Officer of Corporate Tenant Can't Sue Owner

January 1, 2003

A corporate tenant complained to the owner about a leak, so the owner sent a maintenance worker to fix the leak. But two days later, all the tenants on the first floor—including the corporate tenant—had water in their spaces. The corporate tenant never resumed business in the space and eventually moved out. The tenant's corporation was dissolved and an officer of the former corporation formed a new corporation and resumed business in her home.

A corporate tenant complained to the owner about a leak, so the owner sent a maintenance worker to fix the leak. But two days later, all the tenants on the first floor—including the corporate tenant—had water in their spaces. The corporate tenant never resumed business in the space and eventually moved out. The tenant's corporation was dissolved and an officer of the former corporation formed a new corporation and resumed business in her home. The officer then sued the owner, claiming that, because of the owner's negligence in addressing the leak, she suffered economic losses, including relocation expenses related to the renovation of her basement for the new business.

A Connecticut court dismissed the lawsuit ruling that the officer of the corporate tenant can't sue the owner. The court explained that the officer's lawsuit was based upon the owner's alleged breach of its duties under its lease with the corporate tenant. So only the corporate tenant could sue the owner—but the corporate tenant had already been reimbursed by its insurer for the property damage and business interruption caused by the water, the court noted. And the expenses the officer was suing to recover were incurred after the corporate tenant had been dissolved [Hartford Fire Ins. Co. v. Leninski].

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