The Leasing Hotline

Competing Store Does Not Interfere with Quiet Enjoyment

Where the lease does not prohibit the landlord from operating a competing store next door to the tenant, a tenant cannot prevail on a quiet enjoyment theory. Ghanbari v. Tran d/b/a M.D. Market, No. 09-06-548 CV, Court of Appeals of Texas Ninth District, Beaumont, March 1, 2007.

The landlord leased part of a building to the tenant to operate a convenience store and used the rest of the building as a warehouse. A few years later, the landlord and tenant had a dispute regarding parking rights. When the tenant refused a rent increase, the landlord fenced in part of the parking lot, blocking customer access to the store from the parking lot. The tenant then sought a restraining order requiring the landlord to remove the fence and later sought an injunction restraining the landlord from obstructing the tenant's use of the parking lot. Thereafter, the landlord opened a convenience store in the portion of the building previously used as a warehouse. The tenant filed an emergency motion for contempt, arguing that the landlord violated the temporary injunction by operating a store and using the lot. The tenant further argued that the landlord had constructively evicted the tenant.

The trial court granted the tenant a temporary injunction and ordered the landlord to close the store. It held that the alleged breach was based upon an implied covenant of quiet enjoyment. The appellate court reversed, holding that the lease agreement contained no non-competition covenant; nor could the tenant demonstrate that the landlord otherwise agreed not to compete with the tenant. It held that although the tenant demonstrated financial damage due to the landlord's operating a store, she could not prove abandonment, which is required to prevail on a quiet enjoyment theory. The appellate court held that because the tenant did not vacate the leased premises, she failed to prove that she was 'constructively evicted'; and without abandonment evidence, the tenant could not show that she had a right to recover.

Competing Store Does Not Interfere with Quiet Enjoyment

Where the lease does not prohibit the landlord from operating a competing store next door to the tenant, a tenant cannot prevail on a quiet enjoyment theory. Ghanbari v. Tran d/b/a M.D. Market, No. 09-06-548 CV, Court of Appeals of Texas Ninth District, Beaumont, March 1, 2007.

The landlord leased part of a building to the tenant to operate a convenience store and used the rest of the building as a warehouse. A few years later, the landlord and tenant had a dispute regarding parking rights. When the tenant refused a rent increase, the landlord fenced in part of the parking lot, blocking customer access to the store from the parking lot. The tenant then sought a restraining order requiring the landlord to remove the fence and later sought an injunction restraining the landlord from obstructing the tenant's use of the parking lot. Thereafter, the landlord opened a convenience store in the portion of the building previously used as a warehouse. The tenant filed an emergency motion for contempt, arguing that the landlord violated the temporary injunction by operating a store and using the lot. The tenant further argued that the landlord had constructively evicted the tenant.

The trial court granted the tenant a temporary injunction and ordered the landlord to close the store. It held that the alleged breach was based upon an implied covenant of quiet enjoyment. The appellate court reversed, holding that the lease agreement contained no non-competition covenant; nor could the tenant demonstrate that the landlord otherwise agreed not to compete with the tenant. It held that although the tenant demonstrated financial damage due to the landlord's operating a store, she could not prove abandonment, which is required to prevail on a quiet enjoyment theory. The appellate court held that because the tenant did not vacate the leased premises, she failed to prove that she was 'constructively evicted'; and without abandonment evidence, the tenant could not show that she had a right to recover.