Meeting Requirements for Preliminary Injunction

Q: I’m trying to change the synergy at my shopping center to make it more high-end. In the process, I’ve decided to terminate the leases for some of the less upscale retailers there. I complied with the termination requirements in my lease with one of these tenants, but it refuses to move out of the space. The process of revamping the center is slow but steady. There hasn’t been any interest yet in the holdover tenant’s space, and I don’t plan to use the space for anything in the near future, but I’m considering asking a court for an injunction to force the tenant to move out quickly. Is it worth my time and effort to pursue an injunction rather than other legal remedies to remove the tenant?

A: In your scenario, you’re unlikely to get an injunction. Generally, in order to get an injunction, an owner would have to show that there is no other adequate remedy at law and that the tenant’s holdover is causing a permanent and continuing injury. Here, you could pursue other ways to evict the tenant. And, it sounds like you don’t have a sense of urgency in replacing the tenant and aren’t afraid of losing the opportunity to rent to a replacement tenant. The redevelopment of the center seems to be gradual.

An Alabama airport owner learned the hard way that its inability to show that an injunction was the only way of resolving a holdover situation and that the holdover would irreparably harm it meant that it wasn’t entitled to an injunction and would have to pursue its other remedies. There, the owner leased space to a tenant that would provide gas, supplies, and other goods and services to customers flying into the airport. The lease could be terminated by either party with 90 days’ notice. The owner gave notice to the tenant, but the tenant refused to vacate the premises. The owner asked a circuit court for a preliminary injunction—that is, an order from the court forcing the tenant to move out of its space immediately. The court granted the owner’s request. The tenant appealed.

An Alabama appeals court noted that the prevailing rule is that an injunction ordinarily is not available to a landlord for the recovery of possession of the premises except where there is no adequate remedy at law and the landlord is threatened with a permanent and continuing injury. The appeals court pointed out that Alabama law provides various legal remedies pursuant to which a commercial landlord may regain possession of premises wrongfully withheld by a holdover tenant—for example, a common-law action of ejectment, a statutory action of ejectment, or an unlawful-detainer proceeding. But the owner didn’t present any evidence indicating that those legal remedies wouldn’t be adequate or that it was being threatened with a permanent and continuing injury, the appeals court said.

While the owner testified that some of its customers had expressed dissatisfaction with the tenant’s services, none of that testimony established “irreparable injury” to the owner that cannot be adequately redressed through legal remedies, the appeals court stressed. According to the owner, the tenant’s role at the airport was important because it was the first thing that incoming passengers saw, and, therefore, they might decide to bring their business to the area if it made a good first impression. The owner emphasized that the town is “continually in a recruiting process for and competing with other communities for economic development projects,” which is why a good first impression was important.

But the appeals court decided that the owner’s speculation that a poor performance by the tenant could potentially damage the community’s chances at having businesses choose to operate there, “doesn’t establish the probability of permanent, irreparable injury to the owner—even if the appeals court could consider the potential economic impact to the county in general.”

The appeals court also didn’t agree with the owner’s arguments that, in order to obtain a writ of possession through an ejectment action or an unlawful-detainer action, it would have to await a long process and it could be irreparably damaged in the meantime. “The possibility that, during litigation, some as yet unidentified industrial representative may be so outraged by the tenant’s performance that it will reject Dallas County as an investment opportunity on that basis alone does not suffice,” said the appeals court.

The owner failed to prove that it: (1) had no adequate remedy at law; or (2) would suffer irreparable injury absent the granting of the injunction. Accordingly, the appeals court reversed the circuit court’s judgment and sent the case back to the lower court for an opinion consistent with the appeals court’s judgment [Selma Air Center, Inc. v. Craig Field Airport and Industrial Authority, May 2016].