Owner Wins, Owner Loses

Tenant in Chapter 11 Can't Assume Lease that Expired Before Bankruptcy Filing

February 27, 2024    

What Happened: Wracked by COVID-19 financial struggles, a restaurant filed for Chapter 11 bankruptcy while continuing to operate its restaurant in Chicago’s prestigious Magnificent Mile District as a debtor-in-possession with hopes of assuming the lease after being...

Failure to Satisfy Contractor’s Lien Costs Franchise Tenant Nearly $1 Million

February 27, 2024    

What Happened: After receiving a notice to file claim from a contractor who didn’t get paid for fire prevention work performed on a Boston Market restaurant, the landlord notified the tenant leasing the property that it was in default of the lease and gave it 30 days to...

Did Sewer Backups Give Tenant Right to Terminate for “Untenantability”?

February 27, 2024    

What Happened: Blockages in sewer pipelines located outside the property caused a constant stream of sewer backups inside a tenant’s store. Eventually, the tenant decided that enough was enough and vacated the premises. When the landlord sued for unpaid rent, the tenant...

Not Negotiating Renewal Rent Increase Doesn’t Make Landlord Guilty of “Unclean Hands”

January 30, 2024    

What Happened: A shopping center sent an email asking a restaurant tenant to renew its lease at an increased rent. The tenant signed the attached amended lease without reading it. Five years later, it vacated the property and stopped paying rent. The landlord served the tenant...

Tenant Not Liable for Accident in Parking Lot Under Landlord’s Control

January 30, 2024    

What Happened: An exterminator working for Best Buy suffered serious injury after slipping and falling in the store’s icy parking lot. He sued Best Buy and the landlord that owned the property for negligence. Best Buy denied responsibility for maintaining the parking lot...

Oral Lease Modification Doesn’t Get Good Guy Guarantor Off the Hook

January 30, 2024    

What Happened: The landlord sued a dry-cleaning tenant for nearly $200,000 in damages, including $46,733 in unpaid rent that accrued up to the time the tenant vacated. It also went after the good guy guarantor that “unconditionally, irrevocably and as a primary obligor...

Court Temporarily Bars Landlord from Terminating Restaurant Lease

December 27, 2023    

What Happened: An Italian restaurant tried to assign its lease to a steakhouse, but the landlord refused and served notice of termination. The tenant denied committing any lease violation and asked the court to issue a temporary injunction barring the landlord from terminating...

Physically Absent Tenant Can Still Hold Over After Lease Expires

December 27, 2023    

What Happened: At first it looked as though the tenant had found a buyer for his dental practice to whom it would assign the lease just as it was expiring on Dec. 31, 2019. But the deal fell through, and the tenant sent the landlord an email in February notifying it of his...

Liquidated Damages Clause Is an Unenforceable Penalty

December 27, 2023    

What Happened: The COVID-19 pandemic forced the owner of an iconic cinema in Minneapolis to shut down and default on its lease with six years left in the term. The landlord sued for liquidated damages of $1.8 million, including $364,212 in unpaid rent and $1,444,258 representing...

Not Unconscionable to Make Defaulting Tenant Pay Costs of Remodeling Premises

November 28, 2023    

What Happened: Eighteen months after signing a five-year lease, a rug store went into liquidation, stopped paying rent, and abandoned the premises. The landlord then divided the space into two separate units, leasing one to another rug store and the other to a bath floor décor...

Blaming Business Losses on Landlord’s Failure to Plow Snow Is ‘Mere Speculation’

November 28, 2023    

What Happened: A tenant leased property on a pair of shopping center outlots to operate restaurants. The ground lease required the tenant to pay a pro-rata share of the CAM costs the landlord incurred to keep the common areas in good repair. The landlord sold the property to a...

Licensor Can't Bring Unlawful Detainer Lawsuit Against Licensee in Breach

November 28, 2023    

What Happened: A studio owner entered into a “License Agreement” giving a production company “the exclusive,” but “non-possessory” right to use the property. The production company defaulted on its rent payment and the owner brought an “...