In Rubloff CB Machesney Park LLC v. World Novelties Inc. d/b/a Pantera Coffee and Crumbs, the landlord (Rubloff) sought to terminate the lease of a tenant (Pantera) for numerous violations of the lease. The tenant leased a retail space in the Machesney Park Mall. The lease required the tenant to pay rent on or before the first day of the month, to operate its business in a dignified manner consistent with the general high standard of the business in the mall, and not in a disreputable manner.
The tenant’s operation of his shop appears to have been a mall operator’s worst nightmare: the tenant’s owner made sexually suggestive comments to a young female shopper, allegedly locked a screaming relative in a back room of the coffee shop, harassed mall employees who did not purchase from his shop, and harangued mall patrons who bought from other shops. The tenant also failed to pay its rent on or before the first of the month as required by the lease.
The landlord sent a letter to tenant demanding that tenant strictly comply with the terms of the lease, including the timely payment of rent, and the tenant agreed to do so. However, after three months, the tenant again failed to timely pay the rent. When landlord received the January 2005 rent check on January 3, rather than January 1, the landlord refused to accept it. Landlord thereafter filed suit to recover possession of the premises. Because none of the material facts were in dispute, both landlord and tenant moved for summary judgment.
The tenant claimed the alleged breaches of the lease were not “material” and thus not sufficient to give the landlord the right to terminate the lease. The court reviewed several factors in holding the tenant’s actions to be a material breach of the lease, including the landlord’s demands, and the tenant’s agreement, to strictly comply with the terms of the lease. Further, while forfeitures (in this case, the termination of the lease) are disfavored by the law, a forfeiture is an acceptable remedy if the landlord has demanded strict performance. Finally, the tenant failed to conform to standards of good faith and fair dealing by failing to pay the rent on time after agreeing to strictly comply with the terms of the lease. Based on these factors, the court held the tenant’s actions were a material breach of the lease and entered judgment for the landlord.
With respect to the issue of the late payment of rent, tenant sought to invoke an Illinois statute that provides how days are to be counted if a day for performance falls on a holiday. The tenant claimed that because January 1st was a holiday and January 2 was a Sunday, the rent was not due until January 3 the day landlord received it. The court disagreed with the tenant’s claim. The court held that the statute relating to the computation of days applies only where there is an ambiguity as to the time computation. Because the lease clearly provided the rent must be paid on or before the first day of the month, no computation of the rent payment date was necessary and, therefore, the statute did not apply.
If you are a landlord and need assistance with a problem tenant, or if you are a tenant and have a question about your lease please do not hesitate to telephone us.