Legal
What's New Research Government Site Index Home Meetings Directories About ICSC Search ICSC Sign On Publications Education Help Messages



ICSC Legal Database - CasesMonday, February 22, 1999 05:01 PM

Case Index:
00106

Citation:
202 Marketplace v. Evans Products Co., 642 F. Supp. 874 (E.D.Pa. 1986).

Issue:
Whether a landlord can terminate a lease due to the lessee's repeated failure to clear common areas of

erchandise and waste material, including failure to cure such violations within 30 days after formal notification as

 required in the lease.

Facts:
Evans Products Co. (lessee) rents a store and storage area in a shopping center owned by 202 Marketplace

(lessor). The lease demised a specific portion of the shopping center to lessee and delineated common area

(parking areas and sidewalks) for the joint use of all tenants, customers, invitees, and employees. The lease

also provided a mechanism, which included a 30-day notice requirement, by which the landlord could regain

possession of the premises if the tenant defaulted on any of its covenants. In May, 1982, lessor notified lessee

that it was improperly storing merchandise outside of its designated storage area; that it was improperly

maintaining the exterior of the premises and that it was advertising in ways prohibited by the lease. In August,

1982, lessor notified lessee, stating that lessee's actions were violations of its obligations under the lease.

Thereafter, lessor for a declaratory judgment, claiming that lessee's failure to remove its merchandise from the

common areas violated the lease, and that lessor was thereby authorized to terminate the lease.

Holding:
The Federal District Court held that tenant's repeated failure to clear common areas of merchandise justified

termination of the lease. The court stated that before a landlord may declare a forfeiture of a lease, it must

clearly establish that (1) it has a right to declare a forfeiture, (2) the event triggering the forfeiture is adequately

proven,

(3) the forfeiture was acted upon promptly, and (4) enforcing the forfeiture is not unconscionable. However, the

burden is on the party opposing forfeiture to show that fair dealing and good conscience requires the intervention

 of equity to relieve it from the strict enforcement of the terms of the lease. The court determined that the

evidence was clear that the tenant obstructed the common areas and that it had not cured the default within

30-days following the notice of August, 1982. As such, the landlord was authorized by the lease to terminate

the agreement. In addition, the tenant was a major corporation with approximately 350 retail stores and had not

established that it would be unconscionable to enforce the agreement. Finally, because there was no evidence

of trickery or bad faith on landlord's part, the termination is valid.

Publication:
Legal Update

Date:
Winter 1986

Classification 1:
Landlord and Tenant

Classification 2:
Common Areas

Classification 3:

00106 - Legal Update - Winter 1986