[RPPTL LandTen] Breach of Lease/Damages/Accelerated Rentthru what date

Thu Feb 9 08:34:18 PST 2012

Here's the follow up.

Our judgments include the  present value of the full accelerated balance, with provision for future reduction for money actually received post-judgment from a new tenant. However:

*	I've heard judges opine that once the premises are re-let, the Plaintiff's recovery is cut off even if the new rate is lower or the expiration date of the new lease is earlier.

*	Others don't argue for a cut-off, but if the premises have been re-let before the judgment is entered, they want to reduce the award by the present value of the rent that the Landlord hopes to receive over the life of the new lease.

*	In one case, since the Premises had been re-rented by the time I won my Summary Judgment, the judge tried to limit my award to rent that came due before the start of the new, low rate, shorter term lease. He ended up awarding me the full accelerated balance, with provision for credit for rent actually received, but then required quarterly rent-receipt reports to the defendant!

I wonder what experiences you have had.

Jeff

Jeffrey R. Mazor, Esq.
J. R. Mazor & Associates, P.A.
Presidential Circle Building 
4000 Hollywood Blvd.,  Suite 265-s
Hollywood, FL 33021
Phone: 954-962-3500
Fax:       954-962-3560
Email:   JMazor at Mazor.com

-----Original Message-----
From: landten-bounces at lists.flabarrpptl.org [mailto:landten-bounces at lists.flabarrpptl.org] On Behalf Of Neil B. Shoter
Sent: Thursday, February 09, 2012 11:07 AM
To: 'RPPTL Landlord Tenant Committee'
Subject: Re: [RPPTL LandTen] Breach of Lease/Damages/Accelerated Rentthru what date

Yes, it would seem based on Anthony’s earlier email about using an accounting expert at trial to determine the PV calculation that you can either negotiate the rate in the lease or leave it to the court to work out a rate. 

http://www.shutts.com/shutts100.jpg

Neil B. Shoter
Partner / LEED Accredited Professional  

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Direct: (561) 650-8535 | Fax: (561) 822-5525 E-Mail <mailto:NShoter at shutts.com>  | Biography <http://www.shutts.com/attorneys-Neil-Shoter.html>  | V-Card <http://www.shutts.com/vcard-181.vcf>  | Website <http://www.shutts.com> 

From: landten-bounces at lists.flabarrpptl.org [mailto:landten-bounces at lists.flabarrpptl.org] On Behalf Of Arthur J. Menor
Sent: Thursday, February 09, 2012 10:52 AM
To: RPPTL Landlord Tenant Committee
Subject: Re: [RPPTL LandTen] Breach of Lease/Damages/Accelerated Rentthru what date

An issue that often gets overlooked in lease negotiations is the discount rate to be specifying in the acceleration clause.  The lower the rate the smaller the reduction for present value and the higher rate the greater the reduction.  In other words, the amount of the accelerated rent damages will be greater if a lower discount rate is chosen.  Therefore, when representing landlords our lease form states as follows:

If Tenant defaults, in addition to all remedies provided by law, Landlord may declare the entire balance of all forms of Rent due under this Lease for the remainder of the Lease Term to be forthwith due and payable and may collect the then present value of the Rents (calculated using a discount rate equal to the discount rate of the branch of the Federal Reserve Bank closest to the Premises in effect as of the date of the default).

Of course, if you are representing a tenant you would want to try for a higher discount rate such as a prime rate.

From: landten-bounces at lists.flabarrpptl.org [mailto:landten-bounces at lists.flabarrpptl.org] On Behalf Of Haney, Gregory
Sent: Thursday, February 09, 2012 10:30 AM
To: RPPTL Landlord Tenant Committee
Subject: Re: [RPPTL LandTen] Breach of Lease/Damages/Accelerated Rentthru what date

Absolutely agree.  When representing tenants I usually tack a NPV provision (at around 6%) onto the acceleration clause, but now I'll have to rethink trying to peg it, especially on longer term leases.

Gregory R. Haney
Attorney at Law
Shumaker, Loop & Kendrick, LLP
Bank of America Plaza
101 East Kennedy Boulevard
Suite 2800
Tampa, FL 33602
813.229.7600
813.227.2277 direct
813.229.1660 fax
ghaney at slk-law.com
www.slk-law.com <http://www.slk-law.com/>  

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From: landten-bounces at lists.flabarrpptl.org [mailto:landten-bounces at lists.flabarrpptl.org] On Behalf Of Neil B. Shoter
Sent: Thursday, February 09, 2012 10:22 AM
To: 'RPPTL Landlord Tenant Committee'
Subject: Re: [RPPTL LandTen] Breach of Lease/Damages/Accelerated Rentthru what date

Thanks Anthony.  This has been instructive.  

http://www.shutts.com/shutts100.jpg

Neil B. Shoter 
Partner / LEED Accredited Professional  

________________________________

Shutts & Bowen LLP 
1100 CityPlace Tower, 525 Okeechobee Boulevard | West Palm Beach, FL 33401 
Direct: (561) 650-8535 | Fax: (561) 822-5525
E-Mail <mailto:NShoter at shutts.com>  | Biography <http://www.shutts.com/attorneys-Neil-Shoter.html>  | V-Card <http://www.shutts.com/vcard-181.vcf>  | Website <http://www.shutts.com> 

