balance due in thirty days.

Then the number comes in at double last year's, with no invoices behind it.

Do three things in the first week. Read the operating expense article and the audit clause of your lease, start to finish. Calendar every deadline the lease sets for objecting. Then ask the landlord, in writing, for the general ledger and the invoices that support each expense category.

What the lease says CAM charges are

"CAM," "operating expenses," and "triple net charges" have no fixed legal meaning for most tenants. A court starts with the words: clear and explicit lease language governs. (Civ. Code, § 1638.) The lease is read as a whole, each clause helping to interpret the others. (Civ. Code, § 1641.) If real uncertainty remains after the ordinary rules are applied, the language is interpreted most strongly against the party who caused the uncertainty. (Civ. Code, § 1654.) On a landlord's form lease, that party is usually the landlord.

That is why the exclusions list often matters more than the definition. A broad definition followed by a short exclusions list favors the landlord.

Where CAM overcharges usually hide

When I review a reconciliation, the same handful of problems account for most of the disputed dollars.

Capital items billed as one year's expense, such as a roof replacement or a repaved parking lot, when the lease excludes capital costs or requires them to be amortized.
Management or administrative fees charged as a percentage of costs the fee should not touch, including a fee calculated on top of another fee.
A pro rata share built on the wrong denominator, for example leased area instead of leasable area, which shifts vacancy costs onto the remaining tenants.
Gross-up adjustments applied to fixed costs, or applied at all when the lease does not allow them.
Costs that benefit one tenant or the landlord alone, like leasing commissions, another tenant's build-out, or expenses already reimbursed by insurance.

Each one is a question about what this lease permits.

Audit rights and the deadlines that end them

Many leases give the tenant a right to inspect the landlord's books, and nearly all of them attach a clock. Some make the statement binding if the tenant does not object in time, require payment before any audit, or bar auditors paid on contingency. Others shift the audit cost to the landlord when the overcharge passes a stated percentage.

If the lease is silent, a tenant is not without tools. A breach of contract action carries a four-year limitations period when the lease is in writing. (Code Civ. Proc., § 337, subd. (a).) An accounting claim can force the numbers into the open, and the implied covenant of good faith limits how a landlord uses discretion the lease gives it. Still, a short contractual deadline can cut off a claim long before four years pass.

Paying under protest versus withholding

Withholding the disputed amount feels fair. It is also the fastest route to a three-day notice, because many leases define reconciliation balances as rent. In a commercial eviction the landlord may demand an amount clearly identified as an estimate, and an estimate within 20 percent of what is finally found due is presumed reasonable. (Code Civ. Proc., § 1161.1, subds. (a), (e).) Our page on commercial evictions covers that process.

In most cases the safer course is to pay the undisputed portion, pay the rest with a written reservation of rights, and then audit. Whether a payment made under protest preserves the refund claim depends on the lease, so the reservation should be explicit every time.

The 2025 rules for qualified commercial tenants

A statute that took effect on January 1, 2025 changed the picture for the smallest tenants. A landlord may not charge a qualified commercial tenant a fee to recover building operating costs until it provides supporting documentation, which is due within 30 days of a written request. (Civ. Code, § 1950.9, subds. (a), (b).) The statute applies only to leases signed or renewed on or after that date, month-to-month and shorter tenancies, and older leases with no operating cost provision. (Civ. Code, § 1950.9, subd. (i).) Our page on SB 1103 and qualified commercial tenants explains who qualifies, the notice the tenant must give first, and the remedies.

If you are the landlord

A tenant who refuses to pay a reconciliation is usually a tenant who was handed a number without an explanation. Send the backup with the statement, and check the pro rata math against the current rent roll before the tenant's auditor does. Before serving a default notice, confirm that every line is chargeable under this tenant's lease, not the building's standard form. An overstated demand can cost the landlord the eviction case and, where the lease has a fee clause, the tenant's attorney fees.

How we handle a CAM dispute

We start with the lease and build a schedule that tests each expense category against the definition and the exclusions. Where the dollars justify it, we bring in a lease auditor or forensic accountant. Many disputes resolve on a documented demand. Those that do not are filed as breach of contract and declaratory relief claims in the Orange County Superior Court or the Los Angeles Superior Court. Our commercial lease disputes guide covers the wider set of landlord and tenant claims.

What to bring to the first meeting

The full lease with every amendment, exhibit, and estoppel certificate.
Reconciliation statements and monthly estimate invoices for the last three or four years.
Any backup the landlord has produced, and your written requests for more.
Proof of what you have paid and any letter reserving your rights.

Frequently asked questions

Our landlord's year-end CAM reconciliation is double last year's and came with no backup. Do we have to pay it?

You owe what the lease permits the landlord to pass through, and no more. Under California law the lease language controls, so start with its operating expense definition, exclusions, and audit clause. Refusing to pay risks a default notice, so many tenants pay under a written reservation of rights while the audit proceeds.

What are CAM charges in a commercial lease?

CAM charges are the tenant's share of the cost of operating and maintaining a building or shopping center, such as landscaping, lighting, security, and parking lot repairs. California does not define the term by statute for most commercial tenants. Each lease defines which costs are included, which are excluded, and how the tenant's percentage is calculated.

Can a commercial landlord pass through a new roof as a CAM charge?

Only if the lease allows it. Many California commercial leases exclude capital expenditures or require the landlord to spread the cost over the useful life of the improvement. Others permit capital items that reduce operating costs or are required by law. If the language is unclear, the uncertainty is generally interpreted against the party who caused it. (Civ. Code, § 1654.)

How long do I have to dispute a CAM reconciliation in California?

The lease usually sets the deadline, and it may be short. Some leases treat a statement as final if the tenant does not object within a stated period. Apart from the lease, a claim on a written contract generally must be filed within four years under California law. (Code Civ. Proc., § 337, subd. (a).) The shorter lease deadline is the one to watch.

I run a small restaurant and my landlord will not show me the invoices behind the operating expense bill. What are my rights?

That depends on your size and your lease. A California restaurant with fewer than 10 employees is a qualified commercial tenant if it gave the landlord written notice and a self-attestation of headcount within the past 12 months and, for most leases, at or before signing. If the lease is one the statute covers, the landlord owes it supporting documents within 30 days of a written request. (Civ. Code, § 1950.9, subds. (a), (h), (i).) A larger restaurant relies on its audit clause or, in some cases, an accounting claim.

Talk to a California commercial lease attorney

If a CAM reconciliation does not match your lease, or a tenant is refusing to pay one, call (909) 235-6116 or contact us online. Kolmogorov Law, P.C. is located at 327 Magnet, Irvine, CA 92618, and represents tenants and landlords in Orange County, Los Angeles, and throughout California.

This page provides general information about California law and is not legal advice. Outcomes depend on the lease, the facts, and the court.