Recent Court Rulings

Bankrupt Tenant Needn’t File Formal Court Motion to Assume Lease

November 25, 2024    

What Happened: A Rite Aid tenant in Redwood, Calif., notified the landlord of its desire to extend the lease for another five years. But the parent company filed for bankruptcy shortly thereafter. Under Section 365(d)(4) of the bankruptcy laws, a debtor in possession of...

Court Pierces Corporate Veil to Hold Owner Liable for LLC’s Rent

November 25, 2024    

What Happened: A landlord leased office space to a limited liability company (LLC A) provider of flexible workspace. An LLC (LLC B) that acquired the tenant a year later approached the landlord about assigning the lease to one of its other subsidiaries, another LLC (LLC C) with...

Out-of-Possession Landlord Not Liable for Injury to Tenant’s Worker

November 25, 2024    

What Happened: A piece of lumber debris flew off a table saw and struck a nearby worker who was operating a machine called an edge bander. The victim sued the landlord/owner of the woodworking plant where the incident occurred for negligence and under a state labor law designed...

Landlords Can't Challenge Constitutionality of Unenforced COVID Guaranty Nullification Law

October 30, 2024    

What Happened: At the height of the pandemic, New York City adopted a law permanently voiding personal liability guarantees of commercial lease obligations arising between March 7, 2020, and June 30, 2021, and banning landlords from taking legal action to enforce those...

Landlord Must Stand Trial for Negligence to Customers that Tenant Sexually Assaulted

October 30, 2024    

What Happened: A Utah shopping center leased property for use as a massage therapy center, even though the tenant didn’t have a license to provide those services in the state. Four years later, three customers claimed that the tenant sexually assaulted them during their...

Landlord Can't Prove that Mall Tenant Failed to Maintain Food Court

October 30, 2024    

What Happened: A shopping center landlord sued to evict the tenant in charge of operating the mall’s food court for multiple lease violations, including failure to maintain the premises in a clean and orderly manner. After a three-day trial, the court concluded that the...

No Medical Evidence Linking Negligent HVAC Maintenance to Tenant’s Rashes

September 26, 2024    

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...

Post-Expiration Tenancy Is Month-to-Month, Not a Holdover

September 26, 2024    

What Happened: A medical tenant remained in possession and paid the landlord normal rent after its one-year lease term expired. The landlord accepted the rent payments and didn’t demand that the tenant leave. Six months later, the property suffered flood damage. The tenant...

Indemnification Clause Doesn’t Indemnify Landlord Against Its Own Negligence

September 26, 2024    

What Happened: A pedestrian sues the store owner and landlord for negligence after tripping over allegedly defective cellar doors located on the sidewalk in front of the premises. The landlord asks to be let out of the suit under state laws relieving out-of-possession landlords...

Does Street Closure Violate Restaurant Tenant's Right to Quiet Enjoyment?

August 27, 2024    

What Happened: A high-end restaurant operator leased property on Holyoke Street in Harvard Square knowing that the university/landlord was planning to undertake a major, four-year construction project spanning an entire city block across the street. The blasting work began two...

Compounded Late Fee Is an Unenforceable Penalty

August 27, 2024    

What Happened: A landlord took a cosmetology school tenant and its guarantors to court for failing to pay rent in 2020 while government COVID-19 shutdown orders were in effect. The defendants raised the usual affirmative defenses including force majeure and frustration of...

Tenant Still in Possession After Lease Expires Must Obey Terms of Original Lease

August 27, 2024    

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;...