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by Ron Davis
A serious mix-up has cost the owners of an Alabama shopping center more than $70,000 that a tenant was required to pay them for a breach of lease.
The shopping center, located in Montgomery, had leased space to the tenant under a long-term agreement. And the breach occurred when the tenant was unable to comply with the rental requirements of the lease. In the ensuing lawsuit, a judge eventually ordered the tenant to pay $73,180.24 in damages to the shopping center owners.
The tenant appealed that award, arguing that the lawsuit was faulty. He pointed out that the entity suing him did not have legal standing to do so.
In fact, the tenant had actually leased space at the shopping center from two individuals, who signed the agreement as the "landlord." One of the individuals then witnessed, on behalf of "O&P Properties," a "tenant acceptance letter" signed by the tenant.
But the entity suing the tenant was named L.C. Properties, L.L.C. And although the individuals who owned the shopping center also had an ownership interest in L.C. Properties, L.C. Properties was obviously not the landlord of the shopping center named in the lease.
An Alabama appellate court reversed the award for the breach of lease, explaining, "The court heard no evidence indicating that L.C. Properties had an interest in the lease with the tenant. The principal never attempted to substitute himself or O&P Properties as parties to the lawsuit. Moreover, any substitution would not relate back to the filing of the complaint by L.C. Properties because there is nothing back to which to relate. We conclude that, based on the evidence in the record, L.C. Properties did not have standing to sue the tenant for breach of lease." (McCurdy v. L.C. Properties, L.L.C., 781 So.2d 991 [Ala.Civ.App. 2000])
Decision: November 2000
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