Marcovich Land Corp. v. J.J. Newberry Company

413 N.E.2d 935 (1980)

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Nature of the Case

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Facts

P and D entered into a 25-year written lease agreement (1953). A fire of unknown origin completely destroyed the building (1971). D refused to rebuild. P sued claiming that D violated a 'fire clause' in the lease agreement by failing to reconstruct and that as a result P was unable to operate its retail business (a variety store) on the premises. In the event the demised premises are damaged or destroyed by fire or other casualty, or damaged by the demolition of any portion of the building necessitated by the enforcement of any law or Ordinance, or declared unsafe by any public authority, the Landlord shall, at own cost [sic] and expense, immediately repair, reconstruct and replace the demised premises, including improvements, extensions, alterations and additions to building made by Landlord or Tenant, all such work to be done in compliance with State Laws and City Ordinances. P asked for specific performance. The court found that the lease agreement was in all respects valid, enforceable, and conscionable and that the parties to the lease had equal bargaining power when the agreement was made. The court awarded profits that P would have received from May of 1973 until June of 1976, (the latter being, as noted above, the date the property was condemned), apparently because it would take a year to construct a new building. D appealed.