From: landten-bounces at lists.flabarrpptl.org [mailto:landten-bounces at lists.flabarrpptl.org] On Behalf Of Anthony J. Horky
Sent: Thursday, February 09, 2012 10:16 AM
To: 'RPPTL Landlord Tenant Committee'
Subject: Re: [RPPTL LandTen] Breach of Lease/Damages/Accelerated Rent thru what date

Recovery of accelerated rent is recovery of future economic losses.  I do not have a Florida Supreme Court case directly on point, but I have seen a number of DCA opinions stating that recovery of accelerated rent must be reduced to present day value.  See Vibrant Video, Inc. v. Dixie Pointe Associates, 567 So.2d 1003 (Fla. 3d DCA 1990); NEP Int’l, Inc. v. Falls, 629 So.2d 1019 (Fla. 4th DCA 1993); Florida Standard Jury Instruction 501.7. See, e.g. Braddock v. Seaboard Air Line R.R., 80 So.2d 662, 668 (Fla. 1955)(“…present compensation of future pain is merely one of the subjective elements of the problem, and is not a process of mathematical calculation of preset value, such as must be applied to periodic future pecuniary losses); Quintero-Chadid Corp v, Gersten, 582 So.2d 685,689 (Fla. 3d DCA 1991)(court noted that Vibrant Video held that a landlord’s future monetary losses had to be reduced to present value).  

Regards,

Anthony J. Horky, Esquire

Anthony J. Horky, P.A.

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From: landten-bounces at lists.flabarrpptl.org [mailto:landten-bounces at lists.flabarrpptl.org] On Behalf Of Neil B. Shoter
Sent: Thursday, February 09, 2012 9:37 AM
To: 'RPPTL Landlord Tenant Committee'
Subject: Re: [RPPTL LandTen] Breach of Lease/Damages/Accelerated Rent thru what date

While I have not researched this, the question of whether accelerated rents “must” be discounted to present value if such is not stated in the lease arises from time to time, and I understand that judges do discount the amount to PV – BUT, is the discounting accelerated rents to PV a “mandatory” or uniform practice across courts in Florida or only followed in certain jurisdictions??   

This is useful in cases where a landlord refuses to allow mention in the lease of discounting to PV. 

http://www.shutts.com/shutts100.jpg

Neil B. Shoter 
Partner / LEED Accredited Professional  

________________________________

Shutts & Bowen LLP 
1100 CityPlace Tower, 525 Okeechobee Boulevard | West Palm Beach, FL 33401 
Direct: (561) 650-8535 | Fax: (561) 822-5525
E-Mail <mailto:NShoter at shutts.com>  | Biography <http://www.shutts.com/attorneys-Neil-Shoter.html>  | V-Card <http://www.shutts.com/vcard-181.vcf>  | Website <http://www.shutts.com> 

From: landten-bounces at lists.flabarrpptl.org [mailto:landten-bounces at lists.flabarrpptl.org] On Behalf Of Manuel Farach
Sent: Wednesday, February 08, 2012 5:43 PM
To: RPPTL Landlord Tenant Committee
Subject: Re: [RPPTL LandTen] Breach of Lease/Damages/Accelerated Rent thru what date

I think the court sets what it believes to be an appropriate present value as applied to each case; I’m not aware of a case that gives a certain percentage.

As to question two, the answer is yes. I’ve filed partial satisfactions of the judgment once payments were made

Good luck!

Manny

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Manuel Farach / Of Counsel - Board Certified in Real Estate Law and Business Litigation by The Florida Bar

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From: landten-bounces at lists.flabarrpptl.org [mailto:landten-bounces at lists.flabarrpptl.org] On Behalf Of Jeff Mazor 
Sent: Wednesday, February 08, 2012 5:29 PM
To: 'RPPTL Landlord Tenant Committee'
Subject: [RPPTL LandTen] Breach of Lease/Damages/Accelerated Rent thru what date

I’ve researched this to death and haven’t found a direct answer. Maybe you can help?

Question One: If not provided for in the Lease, what discount rate do you use to calculate the Present Value of sums that come due under a lease? 

Question Two: IF we sue for damages under an “Original Lease”, we are entitled to a judgment equal to: 

(i)   past due rent, repair expense and other charges; plus,

(ii)  landlord's attorneys' fees and costs; plus, 

(iii) “accelerated balance” due under the lease, less a credit for "the amount received upon reletting the premises", Boulevard Shoppes, A.B. v. Pro-1 Realty, Inc.605 So.2d 1317 (Fla., 4th DCA, 1992), reduced to present value.

Thanks, 

Jeff Mazor

Jeffrey R. Mazor, Esq.

J. R. Mazor & Associates, P.A.

Presidential Circle Building 

4000 Hollywood Blvd.,  Suite 265-s

Hollywood, FL 33021

Phone: 954-962-3500

Fax:       954-962-3560

Email:   JMazor at Mazor.com

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