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COA reverses lease judgment for tenant, finds for landlord

March 25, 2015

A medical office that leased space from a landlord lost a judgment in its favor in a dispute over owed rent. The Indiana Court of Appeals reversed and ordered judgment in favor of the property owner.

A Jennings Circuit judge ruled for the defendant in Norris Avenue Professional Building Partnership v. Coordinated Health, LLC, 40A01-1408-PL-349, after Coordinated Health vacated the space it rented from Norris Avenue with three years left on its five-year option term. Because the tenant had paid the higher rent it agreed to pay under terms of the option extension, Coordinated Health “demonstrated its intent to be held to the option terms,” Judge Edward Najam wrote for the panel.

“Although Coordinated Health did not satisfy the condition precedent of providing the contractual notice to exercise the option terms, it manifested its intent by its affirmative act of paying the option terms’ rent payments, which were materially different than the initial term’s rent payments,” Najam wrote for the panel. “And Norris waived the condition precedent when it accepted those payments in lieu of the notices (to exercise the option).

“Accordingly, we reverse the trial court’s judgment for Coordinated Health and remand with instructions that the court enter judgment for Norris and hold any further proceedings as appropriate.”
 

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