Owner Loses

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Facts: A tenant that operated a gym received a notice from the owner of its space ordering it to obtain the proper permits to operate its business, which were required by its lease. The tenant asked a New York trial court for a Yellowstone injunction, which would toll—that is, pause—the period to cure the alleged violations of the lease. The tenant claimed that it was still in the process of obtaining the necessary approvals and permits.

Decision: A New York trial court granted the Yellowstone injunction.

Facts: A grocery store customer who slipped and fell on ice in the strip mall’s parking lot sued the grocery store tenant, the center’s owner, and the snow-removal contractor and subcontractor for her injuries. She asserted that they all had a duty of care to keep the parking lot free of ice that posed a danger to customers. All four parties asked a trial court for a judgment in their favor without a trial, and a trial court ruled in their favor. The customer appealed.

Decision: A New Jersey appeals court affirmed.

Facts: A tenant and owner negotiated a four-month lease for commercial space, with an option to renew on a month-to-month basis. The tenant failed to pay rent for two months in a row, but asked the owner to extend the lease for an additional month past the original lease term. The owner agreed to the extension, provided that the tenant pay past due rent and fees and pay the additional month’s rent. The tenant agreed, but ultimately failed to follow through with the correct number of rent payments.

Facts: A restaurant tenant faced with an eviction order offered the owner of the space $40,000 to extend the time it could use the space after it was supposed to vacate. The tenant wanted to use the extra time to work out a deal with a potential buyer of the restaurant, who planned to use the same space. The deal fell through, however. In the meantime, the tenant tried to remove some of its trade fixtures and equipment; the owner’s representative refused to allow this.

Facts: A national pet product retailer received a notice of default and termination from the owner of the space it rented. The owner alleged that the tenant had failed to perform its maintenance obligations under the lease, most notably, failing to fix a large crack in a wall, which entitled the owner to terminate the lease. But the tenant argued that the lease terms allowed a cure period—that is, a period of time after it received the default notice during which it could perform the repairs.

Facts: A tenant negotiated a lease that granted it an ongoing right to terminate its obligations in the event of a sale or relocation of its business. Specifically, the lease stated that, “provided the Tenant is selling or moving the business, Tenant shall have the ongoing right to terminate its obligations…upon twelve (12) months’ written notice to Landlord.”

Facts: An owner and tenant signed a lease for office space, whereby each party would perform renovations to the space to convert it from industrial to office space. The owner was to perform its renovations first. After the owner missed the deadline to turn the space over to the tenant with the completed renovations—a material breach—the tenant notified the owner that it planned to terminate the lease.

Facts: A national department store tenant withheld its rent and engaged in self-help remedies after the owner of the shopping center repeatedly failed to repair problems with the building, including leaking plumbing and a dilapidated appearance both inside and outside the property. The tenant eventually moved out, alleging that the owner’s actions adversely impacted its business to such an extent that it effectively forced it to abandon the property.

Facts: A luxury retailer (subtenant) subleased space for its flagship store. The sublandlord was an affiliate of the owner of the building. The sublandlord informed the subtenant that the property would be redeveloped in two years, and, in the meantime, the subtenant would have to pay substantially increased rent—one reflecting a higher fair market value revealed by a property appraisal. The subtenant objected. The sublandlord informed it that it was in default and its sublease would be terminated.

Facts: A bank tenant entered into two ground leases for properties on which to build a bank branch and parking lot, respectively. The tenant was responsible for procuring all necessary permits. The ground leases provided a contingency period—the “Approval Period”—of six months during which the tenant was required to seek all necessary government approvals and permits to construct and operate the branch. The leases also gave the tenant an option to extend the Approval Period for two three-month terms.