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Renaissance Development Corp. v. Buca V, LLC

United States District Court, D. Massachusetts

July 10, 2019



          Leo T. Sorokin United States District Judge

         Two of the defendants[1] leased a property in Shrewsbury, Massachusetts from Renaissance Development Corp. (“Renaissance”) for the purposes of opening a restaurant. Thereafter, the parties entered into multiple amendments into the lease, with additional defendants acting as guarantors. After a first round of litigation in this Court, the parties entered into a Forbearance Agreement in April 2016 which altered some of the provisions of the lease. In August 2018, Renaissance initiated a second suit in this Court alleging that the defendants breached both the lease and the Forbearance Agreement. For the reasons that follow, Renaissance's motion for partial summary judgment is DENIED.

         I. BACKGROUND

         A. The Lease

         Renaissance owns a property located in Shrewsbury, Massachusetts (“the premises”). Doc. No. 33 ¶ 3. Renaissance and Buca V are parties to a Commercial Property Lease (“the lease”) in which Renaissance rents the premises to Buca V for the purpose of opening a restaurant.[2] Id. The following portions of the lease are relevant to the resolution of the pending motion.

         Section 5.5(a) of the lease requires the lessee, Buca V,

to make all repairs, alterations, additions, or replacements to the [premises] required by any law or ordinance or any order or regulation of any public authority because of Lessee's use of the [premises], to keep the [premises] equipped with all safety appliances and equipment so required because of such use; to procure any licenses and permits required for any such use; to pay all municipal, county, or state taxes assessed against the leasehold interest hereunder, and to comply with the orders and regulations of all governmental authorities . . .

Doc. No. 25-1 at 11. Section 5.5 (g) requires the lessee

not to abandon or vacate the [premises] during the Initial Term or any Extended Term; provided, however, that Lessee shall not be deemed to be in violation of this covenant if Lessee shall vacate the [premises] for a period not to exceed six (6) months so long as Lessee is actively attempting to assign or sublet the Lease and the Lessee is not otherwise in default of this Lease. This section shall not apply to any period related to an event of damage by fire, casualty, condemnation or otherwise, nor to any period in which the restaurant is closed because Lessee is changing the concept of said restaurant.

Id. at 12. Additionally, the lease contains a cure provision which sets forth the timeline upon which the lessee is required to cure any breaches of the lease. Section 15.2 states that

[i]f: (a) Lessee shall fail to perform or observe any other term or condition contained in this Lease and such failure is not cured within thirty (30) days after notice thereof or such longer period of time as is necessary to effect the cure so long as Lessee has used and continues to use all due diligence to effect the cure . . . (d) then, the Lessor shall have the rights and remedies provided for in Section 15.3.

Id. at 24-25.

         B. The First and Second Amendments

         In August 2010, Renaissance and BRI (who was at that time the lessee) entered into the First Amendment. Doc. No. 33 ¶ 7. “Among other things, the First Amendment changed the rent payable by BRI to [Renaissance] and extended the term of the Original Lease from May 31, 2011 to May 31, 2020.” Id. ¶ 8. The First Amendment also contained a provision which stated that “[e]xcept as amended hereby, the Lease is ratified and remains in full force and effect.” Doc. No. 25-2 at 7.

         In January 2014, BRI assigned its rights and interest in the lease to Buca V. Doc. No. 33 ¶ 10. In September 2014, Renaissance and Buca V entered into the Second Amendment. Id. ¶ 11. “The primary purpose of the Second Amendment was to comply with an earlier request by [Buca V], Buca and BRI to remove [another premises] from the Lease.” Id. ¶ 12. Under the Second Amendment, Buca V remains liable for the full amount of rent owed under the lease. Id. ¶ 14. The Second Amendment also contained a provision stating that the lease remained in full force and effect, except as amended therein. Id. ¶ 15.

         At the same time that Renaissance and Buca V executed the Second Amendment, Buca and BRI entered into a Guaranty (“2014 Guaranty”) whereby they guaranteed performance of the lease, as amended. Id. ¶ 13.

         C. The First Litigation

         Within a few months, Buca V ceased making payments under the lease and vacated the premises. Id. ¶¶ 16-17. Thereafter, Renaissance filed an action in this Court alleging that Buca V breached the lease and that Buca and BRI breached their obligations under the 2014 Guaranty. Id. ¶ 18. This Court entered judgment in favor of Renaissance on all counts. Id. ¶ 19. The defendants appealed the judgment, but then settled their dispute by entering into a Forbearance Agreement with Renaissance on April 1, 2016. Id. ¶¶ 21-22. The Forbearance Agreement was signed by a representative from the five defendants in this matter. Doc. No. 25-7 at 8. Planet Hollywood and Buca C also executed a guarantee (“Forbearance Guarantee”) of Buca V's obligations to Renaissance under the lease and the Forbearance Agreement. Doc. No. 25-8.

         The Forbearance Agreement includes a provision in which Renaissance agrees to allow Buca V to pay $25, 000 per month (“Monthly Forbearance Payments”), rather than the previously agreed-upon monthly rent of $36, 299.23 (“Monthly Rent Payments”). Doc. No. 25-7 at 4. However, the Forbearance Agreement also provides that if any of the defendants default under the lease or the Forbearance Agreement, then Renaissance's acceptance of the lower monthly payment shall be voided. Id. In that case, the defendants will be liable to Renaissance for the ...

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