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NICHOLAS G. PERAKIS v. LUCERNE ENERGY (06/21/89)

filed: June 21, 1989.

NICHOLAS G. PERAKIS
v.
LUCERNE ENERGY, INC. AND AG SERVICES, INC. V. AMERICAN BANK AND TRUST COMPANY OF PENNSYLVANIA, R-TOWNE DEVELOPMENT COMPANY, AND YORK COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY



Appeal from Judgment Entered June 29, 1988, Court of Common Pleas, Civil Division, Indiana County No. 734 CD 1985.

COUNSEL

Michael Handler, Indiana, for appellants.

Morton J. Earley, Indiana, for Perakis, appellee.

Cavanaugh, Del Sole and Montgomery, JJ.

Author: Cavanaugh

[ 385 Pa. Super. Page 303]

This is an appeal from a judgment entered in favor of a commercial landlord, appellee Perakis, for the amount of unpaid rent due from tenants after they had vacated the

[ 385 Pa. Super. Page 304]

    premises prior to the expiration of the lease term. On appeal, the tenants allege error by the lower court in not finding that under the terms of the lease agreement they were free to terminate the lease prior to the stated end of term date.

The property in question is a commercial facility which landlord's predecessor in interest, R-Towne Development Company, had leased to tenants, Lucerne Energy, Inc. and A.G. Services, Inc. Perakis had arranged to purchase the property with financing provided through the York County Industrial Development Authority (IDA) in order to take advantage of certain federal tax exemptions. On December 31, 1984 title to the property was conveyed to IDA, and Perakis leased the property from IDA after it issued notes and mortgages to American Bank and R-Towne. On the same date R-Towne assigned to Perakis its interest in the lease with appellants.

On January 21, 1985, appellants attorney informed Perakis that appellants intended to vacate the premises by February 1, 1985, eleven months prior to the termination date set in the lease. The basis for this early termination was the asserted breach by landlord of the paragraphs in the lease relating to a taking for public use and quiet enjoyment. No rental payments were remitted after January, 1985.

The lower court found that there had been no breach by landlord and, therefore, rental for each of the remaining eleven months was due. On appeal, tenants present argument that the terms of the lease allowed them to terminate the lease and vacate the premises.

The clauses of the lease in question provide as follows:

12. Taking for Public Use -- Lessor agrees that if said premises, or any part thereof, shall be taken by any Government or Governmental authority by eminent domain proceedings or otherwise, for any purpose whatsoever, Lessee shall have the right to terminate this Lease at the end of any rental month by serving upon Lessor not less than ...


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