SW Legal studies in Business

Original Tenant Liable for All Terms of Lease Despite Breach by Subtenant
Description

Appeals court held that a trial court was in error when it failed to award attorney fees to a landlord, the prevailing party in a suit against a subtenant. The lease stated that the lessor had the right to sublet the property and that in the event of litigation the prevailing party would receive attorney fees.

Topic Real and Personal Property
Key Words

Vacant Property; Seizure; Nonprofit

C A S E   S U M M A R Y
Facts

Good leased commercial property to Saia in 1976. Saia assigned the lease to Windjammer in 1978. Windjammer later assigned the lease to Roth. Roth later exercised a renewal option to keep the property. The lease stated that the lessee could, without the consent of the lessor (Good), assign the lease. It then states: “In such event, Lessee shall remain liable for the payment of all rent required to be paid hereunder and for the performance of all terms, covenants and conditions herein undertaken by Lessee.” The lease also held that in the event of legal action, the prevailing party was entitled to recover attorney fees and costs. Roth breached the lease. Good then sued Saia, the original lessee, and Roth for breach and won the case. Good then requested the court award him attorney fees of $20,025 plus costs of $471.50. The trial court refused. Good appealed that decision.

Decision

Reversed and remanded. The original tenant on the lease was liable to the landlord for attorney fees and costs incurred in evicting the subtenants. The lease clearly stated that the lessee would remain liable for the performance of all terms of the lease, and one term required payment of attorney fees and costs to the prevailing party in the event of legal action to enforce the lease. The fact that the original lessee had not been in possession of the property for almost 30 years did not affect liability.

Citation

Good v. Saia, 9 So.3d 1070 (Ct. App., La., 2009)

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