Opinion ID: 1606319
Heading Depth: 1
Heading Rank: 2

Heading: Plaintiff's Theory of Breach of Contract

Text: Plaintiff also advances the theory that the defendants breached a covenant contained in the lease by not maintaining the August, 1973 mortgage and are therefore liable to the plaintiff. In the Amendment to the Complaint, it is alleged that defendants had a duty to pay the installments of the August 15, 1973, mortgage pursuant to the terms of the March 20, 1963, lease, and that any refinancing of the mortgage was to be in accordance with the terms of the lease. While it is true that TraveLodge agreed in the lease to maintain the Life & Casualty mortgage and any refinancing of that mortgage, it appears from the evidence that the August, 1973 mortgage was not a refinancing of the Life and Casualty mortgage as defined in the lease. Under Article III of the lease, a refinancing to which Travelodge's lease covenant to maintain the Life & Casualty mortgage applied was one (a) limited to the principal balance remaining due on the Life and Casualty mortgage, (b) payable on equal or lessor terms of interest than 6¼% and (c) maturing not later than April 7, 1973. Article III specified that in the event of such a refinancing, the lessor could not be required to execute a new mortgage or to assign the lease as security. The August, 1973 mortgage loan (a) was in the amount of $180,000 rather than in the amount of the principal balance remaining due on the Life and Casualty mortgage ($58,722.70), (b) was at an interest rate of 9% rather than a rate equal to or less than a 6¼% and (c) had a maturity date in 1983 rather than April 7, 1973. Moreover, the lessor agreed to and did in fact execute the new mortgage, in which the lessor's interest in the lease was assigned as security. Under the facts, the August, 1973 mortgage financing was not a refinancing within the terms of the lease, and the lease therefore did not oblige TraveLodge to make payments on the August, 1973 mortgage debt. This Court concludes that none of the defendants breached any contractual obligation owed to the Whighams relative to the payment or financing of the August, 1973 mortgage, and therefore the plaintiff has no contractual basis for the relief he demands.