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Strip mall lease disputes are a source of business litigation

Businesses located in shopping centers and strip malls usually have to sign a lease with the development owner or management company. Prior to the expiration of the lease, the business must decide if it wants to renew or to give notice of moving out. This kind of business relationship is common in Florida and all other states, and it sometimes results in bitter disputes and business litigation.

Generally, in such litigation one or both sides will claim a breach of the lease agreement. The tenant may typically claim that the owner has not kept the building and surrounding premises in good repair. Generally, the landlord has the duty to maintain the major physical systems, along with seeing to it that the grounds are maintained, including ice and snow removal.

For various reasons, the tenant business may fall behind in its payments, which allows the landlord to call a default. The landlord may try to evict along with making a claim for the back rent. These are but a few of the main ways in which breach of contract claims may arise between the parties.

In a recent lease dispute in another state, a restaurant owner has given notice to the owner of the shopping center that it has closed its doors and wants out of the remaining three years of their five-year lease. The North Carolina business has been in the same location for 18 years. The owner wants to hold the tenant to the remaining three years.

The business tenant says that the owner did not comply with its duties to repair and maintain the property. The tenant points to some specific examples of repairs not done. The owner claims that it has done everything required to repair and maintain.

In Florida and elsewhere, if the owner files business litigation and the tenant does not defend, a judgment may be entered, which could come back later to haunt the tenant. Negotiations may be the best option at the outset — this may lead to a settlement based on a significantly reduced amount. The owner has a legal duty to mitigate damages by obtaining a new tenant as soon as reasonably possible, which makes it unlikely that the full term of the lease can be collected.

Source: c-ville.com, “Seafood shop closes, lease dispute flares at Meadowbrook Shopping CentreC-Ville Weekly“, Courteney Stuart, May 30, 2014

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