Wednesday, December 4, 2013

Stop & Shop, Inc. v. Ganem case brief

Stop & Shop, Inc. v. Ganem case brief summary
200 N.E.2d 248 (1964)


CASE SYNOPSIS
Appellant landlords challenged the decision by the superior court (Massachusetts) in favor of appellee tenant ruling that the parties' lease did not expressly or impliedly require appellee to use the demised premises for any particular purpose, keep the premises open, or engage in the supermarket business on those premises. Appellants argued that the lease included an implied covenant to continue the supermarket operations.

CASE FACTS
Appellant landlords sought review of the trial court's decision in favor of appellee tenant determining that the parties' lease did not include an implied covenant requiring appellee to continue to operate a supermarket business on the demised premises.

HOLDING

  • The court held that the parties' lease, whereby appellee promised to pay a fixed annual rent together with a further rent of 1.25 percent of all gross sales above a set amount, did not impliedly incorporate a covenant that appellee would continue to operate a supermarket business on the leased premises. 
  • There was nothing in the record which implied a covenant to operate the supermarket business beyond that time when--based upon the business judgment of appellee--the business should cease. 
  • Appellants did not demonstrate that a reasonable person in their position could be justified in understanding that an implied covenant was intended by the parties to the lease. 
  • In addition, the court held that the terms of the lease did not prevent appellee from opening competing stores adjacent to or near the demised premises. 
  • Accordingly, the trial court's decision was affirmed.
CONCLUSION
The trial court's decision in favor of appellee tenant was affirmed. Appellant landlords did not produce evidence demonstrating that an implied covenant, requiring appellee to continue to operate a supermarket on the demised premises, was contained within the parties' lease agreement. In addition, nothing in the lease prevented appellee from beginning competing supermarkets adjacent to or near the leased premises.

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