Owner Can't Use Claim Against Tenant to Avoid Return of Overpaid Rent

September 30, 2004

A tenant claimed that it mistakenly overpaid its rent by $232,899 and asked the court to require the owner to return that amount. But the owner argued that it was unclear how much it owed the tenant. It claimed that the tenant had violated its lease by failing to repair the parking lot on the property and said that liability should offset the overpayment.

A tenant claimed that it mistakenly overpaid its rent by $232,899 and asked the court to require the owner to return that amount. But the owner argued that it was unclear how much it owed the tenant. It claimed that the tenant had violated its lease by failing to repair the parking lot on the property and said that liability should offset the overpayment.

A federal court in Louisiana ordered the owner to return the $232,899 overpayment to the tenant. The owner may not use the parking lot claim to stop the tenant from getting back its full overpayment. That claim hadn't been “liquidated—that is, it wasn't settled and capable of being determined by mere calculation. Because the owner's claim couldn't be determined by mere calculation, the court couldn't consider whether the owner was entitled to an offset or payment by the tenant, the court pointed out. Plus, it was unclear if the owner could even win on its parking lot claim [A. Levet Props. P'ship v. Bank One, N.A.].

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