Tenant Granted Use of Extra Space Not Liable for Extra Rent

April 28, 2009

Facts: A tenant agreed to lease space in a strip mall. The tenant leased only one space, but at the time the lease was signed, the space was not big enough for the tenant to run its business. To accommodate the tenant, the owner offered to let the tenant use an adjacent space until it could modify the leased space. The tenant took over the space.

Facts: A tenant agreed to lease space in a strip mall. The tenant leased only one space, but at the time the lease was signed, the space was not big enough for the tenant to run its business. To accommodate the tenant, the owner offered to let the tenant use an adjacent space until it could modify the leased space. The tenant took over the space.

Two years later, the owner still hadn't modified the tenant's leased space. A new owner bought the strip mall and eventually asked the tenant to pay rent for both spaces. The tenant filed for bankruptcy, and the owner asked the bankruptcy court to order the tenant's estate to pay additional rent for both spaces.

Ruling: An Illinois bankruptcy court ruled against the owner.

Reasoning: The lease allowed the tenant to occupy the adjacent space until the owner modified the leased space, and did not require additional rent. The court found that since the owner never modified the leased space, the tenant did not have an obligation to pay additional rent.

  • K&P Automotive v. Ashok Parida, February 2009

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