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Q: Is a tenant liable for breach of contract for “going dark?”
A: Yes, in some circumstances. A tenant will be liable to the landlord for “going dark” if the lease expressly or impliedly includes a covenant of continuous operation. Assuming there is no such express provision in the lease, the court must determine, based on the entirety of the facts and circumstances surrounding the lease, whether the parties intended it to include an implied covenant of continuous operation. Possibly the most important factor is whether the rental to be paid is based solely on a percentage of the sales or profits generated by the business. If the court finds that there was no such intent, the tenant’s “going dark” will not be deemed a breach of the lease, provided it continues to timely pay rent.
Source: Lincoln Tower Corp. v. Richter’s Jewelry Co., 12 So. 2d 452 (Fla. 1943); Mayfair Operating Corp. v. Bessemer Properties, Inc., 150 Fla. 132, 136 (Fla. 1942); Diltz v. J & M Corp., 381 So. 2d 272 (Fla. 3d DCA 1980); Stemmler v. Moon Jewelry Company, Inc., 139 So. 2d 150 (Fla. 1st DCA 1962); Jerrico, Inc. v. Wash. Nat’l Ins. Co., 400 So. 2d 1316, 1318 (Fla. 5th DCA 1981).
Q: What is a covenant of continuous operation?
A: A covenant of continuous operation is an obligation on the part of the tenant to continue to operate the business at the leased premises. This obligation is especially important where the rent is tied in some way to the tenant’s business, such as being based on tenant’s gross sales or profits. This covenant is also important in the context of anchor tenants that generate substantial traffic to the premises, thereby increasing the sales of the other tenants. A covenant of continuous operation is breached when the tenant discontinues operations (“goes dark”) at the leased premises, even though it continues to pay rent.
Source: 15 Williston on Contracts § 48:4 (4th ed.)
Q: Describe the landlord’s duty to deliver possession of the premises.
A: The landlord has an implied duty to give possession to the tenant at the time stated in the lease contract. In other words, the landlord is bound to permit the tenant to take possession at the commencement of the term and to interpose no obstacle thereto. Delivery of a lease authorizes the tenant to take possession according to the terms of the instrument. During the term of the lease, the tenant in possession is for all practical purposes the owner of the property, having the right of possession, dominion, control, and use thereof, in the absence of a statute affecting or limiting such rights. Where the lessor fails to give possession, the lessee may maintain an appropriate action against the lessor, such as an action for damages or an action for possession. In the context of new construction, an implied warranty or covenant arises that the completed structure will be suitable for the lessee’s intended use.
Source: 52A C.J.S. Landlord & Tenant §§ 724, 731 (2012); Levitz Furniture Co. of E. Region v. Cont’l Equities, 411 So. 2d 221, 223 (Fla. 3d DCA 1982).
Q: What is the landlord’s covenant of quiet enjoyment?
A: A covenant of quiet enjoyment made by the landlord assures the tenant that the landlord’s title is not defective and that the tenant’s possession will not be disturbed. It protects the tenants against the acts or hindrances of the landlord. As the name suggests, it assures that the tenant shall have legal quiet and peaceable possession and enjoyment of the leased premises. The landlord’s duty to provide quiet enjoyment also applies to a subtenant. A covenant of quiet enjoyment is implied in the lease, whether written or oral. However, the parties may expressly exclude the implication of a covenant for quiet enjoyment.
Source: 52A C.J.S. Landlord & Tenant § 768 (2012); Blum v. Kohlmeyer & Co., 363 So. 2d 1129 (Fla. 3d DCA 1978).
Q: What happens if the landlord breaches the covenant of quiet enjoyment?
A: A tenant may bring an action for breach of the covenant of quiet enjoyment against the landlord for interference with the use and enjoyment of the rented property. A breach of the covenant of quiet enjoyment may entitle the tenant to be discharged from his obligations under the lease; the tenant no longer has to pay rent. An express covenant of quiet enjoyment may provide that the landlord shall pay damages to the tenant if the beneficial enjoyment of the premises is interrupted by a failure in the landlord’s title.
Source: 52A C.J.S. Landlord & Tenant §§ 777 (2012).
Q: Is a landlord liable for injuries occurring on the leased premises?
A: Generally, a landlord is not liable for injuries occurring on the leased premises. However, a landlord may be liable for injuries if the condition causing the injury is:
- a violation of law;
- a pre-existing defect;
- an inherent danger; or
- the landlord undertakes a covenant to repair.
When there has been a violation of law by the landlord, not even an exculpatory clause will insulate the landlord from liability. See John’s Pass Seafood Co. v. Weber, 369 So. 2d 616 (Fla. 2d DCA 1969) (finding that landlord is not permitted to exculpate himself from liability to a tenant for fire damage which occurred as a result of the landlord’s failure to provide firefighting equipment on leased dock).
A pre-existing defect in a structure or premises will generally lead to a landlord’s liability for injuries to strangers that are caused by that defect. The landlord has a duty to warn any guests of a tenant against known dangers the licensee is not likely to discover and to refrain from wanton negligence or willful misconduct. However, when a tenant is in complete control of the premises and a defect comes into existence during the term of the lease, or a dangerous condition is the direct result of the tenant’s use of the premises, a landlord will not normally be liable for injuries to an invitee of the tenant. See Lich v. N.C.J. Inv. Co.,728 So. 2d 1191 (Fla. 2d DCA 1999) (landlord was not found liable when a window that broke and injured tenant’s employee had operated properly for one year and was installed prior to landlord’s purchase of the building.)
A landlord who assumes a duty to repair or to improve the rented premises is held to a standard of reasonable care in making the repairs or improvements. A landlord will be liable for injuries caused by the negligence of his own unskillful work or the work of his servants or employees in making the repairs or in leaving the premises in an unsafe condition, even if the repairs are undertaken voluntarily.
Q: Does a landlord have a duty to protect against foreseeable criminal activity?
A: Yes, landlords may have a duty to protect against foreseeable criminal activity. This duty may be limited to harm occurring on premises under the direct control of the landlord. For instance, this duty extends to common areas within the landlord’s control.
Source: McVicker v. Kolb, 839 So. 2d 768, 769 (Fla. 4thDCA 2003)
Q: Can a commercial landlord protect itself from liability for its own negligence?
A: Yes. A commercial landlord may avoid liability for its own negligence by inserting a specific exculpatory clause, with clear terms, in the lease contract. Exculpatory clauses that limit or exempt liability for negligence are disfavored, but are enforceable in Florida courts.
Source: University Plaza Shopping Center, Inc. v. Stewart, 272 So. 2d 507, 511 (Fla. 1973)
Q: In general, what are the duties and obligations of the tenant?
A: The tenant’s primary duty is the payment of rent. The tenant also has the duty to surrender the premises at the termination of the lease agreement. Additionally, the tenant has a duty not to commit waste. When the lease term begins, the tenant has the right to occupy and to use the premises described in the lease. However, in the absence of a specific provision or in the absence of waste, the tenant has no obligation to occupy or use, or to continue to use the demised premises for a particular purpose, even if both parties expected and intended a particular purpose.