The Leasing Hotline

A tenant is not obligated to remove fixtures from the leased premises that were installed prior to the commencement of the lease. 2401 Walnut, L.P., v. American Express Travel Related Services Company, Inc., Civ. No. 07-1281, United States District Court for the Eastern District of Pennsylvania, Jan. 24, 2008.

The landlord, who had acquired the building from a third party, leased space in a building to American Express. Prior to the landlord's acquisition of the building, American Express had also acquired the stock and other assets of the third-party's business in a Stock Purchase Agreement, but not the building itself. In addition, prior to the commencement of the lease, certain items were installed in the building, including kitchen fixtures, specialized rooms, customized trade spaces, satellite dishes, customized fixtures, gym lockers, signage, piping from water purification systems and superfluous cabling and wiring throughout the building. The lease provided that American Express was required to remove all 'furniture, trade fixtures, office equipment and all other items of the Tenant's property' prior to vacating the building. Four days prior to the termination of the lease, the landlord sent a letter to American Express, requiring American Express to remove the above named items. American Express replied, stating it had no obligation to do so because it had not installed any alterations, additions, improvements or fixtures to the property. After several letters were exchanged, the landlord sent a contractor's estimate to American Express with the cost of removing the above named items. The landlord commenced an action against American Express for breach of lease and American Express moved for summary judgment. The court granted the motion, holding that the lease did not require American Express to remove items that were fixtures prior to the commencement of the lease. It considered that American Express provided sufficient evidence to prove that the items in dispute were fixtures and the landlord was unable to support a contrary conclusion.