Stop & Shot, Inc. v. Ganem

Plaintiff leased a building from defendant for a grocery store, and promised to pay a flat rent plus percentage of sales rent. Then plaintiff opened another competing store within ½ mile, and another one within a mile, and no longer had to pay percentage rent because of the diversion of business.

Defendant sought declaratory relief. Judgment for plaintiff.

Whether there is in a lease an implied covenant to continue operations and not to open a competing store when the rent is based on income.

Claim dismissed, and judgment for plaintiff.

An apparently substantial minimum rent in a complete written lease gives ground for the inference that fixed rent and the lessee’s self-interest in producing sales is all that the lessor requires.