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What Happened: Six months after an executive recruiting agency moved into its new office, employees began experiencing rashes and congestion while at work, problems that eased as soon as they left the building. Dissatisfied with building management’s response to its complaints, the agency moved out and sued the landlord for recission and negligence in failing to maintain the building’s HVAC and ventilation system. The landlord countersued the agency for failure to pay rent.
What Happened: A medical tenant decided to remain in possession and continue paying rent after its lease expired. A few months later, Hurricane Irene blew through town and inflicted major damage, forcing the tenant to move out. The tenant sued to recover its security deposit; the landlord countersued to recover the costs of rebuilding, noting that the tenant had parked its car inside the building before the storm, in violation of the lease, and that the car was forced through the wall by the rush of floodwater in the building.
What Happened: A landlord terminated the month-to-month lease of a toy wholesaler. When the tenant refused to leave, the landlord filed a holdover lawsuit. After several failed attempts by the tenant to get the action dismissed or stayed, the case went to court, which ruled in the landlord’s favor and issued an eviction warrant. The tenant filed for Chapter 11 bankruptcy a week before the warrant was scheduled to be executed.
What Happened: A landlord promised to install fencing around a used car lot if the tenant renewed the lease. Relying on that promise, the tenant re-upped, but the landlord didn’t install the promised fencing. So, the tenant terminated the lease, stopped paying rent, and sued for misrepresentation. The trial court found the landlord liable for fraud.
What Happened: Courts around the country continue to rule against tenants seeking to use the COVID-19 pandemic as an excuse for not paying rent. One of the more creative cases involves a fitness center tenant that had to close from March through September 2020 due to shutdown orders. The tenant relied on the following language in claiming that it didn’t owe the landlord rent for the period:
What Happened: A lease required a medical tenant to reimburse the landlord for the costs of improvement made to the space if it terminated early. The tenant did terminate early, and the landlord billed it for $108,000 in improvement costs. The tenant refused to pay, contending that the landlord owed it money under a separate Professional Services Agreement (PSA) involving the parties that had been signed five years earlier.
What Happened: A shopping center lease allowed the tenant to use the premises “solely for a tobacco, cigar, and vape store,” and “for no other purpose unless approved in writing by” the landlord.
What Happened: A convenience store tenant signed a lease requiring it to carry certain insurance at its sole cost and expense during the lease term, including at least $1 million in general liability insurance, worker’s compensation insurance required by law, and plate glass insurance. The tenant also agreed that it would obtain the liability insurance from a reputable and independent insurer rated at least “A” by Best’s Insurance Guide. The tenant kept none of these promises, and the landlord sued to evict.
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