Lease Effective Despite No Owner's Signature

A tenant asked the owner to renew the lease after it expired. The owner drafted a new lease, which increased the minimum rent. The tenant's president signed the new lease, but the owner didn't. The owner sent the tenant a letter terminating the tenant's right to occupy the space. The tenant stayed in the space and paid the increased rent, which the owner accepted. Eight months later, the owner sent the tenant a second letter terminating the tenant's right to occupy the space, claiming that no lease was in effect between them. The tenant argued that the new lease was effective even without the owner's signature.

A Louisiana appeals court ruled that the new lease was in effect, even though the owner didn't sign it. So the tenant could stay in the space. Louisiana law says that if an owner drafts a lease and presents it to the tenant for signing, the lease is valid and binding when the tenant accepts it—even if the owner doesn't sign it. Plus, the owner's actions indicated that the new lease was in effect. The owner didn't enforce the first termination letter once the tenant paid the increased rent, and it accepted the tenant's increased rent payments for eight months. Also, the owner had a history of conducting business with the tenant without requiring documentation. So the parties' interactions weren't defined solely by signed documents, noted the court [Enterprise Property Grocery, Inc. v. Selma, Inc.].