Tyler Smith won an appeal to the Maine Supreme Judicial Court, sitting as the Law Court, overturning a trial court decision that had enforced an unfavorable lease-extension against the firm’s client until the year 2059. In fact, the Law Court did not just overturn the trial court’s decision granting summary judgment to the tenant; it went one step further and ordered the trial court to grant summary judgment in favor of our client, putting an end to the lawsuit entirely.
Our client took a multi-million dollar mortgage on an airport property with an existing lease. Without our client’s knowledge or consent, the owner of the property unlawfully extended the lease by 40-years, and granted the tenant additional rights that substantially devalued the property. After the owner defaulted and our client retook the property by foreclosure, the tenant sued to enforce the 40-year extension.
The trial court ruled that the 40-year extension was lawful because, according to the trial court, the owner of the property retained the power to amend the existing lease during the period of the mortgage. Tyler successfully negotiated dismissal of the tenant’s other claims so that an appeal could be filed, and filed a notice of appeal to the Law Court. He then argued on appeal that the mortgage took priority over the lease extension and that the lease extension was extinguished by the foreclosure. The Law Court’s decision, Littlebrook Airpark Condominium Assoc. v. Sweet Peas, LLC, 2019 ME 3, — A.3d —, was unanimous in favor of our client. As a result, the client’s property will be freed of the lease later this winter.