The Law

Inconvenient, Not Harrassment by Ron Davis Harassment charges leveled against the owners of a California shopping center by a tenant have not won the sympathy of the courts of that state. The shopping center, located in Torrance, leased space to the tenant since 1995. The center’s owner sold the facility in 2002, however, and the harassment charges resulted primarily from renovation and visual-improvement efforts of the new owners. The tenant operated a grocery store at the center and almost immediately found itself subjected to the new owners’ efforts to increase rents and common-area payments. But because of lease restrictions, those efforts failed. The owners then objected to the tenant’s operation of a recycling center in the center’s parking lot and to the tenant’s outdoor vending machines. The tenant duly removed the vending machines and relocated the recycling center to the rear of the store. The owners next objected to the tenant’s outdoor storage containers and “noxious odors” emanating from its rear trash bins. In reply, the tenant explained that the odors were mostly caused by water that had accumulated as a result of a defective pressure pump that the owners should repair. The tenant added that the odor was mostly caused by neighboring tenants that also used its trash bins. The showdown came when the owners began a remodeling of the center. The lease allowed such remodeling, but the tenant claimed that the remodeling came without notice and at a time of year (the Thanksgiving period) when the grocery business was at a peak. The owners complied with the tenant’s request to delay the remodeling, but the tenant decided to assign the lease to another business and soon after that sued the center’s owners. In that lawsuit, the tenant charged that the center’s owners had used the remodeling as part of a plan to force relinquishment of the lease by causing lost profits and depressing the value of the lease. A California court ruled, however, that the evidence failed to support the charges against the center’s owners. The tenant appealed. A California appellate court, in upholding the lower court ruling, explained, “[The remodeling] did not constitute a substantial interference with the tenant’s beneficial enjoyment of the premises.... The lease authorized the landlords to make improvements and to erect scaffolding and other structures in connection therewith. The construction lasted a mere three to four months, a period so short that the lower court could reasonably conclude the construction never rendered the premises unusable for their purpose or interfered with a material part of the lease.” (Hopemart, Inc. v. Meruelo, 2006 WL 3335228 [Cal.Appl. 2 Dist.])