Tri-City Associates, LP v. Belmont, Inc.

Tri-City Associates, LP owned and operated the Northgate Shopping Center in Rapid City. It entered into a written lease agreement with Belmont, Inc. in April 2006 for unfinished commercial space. The unfinished commercial space required substantial initial construction work before the lease was to begin on August 1, 2006. The parties experienced considerable difficulties in completing the terms of the lease. Tri-City proposed to move the start date of the lease to January 15, 2007. Belmont did not respond to the requested modification. Ultimately, Tri- City did not deliver the premises to Belmont on August 1, 2006, in the condition required under the lease and did not complete its allocated initial construction work. After Belmont did not pay rent for the first few months of the lease, Tri-City served Belmont with a notice of default under the lease. A month later, Tri-City served Belmont with a notice to quit and vacate and, in April 2007, sued to evict Belmont. Belmont answered and asserted that Tri-City materially breached the lease, which Belmont asserted relieved it of its duty to pay rent. Then, in October 2007, Belmont counterclaimed for damages for Tri-City’s failure to perform under the terms of the lease. Tri-City responded to Belmont’s counterclaim that Belmont agreed to accept the premises “as is.” Tri-City also argued that Belmont failed to provide Tri-City with written notice of Tri-City’s alleged breach and did not give Tri-City an opportunity to cure as required by the notice-and-cure provision in the lease. In this second appeal, Tri-City argued that the circuit court erred when it entered a judgment in favor of Belmont, Inc. In "Tri-City I," the South Dakota Supreme Court reversed and remanded the case for the circuit court to enter “findings of fact and conclusions of law on the effect of Belmont’s failure to give notice of breach and an opportunity to cure.” On remand, the circuit court entered supplemental findings of fact and conclusions of law, interpreting the notice-and-cure provision of the lease at issue to allow for substantial compliance and found that Belmont substantially complied. It also found that Tri-City had actual notice of its material breaches and an opportunity to cure. Alternatively, the court concluded that, by bringing suit against Belmont, Tri-City repudiated any intention to perform its obligation under the lease and made futile the requirement that Belmont strictly comply with the notice-and-cure provision. It then entered a judgment in favor of Belmont. Finding no reversible error in the trial court's judgment, the Supreme Court affirmed. View "Tri-City Associates, LP v. Belmont, Inc." on Justia Law