Owner Not Responsible for Holdover Tenant's Damaged Property

August 31, 2006

July 18, 2006—A tenant rented space for a store next door to an inn. Although its lease expired in December 2003, the tenant didn't move out. In November 2004, a boiler problem at the inn caused flooding and a loss of electrical power at the tenant's store, and ruined the tenant's inventory. The tenant moved out in February 2005 and sued the owner for damages resulting from the loss of inventory and business. The owner argued that the lease made the tenant responsible for damage caused by the flooding.

July 18, 2006—A tenant rented space for a store next door to an inn. Although its lease expired in December 2003, the tenant didn't move out. In November 2004, a boiler problem at the inn caused flooding and a loss of electrical power at the tenant's store, and ruined the tenant's inventory. The tenant moved out in February 2005 and sued the owner for damages resulting from the loss of inventory and business. The owner argued that the lease made the tenant responsible for damage caused by the flooding. The tenant argued that the owner couldn't rely on the lease's terms, because the lease had ended before the flood occurred.

A Maine court dismissed the tenant's lawsuit. The lease's holdover clause said that if the tenant stayed in the space beyond the lease term, it would be “considered a tenant at will on all of the terms and conditions of this Lease.” So the lease still applied to the tenant as a holdover tenant. The lease also said that the tenant's property “shall be held at Tenant's sole risk” and that the owner “shall not be liable for any loss, damage or destruction of any such property by fire, theft or any other cause.” So the owner wasn't responsible for the damage to the tenant's personal property, said the court. Plus, under the lease, the owner wasn't responsible for the loss of the tenant's retail space or helping to rehabilitate the tenant's business, added the court.

  • Small v. Durango Partners, LLC: No. CV-05-668, 2006 Me. Super. LEXIS 168 (Me. Super. Ct. 7/18/06).

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