17
Nov
Posted by webmaster as gdrw.com
Case:
Landlord leases space for Restaurant which is going to be selling
sandwiches (part of its menu) ? opening 2005 (new construction with
approved health and business plans). Landlord does not specify or does
not put it in the lease, Tenant is not able to sell sandwiches due to
local sandwich shop (Franchise) has the exclusive rights to sell
sandwiches (Sandwich shop existed before restaurant). Complaint
received by landlord by the Franchise that restaurant in the same
shopping complex is violating lease terms by selling sandwiches.
Landlord takes no action, it has been about 6 months. Sandwich shop
still threatening to file a lawsuit against the landlord and
restaurant. Two tenants in same shopping complex with conflicting
contract. Restaurant cannot stop or change the sandwich menu due to
the sales (40% of total sales) and health plan.
Problem:
Landlord is not going to do nothing and he will use its last resource
to protect himself.
Due to personal reasons (moving out of state), restaurant owners needs
to sell the business. But not able to do so because they will have to
disclose the problem which will drive any potential customer away,
cannot sell without sandwich option due to sales, and landlord most
likely never sign the lease. Moreover, trying to sell the restaurant
in this status can cause legal problems for everyone involved. It
might be a bad mistake to let landlord know about the interest in
selling the business, as well.
This is a difficult and tough question but what options does
restaurant have to get this solved soon, legally. Franchise is never going
to give the approval for another restaurant to sell sandwiches in the
same shopping complex and restaurant needs to have a documented legal
solution for it to have its value of its business.
