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Up on the Rooftop...
by Ron Davis

Repayment for faulty roof repairs at a Louisiana shopping center will go to a tenant rather than the center’s owners, despite the owners’ having to pay to repeat the work.

The shopping center, located in Abbeville, had leased space to the tenant for the operation of a Chinese restaurant. One of the conditions of the agreement was that the tenant would repair a leaky roof and, in return, would rent the premises at a reduced rate.

The tenant hired a roofing contractor, paid him to make the necessary repairs, and began operations at the restaurant. But a year later, the roof began leaking again. And subsequent efforts to stop the leaks failed.

When his lease term ended, the tenant moved from the shopping center. He then sued the roofing contractor, and a Louisiana court ruled that the contractor must reimburse the tenant for the cost of the roofing work.

Meanwhile, however, the shopping center’s owners paid another roofing contractor to repair the roof. They then sued the tenant, seeking the payment he received in the settlement with the initial contractor. The owners explained that the tenant, in seeking reimbursement of the money paid for the roofing work, had not complied with their agreement to repair the roof and thus had admitted to a breach of the lease.

A Louisiana court ruled that the tenant must turn over those funds to the shopping center. The judge noted in his decision that the lease did not compel the tenant to repair the roof, but once he undertook the work, he became obligated “to hold [the center’s owners] harmless from the effects of defective installation.”

The tenant appealed, contending that the roof repairs his contractor made allowed the restaurant to open and operate without interruption. Moreover, the tenant added, despite its defects, the roof repairs left the roof in much better condition than when he first leased the premises.

A Louisiana appellate court, in agreeing with the tenant, pointed out that the roof was repaired to a “far better condition” than it was prior to the tenant’s occupancy of the premises and that, although certain leaks reappeared, “a satisfactory roof condition was achieved for the purpose of running a restaurant.”

Added the judges, “We reject the argument that, by virtue of the lawsuit to pursue the full enforcement of the contract with the roofing contractor, the tenant was admitting to a breach of the lease agreement–that is, the failure to obtain a satisfactory repair of the roof.” (Hai Nam Chinese Restaurant v. B&B Construction of New Iberia, 2006 WL 3093355 [La.App. 3 Cir.])

Decision: November 2006
Published: November 2006



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