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What Happened: Technically, the landlord had a perfectly valid case to evict. But there was also a clear explanation why Bed Bath & Beyond (BB&B) didn’t pay its late rent until after the 10-day cure notice period expired. Its corporate headquarters was closed due to COVID-19 on the day the landlord’s notice to cure arrived. As a result, the notice was redirected to the BB&B warehouse where it came into the hands of an employee who had no authority to do anything about it.
What Happened: From March to October, a steakhouse couldn’t come up with its monthly rent because of the COVID-19 public health orders restricting indoor dining, the meat and potatoes of its business. But the steakhouse tried its best to be a faithful tenant. First, it asked for a rent abatement of at least 50 percent. The landlord ignored and later rejected the request. And when business improved in November, the steakhouse sent the landlord a check covering not only November but also the previous eight months plus interest and late fees.
What Happened: A lease between a shopping center and hair salon banned the landlord from renting to a competing business. The landlord then acquired an adjacent, nearly identical building sharing the same parking lot located only 50 yards away and leased part of it to another hair salon for 10 years. When the original salon tenant found out, it sued the landlord for fraud and breach of contract. The trial court nixed the fraud claim but found the landlord liable for violating the noncompete. The landlord appealed.
What Happened: New York City has a law that bans commercial landlords from engaging in “harassment” to force tenants to vacate or waive lease rights via illegal threat of force or threats based on race, creed, color, age, etc. At the height of the first wave of the pandemic, the city temporarily expanded the harassment ban to cover threats related to rent against tenants impacted by COVID-19. The law also imposes a one-year ban on enforcement of personal guaranties for defaults resulting from COVID-19 closures.
What Happened: A landlord who had just bought the property and was eager to lease it for a higher rent approached the current gas station tenant about a potential buyout. The negotiations proved unsuccessful. Less than three months later, the landlord tried to evict the tenant for unpaid rent and damaging the property, but the court dismissed the case.
What Happened: Who won the legal showdown between the Florida mall and the retail tenant that cited the force majeure clause of its lease as an excuse not to pay rent in May due to business losses resulting from government COVID-19 shutdown orders? At stake was more than pride. Under terms of the lease, whoever was the winner, or “prevailing party,” would be entitled to tens of thousands of dollars in attorneys’ fees and legal costs.
Ruling: The Florida federal court found that neither side was the prevailing party.
What Happened: A pharmaceutical company used the warehouse it sublet to store its drug products. But the warehouse sprinkler system went haywire and inflicted $265,110 in damage to the products. The company sued the landlord and tenant. Naturally, each side blamed the other and filed cross claims—that is, claims pitting one defendant in a lawsuit against the other.
Ruling: The Delaware court refused to grant summary judgment to either side and ordered a trial instead.
What Happened: Bed Bath & Beyond (BB&B) didn’t provide the necessary sales records to verify its percentage rent payments, concluded the landlord’s auditor in the spring of 2017. The landlord didn’t talk to BB&B or otherwise follow up on the audit. Move ahead three years when, after not paying April and May rent due to the pandemic, BB&B offered full payment in June.
What Happened: It was a long running dispute: The landlord thought the tenant owed Terminal Usage Fees; the tenant disagreed. In a civil society, there are courts to resolve these types of disputes. But instead of filing a lawsuit, the landlord took matters into its own hands by blocking the access roads used by customers to get to the tenants’ liquid petroleum tanks. Rather than give in to extortion, the tenant went to court seeking a preliminary injunction barring the landlord from blocking the access roads.
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