Pak v. Korean Farm, Inc.
Published: Sep. 20, 1997 | Result Date: Aug. 15, 1997 | Filing Date: Jan. 1, 1900 |Case number: BC172759 Verdict – $110,574
Judge
Court
L.A. Superior Central
Attorneys
Plaintiff
Defendant
Facts
This case involved redevelopment of the three-level building into a retail shopping center. The defendant tenant leased the first floor as a gutted shell under a lease which stated that the first floor was to be used and occupied as a supermarket with the tenant to build its own tenant improvements. The lease provided that the landlord complete certain demolition and "broom clean," followed by three months "free rent," after which the tenant was to begin paying $32,500 per month. Under the lease, the tenant had 60 days to obtain permits for its supermarket or to terminate the lease. The tenant obtained a permit for approximately 60% of the space during the 60-day period, but was denied a permit for 40% of the space. The tenant elected not to terminate, but rather demanded that the landlord obtain a zoning variance. The tenant refused to begin paying rent and refused to continue development of a supermarket unless and until the landlord succeeded in obtaining the demanded zoning variance. The landlord replied that it had no responsibility under the lease to obtain a zoning variance. The landloard served a 3-day notice to quit for failure to pay rent and a 30-day notice to diligently act to open for business as a supermarket. The tenant contended that the three months "free rent" never started, and thus the duty to begin rent payments never started, due to failure of the landlord to properly demolish and "broom clean." The tenant admitted that it never had sent written notice to the landlord stating the claimed defects in demolition and broom cleaning.
Settlement Discussions
Prior to trial, the tenant rejected a settlement offer that would have reset the clock on the "free rent" with the tenant to have additional time, and the landlord's cooperation, to seek a zoning variance at the tenant's risk.
Other Information
The settlement was reached approximately three months after the case was filed. A settlement conference was held on Aug. 11, 1997 before Uzzell S. Branson III of JSOP. It did not resolve the matter.
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