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Keywords

lawsuittrialleasecorporationsecurity deposit

appealleasecorporationsecurity deposit

Related Cases

Mullendore Theatres, Inc. v. Growth Realty Investors Co., 39 Wash.App. 64, 691 P.2d 970

Facts

In 1969, Conner Theatres Corporation leased part of the Jones Building in Tacoma, requiring a $22,500 security deposit. The lease stipulated that if the tenant was not in default, the deposit would be returned at the lease's expiration. After several property transfers, Mullendore Theatres, Inc. took over the lease and later released claims against the City of Tacoma regarding the security deposit, leading to a lawsuit against Growth Realty, the successor landlord, for the return of the deposit.

In 1969, Conner Theatres Corporation became tenant of a part of the Jones Building in Tacoma under a lease that required a deposit of $22,500 as security for performance of the tenant's obligations.

Issue

Does a landlord's covenant to refund a tenant's security deposit run with the land, thus obligating a successor landlord to refund it?

Rule

A lease covenant does not run with the land unless it touches or concerns the land, enhancing its value and conferring a benefit upon it.

A lease covenant does not run with the land unless it touches or concerns the land.

Analysis

The court analyzed whether the covenant to refund the security deposit was related to the land. It concluded that the covenant did not require the landlord to use the deposit for property-related expenses, nor was it directly tied to the land's value. Therefore, the covenant was deemed personal and did not run with the land, despite the lease's language.

The landlord was not required to spend the money for repairs or maintenance, or in any other way related to the property.

Conclusion

The court reversed the trial court's decision, ruling that the landlord's covenant to refund the security deposit did not run with the land.

Reversed.

Who won?

Growth Realty prevailed in the case because the court found that the covenant to refund the security deposit was personal and did not run with the land, thus not obligating them to refund it.

Growth appeals, contending that the covenant did not run.

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Keywords

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