Lease Audit Information
TOPIC OF THE WEEK:
Best Buy Stores, LP v. Developers Diversified Realty Corp., 715
F. Supp. 2d 871 (D. Minn. 2011):
In this case, the court
determined that the Landlord breached the lease
agreements by charging Best Buy for a "first dollar program" and
"captive coverage" forms of self-insurance. Based on the
respective lease language in several leases, the Court found
that the Landlord was permitted to charge for "costs of the
insurance" or "costs of premiums" for the insurance, but these
terms did not include other "costs" charged by the Landlord,
such as deductibles or self-insurance costs. Also, the court
held that the tenant could go forward with a fraud claim against
the Landlord based on documents that misrepresented a
self-insurance program as "insurance" and captive insurance as
"deductibles". Click here for case.
See
also: Insurance.
In
addition, this court rejected a common Landlord argument that
even if the service is not specifically discussed in the lease
agreement, the tenant should be responsible if the service
provides some value to the tenant.
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