What if it isn’t a Rogue Tenant Violating an Exclusive Use Right?

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I thought we’d take a break away from the vigorous debate about whether lease renewal (and other) options should be conditioned on the absence of a default, and return to the more mundane discussion about exclusive use right issues.

A number of contributors thought that our industry should have a different name instead of “Rogue Tenant” for a tenant who violates the prohibition, in its own lease, against conducting a use that was granted to another tenant as that other tenant’s exclusive use at the project. You can see those comments at our August 11 Ruminations entry.

What do you call a tenant that is violating another’s exclusive use right, but that isn’t a “rogue tenant”? Absent any knowledge on its part that the other tenant has bargained for an exclusive use right, you probably can say: an “Innocent Violator.” [Read more…]

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Estoppel Letters Can Matter – But, is the Office Depot Decision Really an Exclusive Use Case?

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So, on May 6, 2011, the Court of Appeals of Georgia, an intermediate appellate body, upheld a lower court’s decision that stopped Office Depot from pursuing a breach of an exclusion use right it thought it had.

I’ve seen some discussion about the Opinion (Office Depot Inc. v. The District at Howell Mill LLC, A11A0383) and how it should scare parties who sign estoppel letters or certificates. Why the decision should come as a surprise puzzles me. Shouldn’t people bear the consequences of their own acts? When someone says: “is this true or not, I’m going to change my position in reliance on what you tell me,” shouldn’t there be some consequences if the respondent says “true” or “not true,” when the opposite was the case?

Sure, there are weasel words and attorneys do and should look for ways to get their clients out of such consequences, but the starting point is for respondents to take the “questions” seriously. [Read more…]

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