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Day Late Payment
by Ron Davis
The future looks bleak for a certain shopping center lessee in Louisiana. That’s because the shopping center, New River, reportedly fell behind in paying the rental fee that the center’s owners charge.
According to New River, however, it timely issued a check in the amount of $27,212. That’s despite “no contractual obligation for New River to do so and not withstanding failure to honor the agreement” with the center owners.
The center’s owners rejected the offering. They claimed that they received the money one day late. They then explained that “due to the fact that the re-issued check arrived one day after the deadline, defendant’s representative returned the check to New River the day after received.”
In response, New River asked the courts to prevent being evicted from the premises. That’s because, New River explained, it had not breached any obligations in the ground lease. The situation at that point became a matter of whether the center’s owners may properly evict New River, based on Louisiana law. New River asked the courts and any person acting on their behalf to prevent taking steps to raise the rent owed under New River’s lease with the defendant terminating the lease and/or ejecting New River from the premises.
In support of the argument, the owners felt assured that they would be successful on the merits of the case. And New River relied solely on the merits of a previous legal case. It states that “if a landlord accepts rental tender from his or her tenant after notice to vacate is issued by his tenant and after the landlord accepts a rent check and despite giving the tenant a notice to vacate the premises and for a period beyond the time the notice indicates, the lease arrangement would be terminated.”
The court stated “This court indicates that the defendant provided New River a notice on April 2017. Absent in the record is any evidence that the defendants have accepted a rental check from New River posted April 27,2017, thereby vitiating defendant’s vacate.
“As in most states, landlord-rental law makes it clear that dissolution of the lease for nonpayment of rent is subject to judicial control (according to the circumstances). A Louisiana court of appeals stated that judicial control is an equitable doctrine by which the courts will deny cancellation of the lease when the lessee’s breach is of minor importance, is caused by no fault of his own, or is based on a good faith mistake of fact.”
The judge stated that “New River has not established that defendant made a custom of accepting last payments. Accordingly, New River has not established its prima case under Louisiana law, and the court cannot find that it would be substantially likely that New River would succeed on the merits.
(New River Shopping Center LLC v Vivian G. Villenurve and Margaret C. Kernan, Civil Action 17-280-SDD-RLB)
Decision: April 2017
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