Not Too Late to Sue for Overpaid Rent

March 1, 2003

A lease required the tenant to pay both minimum rent and percentage rent. The tenant overpaid its rent by over $75,000 because of a calculation error. On many occasions, the tenant asked for reimbursement of the overpayment, but never got any money back. So the tenant sued the owner. The owner asked the court to dismiss the lawsuit because the statute of limitations—that is, the time in which the tenant had to begin a lawsuit—had expired. The court dismissed the lawsuit. The tenant appealed, saying that the lower court shouldn't have applied a three-year statute of limitations.

A lease required the tenant to pay both minimum rent and percentage rent. The tenant overpaid its rent by over $75,000 because of a calculation error. On many occasions, the tenant asked for reimbursement of the overpayment, but never got any money back. So the tenant sued the owner. The owner asked the court to dismiss the lawsuit because the statute of limitations—that is, the time in which the tenant had to begin a lawsuit—had expired. The court dismissed the lawsuit. The tenant appealed, saying that the lower court shouldn't have applied a three-year statute of limitations.

An Alabama appeals court reinstated the lawsuit. The court said that the written lease was a contract and so the overpaid rent dispute was governed by the statute of limitations for contract disputes, which was six years and hadn't expired. The court sent the case back to the lower court to determine how much, if anything, the owner owed the tenant in overpaid rent [Wal-Mart Stores, Inc. v. Anniston Development Co.].

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