Lease Audit Information

TOPIC OF THE WEEK:

Enterprise-Laredo Associates v. Hachar's Inc. (839 S.W.2d 822; 1992 Tex. App. Lexis 2317):

In this decision, the Fourth District Court of Appeals in Texas ruled that the 4-year statute of limitation period on a breach of contract claim did not begin to run at the time of the final common area maintenance charge accounting for each respective year.

The "discovery rule" (which is not applicable in every state) tolls the running of the limitations period until such time as the injured party discovers or, through the use of reasonable care and diligence, should have discovered injury.

This is an important case because one could argue that a billing error that occurred 10 years ago, but discovered only recently, may not be subject to the applicable statute.

This court also found that a letter agreement signed by Hachar wherein Hachar agreed to "waive any other violations of the Lease by Landlord that may have occurred prior to March 31, 1987" did not stop Hachar from submitting claims for CAM overcharges, because Hachar was not aware of the CAM overcharges at the time he signed the "waiver". (It is important to note that the difference between a "waiver" and a "release" is significant.)