Fitness Center Didn't Comply with Rent Clause

A lease required a tenant to use a space as an athletic club. The rent clause required the tenant to provide the owner monetary rent and “four full memberships to the athletic club to be operated by Tenant within the Premises.” The term “athletic club” referred to a full-service facility open to both sexes.

The tenant closed the facility for a month, auctioned off its equipment, and reopened as a greatly reduced capacity “women's facility.” The tenant stopped providing the four full memberships to the owner. The owner then tried to evict the tenant for violating the lease. The tenant argued that the membership requirement didn't apply, because the tenant was no longer a full-service facility.

A Wisconsin appeals court ruled that the owner could evict the tenant. The court noted that the parties were not dealing with a mere use clause situation but with a rent clause that expressly required the tenant to provide the owner with four full memberships to an athletic club in the space. Thus, compliance with the rent clause required an ongoing athletic club, said the court.

However, the tenant didn't provide a full-service facility open to both sexes. Instead, the tenant supplied a greatly reduced capacity facility open only to women. And giving memberships to a female-only facility at the space would not satisfy the lease's rent clause, noted the court.

• 44 Associates L.P. v. Capital Fitness, L.L.C.: No. 2005AP3091, 2007 Wisc. App. LEXIS 214 (Wis. Ct. App. 3/8/07).