Lawson & Weitzen attorneys J. Mark Dickison and Brendan Slean recently scored a significant victory on behalf of its client a commercial tenant in West Bridgewater, MA following a seven-day bench trial in Plymouth Superior Court before Judge William White. The Court awarded the tenant single damages in the amount of $844,373.84 which was doubled to the total amount of $1,688,747.68 under Chapter 93A after the its commercial landlord double-leased the parking lot to the tenant and the predecessor tenant (called the “co-tenant”), and then unfairly deprived the tenant from full access to its parking area. After interest, the total judgment for the tenant against the landlord was $2,156,295.59.
The facts of this case are instructive. The co-tenant entered into a commercial lease with the landlord’s predecessor which granted the co-tenant the exclusive right to park up to 250 passenger vehicles at a mixed-use commercial warehouse property with space for two tenants. Several years later, the tenant entered into negotiations with the landlord to rent the warehouse space abutting co-tenant’s property. The Master Lease to which the tenant was subject, entitled the tenant to certain parking rights, including 25 employee parking spaces and 10 truck parking spaces. During the negotiations, the landlord was aware of the tenant’s operations and that the tenant’s parking needs at the property vastly exceeded what was permitted in the Master Lease. Thus, the landlord and the tenant subsequently entered into a Consent Agreement which visually depicted the tenant’s parking area via a marked, colored aerial photograph of the parking lot that contained well over the 25 employee parking spaces and 10 truck parking spaces set out in the Master Lease. The Court concluded that the Consent Agreement modified the terms of the Master Lease.
After conflict arose between the existing co-tenant and the tenant over parking, the landlord failed to remedy the situation, and instead, engaged in unilateral conduct against the tenant including sending multiple notices of default, hiring security guards and erecting jersey barriers blocking access to the “marked, colored area” contained in the Consent Agreement. The landlord only agreed to remove the jersey barriers following court intervention at the commencement of this lawsuit.
Following a seven-day bench trial in October, the Court concluded that, “[The landlord’s] actions in double-leasing the Property to multiple tenants, over-promising the amount of parking available to both, constitutes a material breach of the Master Lease, as amended by the Consent.” [The landlord’s] actions required the tenant to drastically change its operations at the property, including maneuvering tractors trailers that were already on-site , and to change its business operations to comply with the landlord’s action. As a result, the Court concluded that the tenant established actual damages for associated costs due to the landlord’s conduct.
The Court also concluded that the landlord violated Chapter 93A when, even after the tenant complied with the landlord’s various Notices of Default and other demands, the landlord unilaterally installed jersey barriers in the area the landlord had expressly promised the tenant it could park its trailers for its operations. The Court determined that the landlord’s conduct rose to the level of a Chapter 93A violation because it knowingly breached the terms of the Consent Agreement, and unfairly and impermissibly restricted the tenant’s access to and use of an area of the property to which it was entitled. The Court went further and held that the purpose of the landlord’s actions “was to intimidate [the tenant] into compliance with [the landlord’s] demands [which] were counter to the bargained-for parking to which [the tenant] was entitled.” In doing so, the Court concluded that the landlord violated Chapter 93A and awarded the tenant double damages plus its attorneys’ fees. The Court also voided the tenant’s future obligations under the Lease.
This case is instructive for commercial landlords and tenants alike and is a reminder that both parties need to act in a commercially reasonable manner. Failing to act with commercial reasonableness, and making unilateral decisions in a selfish manner risks liability under Chapter 93A, § 11.
Lawson & Weitzen attorneys regularly represent commercial landlords and tenants in civil litigation matters. If we can assist you or your company, please do not hesitate to contact J. Mark Dickison or Brendan Slean or other attorneys on our team.
