Rent and the Coronavirus Outbreak

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COVID-19 rent

Josh Martino, president of Bono’s Pit Bar-B-Q and Willie Jewell’s Old School Bar-B-Q in Jacksonville Beach have an unusual approach to dealing with his rent during the Covid-19 pandemic. While many other restaurants are folding or taking out large loans to try and cope with closures related, he is arguing that a provision in the law allows him to refuse to pay rent.

Martino has a law degree, although his ability to practice law in Florida is inactive, he is using his expertise in the field of law to bring landlords to the bargaining table. He claims that the government has performed a regulatory taking of restaurants’ dining space, since it is illegal for restaurants to open them.

Based on this, he doesn’t think he should have to pay rent. His claim has yet to be tested in court, but it has brought landlords who have previously refused to negotiate to the bargaining table.

This is a very interesting way to handle the unique situations provided by the novel coronavirus outbreak.

Many commercial leases have provisions that follow the idea that if the whole or any part of the premises shall be taken by any public authority under power of eminent domain, then the term of this lease shall cease as to the part so taken.

This means that an argument can be made for a rent reduction based upon Covid-19. While there is no law or supplemental authority on the topic, it’s interesting to think about what types of defenses could be made.

The broad definition of “taking private property for public use” is for taking the property in order to widen streets, put in a park, or other form of permanent destruction. However, there is no law on shutting down a business for the public good, one way or another.

This new method of interpreting it opens up new territory. This new way of interpreting the law may also pave the way for lawsuits against the government. The owners of the buildings being forced to shut down for the public good, could also fall into the same boat. Since the loans being offered are not the same as compensating them for the loss of their business, what recourse could exist against the state, counties, and cities for their taking of private property for the public good?

It will be interesting to see whether or not this is an effective way for renters to get the help they need, and how the courts will rule should it ever make it that far. In the mean time, people like Martino are using this interpretation to challenge the current way the pandemic is being handled, and to get real help that is needed during the renting crisis caused by the novel coronavirus.


Original article from the Jacksonville Business Journal:

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