It’s The Occupancy Cost, Not Just The Rent, Stupid

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 Sitting, as we are, in the northeast, with what seems to be a steady barrage of snow and ice storms, our thoughts naturally turn to “occupancy costs.” Before readers call for the white coated bearers of big nets to take us in, let us explain. But, first we’re going to Ruminate a little more.

At one time, the prices quoted by hotels and airlines could be held next to one another to find a good deal. No longer. Now, even they have “unbundled.” That would be fine if it were easy to “build and then price” your own travel package. But, it isn’t. [Want a pillow, a movie, and a hummus platter?]

Shop for a rental car today. Look at the web price and then get to the counter: “return the tank full; pay $9.00 a gallon; buy a tank from us at $3.35 a gallon; add a driver; return an hour late; and, it goes on an on.” When you go to ebay.com to buy something, be sure to sort by “price plus shipping.” [Read more...]

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Eight More Issues Raised By An Agreement’s Attorneys Fee Provision

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Attorneys fee clauses – where did we leave off last week? Well, we had a list of issues and only explored the first two. Here’s the list. If you want to see what we’ve written thus far, click HERE.

To make this page “look good” and match the look of prior blog postings, we’ve got to do some “fill-in” text. So, this is a good opportunity to thank our large audience of readers, many of them fervent followers of Ruminations. With today’s posting (our 151st to date), we’ve broken through the “150″ barrier. All of our prior posting are available and our crude search feature might get you to explore some topics you never thought could be topics. So, here’s a big THANK YOU, and  the end of our segue to the list of issues we promised in the paragraph directly above. Keep your comments and your ideas for future postings coming this way.

And now, here’s that list: [Read more...]

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Attorneys Fees Provisions Are Way More Complicated Than You Think – Here Are Some Reasons Why

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Attributed to George Bernard Shaw is this (perhaps variant) observation: “The English and the Americans are two peoples divided by a common language.” So, there should be no surprise to experienced readers that, when it comes to the right to collect attorneys fees, there is the “English Rule” and there is the “American Rule.”

Those two rules simply reflect different philosophies or “public policies.” Under the English Rule, losers pay the winner’s attorneys fee under the policy that, if your claim could not be sustained, the party you claimed against should be returned to where it stood before the suit was filed. The American Rule, fully cognizant of the “fairness” goal of the rule from across the ocean, says that, absent fraud on the party of the one charged or a [Read more...]

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“At present I would prefer not to be a little reasonable” – Asking For The Unreasonable Vs. Acting Unreasonably

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We’ve written, with favor, about the use of words such as “reasonable” in agreements of all sorts. Just like the use of the modifier, “material,” the modifier “reasonable” works pretty well in practice. If you are curious about what we’ve written about “material,” click HERE. Today, we’re going to Ruminate about being “reasonable” in another context – negotiations.

First, two anecdotes, the first being about a large retailer, one with over 30,000,000 square feet of leased space, whose general counsel explained the company’s negotiation policy as follows: “It is our corporate policy to be unreasonable.” The second, perhaps not technically an anecdote, is a literary quote from Melville’s character, Bartelby, the scrivener: “At present I would prefer not to be a little reasonable.” [Read more...]

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So, What Does It Take To Make A Lease Financeable? You Asked; We Answer.

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A couple of weeks ago, we Ruminated about leasehold mortgages and why landlords shouldn’t get bent out of shape when a tenant who qualifies for one wants to be able to encumber the tenant’s (not the landlord’s) interest in the lease. We won’t repeat much of that, if you hadn’t seen that blog posting or if it was immediately forgettable, you can visit or revisit it by clicking HERE.

Basically, our take on a leasehold mortgage and how it affects the leasing arrangement between a landlord and its tenant is as follows: [Read more...]

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Save Time And Money And Screw Up A Lease’s Co-Tenancy Provision

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We don’t know where to start, but we’ll press ahead anyway. Last week, a November, 2013 federal court decision involving a co-tenancy provision in a shopping center lease was brought to our attention. It is captioned: Kleben Holding Company, LLC v. Ann Taylor Retail, Inc. and can be seen by clicking HERE.

At the outset, readers should note that the court’s decision was in the form of a “summary judgment.” For readers who don’t know, this means the court believed there were no disputed facts. In this case, there was no trial. The parties conducted their own investigations and the court thought, based on what was presented to it, that all the facts it needed for its decision were in front of the court and that there was no legitimate dispute about them. Although this procedural device is available throughout our court system, it isn’t often applied, especially by state courts. Federal courts, as is the case with this decision, are more willing to dispose of matters by summary judgment. Whatever be the situation with this dispute, on the face of it, the facts were pretty well set. [Read more...]

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Landlords Rejoice – Your Tenant Is Borrowing Money

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Everyone accepts that property owners borrow money for their businesses. Very few properties are unencumbered by a mortgage. Other than in a very, very limited number of situations, tenants readily, perhaps automatically, accept that their lease will be subordinate to at least the lien of a mortgage. If a tenant can be insulated from the bad effects of a lender taking over a property or from the fallout of a foreclosure, it will or should be somewhat indifferent to having a lender or a new owner step in when its then-landlord can’t financially support the property any longer. Yes, it is messy, but think [Read more...]

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How To Waste Everyone’s Time And Money By Pretending That You Know What You Are Doing (As The Basis For A New Year’s Resolution)

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It’s a shame that we’re all in holiday mode because some readers may have missed last week’s posting. If you are one of those readers, click HERE to see what it was all about. And, don’t miss the comments, especially the one from the owner of the business whose entry into the retail market was at the root of our posting. It reinforces the message that you may have the right to do something, but it doesn’t mean you also have the power to do it. [Read more...]

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