Opinion ID: 429509
Heading Depth: 2
Heading Rank: 2

Heading: Summary Judgment as to Liability

Text: 13 AIP argues that because Vareka resumed possession of The Quarters on AIP's account, on an election of remedies theory, the cause of action for damages does not accrue until the end of the term of the lease. 14 The relevant portion of the Lease provides that the landlord may, without further notice to the tenant, in the event of default, exercise any one or more of the remedies set forth in the Lease. Section 9.02(b) provides: 15 Landlord may, without barring later election of any other remedy and without terminating this lease, at any time and from time to time (i) re-enter the premises with or without process of law, and manage and operate the same (ii) sublease any vacant portion of the Premises or any part or parts thereof, to any persons, and (iii) assume Tenant's interest in any or all subleases, for the account of Tenant or otherwise, and receive and collect the rents therefrom. In the latter event Landlord shall apply such rents first to the payment of such expenses as Landlord may have paid, assumed or incurred in recovering possession of the Premises, including costs, expenses, attorney's fees, and for placing the same in good order and condition or preparing or altering the same for subleasing, and all other expenses, commissions, and charges paid, assumed or incurred by Landlord in or in connection with subleasing the Premises, and then to the fulfillment of the covenants of Tenant. Any such subleasing as provided for herein may be for the remainder of the term of this lease or for a longer or shorter period. Landlord may execute any sublease made pursuant to the terms hereof either in Landlord's own name or in the name of Tenant, or assume Tenant's interest to and in any existing sublease of the Premises, as Landlord may see fit. No subtenant shall in any such event be under any obligation for the application by Landlord of any rent collected by Landlord from such subtenant to any and all sums due and owing under the provisions of this lease. In such event Tenant shall have no right or authority whatever to collect any rent whatever from any subtenant on the Premises. In any case, and whether or not the Premises or any part thereof be re-let Tenant, until the end of what would have been the term of this lease in the absence of such expiration and whether or not the Premises or any part thereof shall [have] been re-let shall be liable to Landlord for, and shall pay to Landlord, any amount equal to: 16 (i) all Minimum Rent and Additional Rent which is otherwise payable under this lease, less 17 (ii) the net proceeds, if any, of any re-letting effected for the account of Tenant pursuant to the provisions of this Section 9.02, after deducting all Landlord's expenses in connection with such re-letting, including, without limitation, all repossession costs, brokerage commissions, legal expenses, attorneys' fees, expenses of employees, alteration costs, and expenses of preparation for such re-letting. 18 Tenant shall pay such amount to Landlord monthly on the days on which the Minimum Rent is payable under this lease, and Landlord shall be entitled to recover the same from Tenant on each such day. 19 In its May 19, 1982, order, the district court correctly stated that under Florida law, a lessor has an election of three alternative courses of action when the lease is breached by the lessee. 20 The lessor may treat the lease as terminated and retake possession for his own account, thus terminating any further liability on the part of the lessee; or the lessor may retake possession of the premises for the account of the lessee, holding the lessee liable for the difference between rental stipulated to be paid under the lease agreement and what, in good faith, the lessor is able to recover from a re-letting; or the lessor may stand by and do nothing, holding the lessee liable for the rent due as it matures, which means all remaining rent due if there is an acceleration clause and the lessor chooses to exercise the right to accelerate. 21 Coast Federal Savings and Loan Association v. DeLoach, 362 So.2d 982 (Fla.App.1978). Re-entering the premises and re-letting for the account of the lessee is, thus, a remedy available under both the Lease and Florida law. Section 9.02(b) of the Lease. 22 In this case, the parties are in agreement, and the district court concluded, that the lease has not been terminated. Vareka re-entered The Quarters to manage and operate it for the account of AIP, pursuant to section 9.02(b). AIP argues that under Florida law a lessor's cause of action for damages does not accrue until the time when the forfeited term, if it had not been forfeited, would have expired. Hyman v. Cohen, 73 So.2d 393, 398 (Fla.1954); Kanter v. Safran, 68 So.2d 553, 558 (Fla.1953). Consequently, the court's grant of summary judgment regarding liability was error at this time. AIP also cites Coast Federal Savings for the proposition that when a lessor retakes possession for the account of the lessee, he loses the right to recover the full amount of the remaining rental due under an acceleration clause. Coast Federal Savings and Loan Association v. DeLoach, 362 So.2d 982, 984 (Fla.1978). 23 Coast Federal Savings is distinguishable. In this case, Vareka does not seek to recover the full amount of remaining rental due. In its May 20, 1982, order, the district court specifically stated: 24 Issues have been raised and arguments have been presented concerning prospective rights and liabilities under the lease agreement. This ruling does not address those issues. It deals only with the liability of the defendants up to the date of trial. Whether the defendants could seek a recovery of future profits, should they ever exist, if the plaintiff continues to hold the property for their account, remains an open question. [Emphasis added.] 25 Neither Kanter nor Hyman preclude summary judgment as to liability. The district court correctly cited Chandler for the proposition that, under Florida law, parties may negotiate any contract not violative of law or public policy. Chandler Leasing Division, etc. v. Florida-Vanderbilt Development Corp., 464 F.2d 267, 271 (5th Cir.), cert. denied, 409 U.S. 1041, 93 S.Ct. 527, 34 L.Ed.2d 491 (1972). In Chandler the court stated, 26 We recognize that under the Florida case law there are three remedies available to lessors when their lessees breach a lease agreement. However, these remedies are not established as the sole remedies which may be provided for lease breaches, but are intended to supply remedies when none are provided in the lease or when broader contractual lease remedies violate public policy. 27 In this case, the lease specifically provides that when the landlord takes possession upon default and re-lets for the account of the tenant, the tenant is liable for minimum rent due minus the net proceeds of re-letting on a monthly basis. Further, the lease entitled the landlord to recover the same from Tenant on each such day. 28 Because the parties have stipulated that the lease was not terminated and that Vareka is in possession of the premises for the account of AIP, the district court correctly granted summary judgment as to liability based upon section 9.02(b) of the lease. 29