Question
Josh operated a restaurant in Welland. Josh rented the premises from Stefon.The Lease for the restaurant premisesincluded a provision that the Tenant would complete the
Josh operated a restaurant in Welland. Josh rented the premises from Stefon.The Lease for the restaurant premisesincluded a provision that the Tenant would complete the all maintenanceand repairs to the building and allowedthe Landlord to complete periodic inspections.If an inspection revealedthat any repairs were requiredtheTenantwasrequired tocorrectanydeficiencieswithin60days.
The initial5 year term of the Lease expiredon September 30. The Lease included an option for the Tenant to renew the Lease for an additional5 year term provided that notice exercisingthe option to renew was giventotheLandlord byMay31.
OnApril1,StefoncompletedaninspectionandprovidedalistofdeficienciestoJoshtogether withanotice thatalldeficienciesweretobecorrected within60days.
On April 10, Stefonadvised Josh that he was listing the property for sale. Josh indicatedthat he was interested in purchasingthe property and asked if the time for completingthe repairscould be extendedsince he might make more extensiverenovations if he owned the property.Stefon agreedand said that he wouldallowJoshtomatchanyofferhereceived.
OnJune1,StefontoldJoshthathehadreceived andacceptedanoffertosellthepropertyfor$3,000,000.00 and that the Buyer requiredvacant possession.He also deliverednotice to Josh terminatingthe Lease since JoshhadbreachedtheLeasebynotcompletingtherepairs within60days.
Josh saidthat:
- hewouldcommence andcompletetherepairs within60days;
- hewasexercisinghisrighttorenewtheLease;
- hewouldmatchtheoffertopurchase for$3,000,000.00.
Stefonsaid it was too late and that Josh did not have a legal right to do those things, nor did Stefonhaveanyfurther legalobligationstoJosh.
Joshcomes toyouforadvice.
Required: Explainin detail the applicable legal principles and provide an analysis of how they apply tothefactsofthiscaseandthepositionstakenbytheparties.Whatisthelikelyresultofanylegalaction?
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