Case Law Summaries

Hartz Mountain Associates v. LML Supermarkets, Inc.

• Opinion Date: November 9, 2001
• Real Property Law
• E-Mail

LEASES; INTERPRETATION—Courts will reject literal and non-contextual readings of a lease where such a reading would abrogate the import of a paragraph as a whole.

A supermarket lease permitted a tenant to cease conducting its business in the premises by giving its landlord sixty days notice of that intention. The landlord then had the option to cancel a lease on thirty days written notice and “this Lease shall be deemed cancelled and terminated on such thirtieth (30th) day.” Another portion of the same paragraph required that the tenant “remain open for business in the Premises until Lessee has received notice of Lessor’s election to recover the Premises ... .” The supermarket gave its landlord appropriate notice, however the landlord never responded. The supermarket then closed, and its landlord sought an injunction to restrain the supermarket from ceasing operations in, and vacating, the demised leased premises. Its argument was that its tenant never received notice of its, the landlord’s, election to recover the premises. The lower court rejected “such a literal and non-contextual reading of the clause” because it “would entirely defeat and abrogate the import of the paragraph as a whole, which was patently designed to permit the tenant to vacate” the premises on the prescribed notice. The Appellate Division confirmed, stating that, “it is virtually axiomatic that if the terms of the contract are clear and unambiguous, the court is obliged to enforce the contract as written and may not make a different or better contract than the parties have agreed to.” The Court was not interested in discerning “exactly what the parties may have intended.” It speculated that the clause “may have been simply the result of inartful drafting,” or something else, nonetheless it was persuaded that whatever the lease clause may have meant, it could not “be interpreted as qualifying the tenant’s right of vacation on sixty days’ notice ... .”

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