Jury Must Decide Whether Owner Had Rejected Lease

A lease let an owner relocate its tenant to a similar space within the same building. During the lease, the building's property manager told the tenant that the owner wanted its space and the tenant would be relocated to a space needing renovation in a different building in the same office complex. No moving date was given. Later, the owner's staff came to the tenant's space to take measurements. Because the tenant's business had shifted out of town and the tenant saw the planned relocation as a violation of the lease, the tenant told the property manager it would leave the office complex. The property manager notified the tenant that it was still responsible for its lease obligations. The tenant, however, stopped paying rent. The owner sued. The tenant argued that the owner, through its actions and words to the tenant, had rejected (or “unconditionally repudiated”) the lease and that the owner's actions were tantamount to an eviction (legally speaking, a “constructive eviction”).

A Minnesota appeals court refused to dismiss the tenant's arguments, ruling that a jury must determine whether the owner had unconditionally repudiated the lease and/or the tenant was constructively evicted. The evidence, including the fact that the owner's staff took measurements of the tenant's space, showed that the relocation was inevitable, said the court. The tenant felt it had no choice in the matter; it had to move out of its space, disrupting its business. Whether the owner's actions and words were an “unconditional repudiation” of the lease, whether the tenant tried to escape its lease, and whether the threat of relocating the tenant was of a “grave” nature resulting in constructive eviction were all questions that a jury—not the court—must decide, said the court [Maddox Scientific, Inc. v. Wooddale Builders, Inc.].