The Law

Hurricane Katrina Fall-Out by Ron Davis An eight-year struggle to gain restitution may be over for a Louisiana shopping center tenant who suffered extensive damages inflicted by Hurricane Katrina. The shopping center is Colonnadas Plaza, located in Slidell. And the widespread damage caused by the hurricane also resulted in the gutting of the facility. Prior to the hurricane, however, the tenant had operated a tanning salon at the center. Those premises consisted of a glass store front, two side walls, a back wall, and a functioning bathroom. After leasing the space, the tenant constructed, at his own expense, a tanning-salon “build out” within the premises. That addition included twelve small tanning rooms, most of which had tanning beds. After the hurricane and the gutting of Colonnadas Plaza, the tenant notified its owner, seeking to exercise his option under the lease to have him reconstruct the leased premises. The owner began but did not the complete the reconstruction. A short time later, the owner decided to evict the tenant, and a district court granted that action. The tenant wasted no time in appealing his eviction. He countersued, charging breach of contract and wrongful eviction. In so doing, he pointed out that in renovating the premises after committing to lease the space, he spent approximately $72,000 to add tanning beds and other equipment. The tenant added that after the gutting of the shopping center, only minimal repairs were made to his unit. So the tenant briefly stopped paying rent, though later recommenced those payments to emphasize that he wanted to reopen his business. But the funds that the center’s owner received from insurance were apparently not sufficient to fully repair the shopping center. Moreover, he said after hiring a general contracting firm to renovate the center, he concluded that because of failure of the tenant to furnish information to complete the repairs, he assumed that the tenant did not intend to reopen his business. In response, the tenant claimed that he had previously sent a letter to the center’s owner, in which he requested that the owner repair the damage to the tanning salon. The owner, however, denied ever receiving such a letter. Instead, he added, he judged that the tenant did not want to reopen his tanning salon because that business was not profitable. A Louisiana judge decided in favor of the tenant and instructed the center’s owner to pay damages to the tenant in the amount of $100,250. That decision included payment of $20,000 for “mental anguish” that the tenant supposedly suffered. The center’s owner appealed that decision. A Court of Appeals of Louisiana upheld the lower court ruling, citing the tenant’s “emotional distress,” as well as “undue rental payments made by the tenant” and “rental payments and common area maintenance fees during the period when [the tenant’s] rental space was uninhabitable.” (Graci v. Gasper John Palazzo, Jr., L.L.C., 2013 WL 2350446 [La.App. 5 Cir.]) Decision: May 2013 Published: June 2013