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Your Connecticut Tenant Has Just Vacated. What’s A Landlord to Do?


Unless a contrary relief was negotiated in the lease in advance, the law regarding damages for breach of lease under Connecticut law is surprisingly straightforward: A Landlord is entitled to seek as damages, an amount that would place the Landlord in the same position that it would have been had the Tenant fully performed under the lease, i.e., if a 10-year lease is valued at $1 million and the Tenant vacates after the first year the Landlord should be entitled to $900,000 – with everything else being equal. Initially, this formula does not seem to allow much wiggle room for misinterpretation.

Under Connecticut law, when a commercial Tenant breaches a lease and vacates, the Landlord has two options: (1) it can immediately terminate the tenancy and sue the Tenant for damages flowing from the Tenant’s breach of lease; or (2) it can refuse to accept the Tenant’s surrender, but instead periodically sue the Tenant for nonpayment of the outstanding rent – no future rent; no acceleration of rent, just simply what is due at that time. The first action is an action for “Breach of Lease,” and the second action is properly termed “Nonpayment of Rent.” Although these two actions are often assumed to be interchangeable, in reality they are distinct and mutually exclusive principles. As a technical matter, an action for nonpayment of rent is not actionable if the lease has already been terminated, whereas an action for breach of lease cannot be brought unless the lease has already been terminated. One more important distinction: In Connecticut, a Landlord who chooses to terminate a commercial Tenant’s lease must prove that it has attempted to mitigate its loss before seeking monetary damages. However, a Landlord who refuses to accept the Tenant’s surrender has absolutely no duty whatsoever to mitigate its damages.

While in a depressed rental market it may be tempting for a Landlord to refuse the surrender, the reality is that most landlords would rather be proactive and efficient. Consequently, most Landlords will preemptively terminate the Tenant’s lease and then immediately sue the Tenant for damages flowing from the breach.

Once the lease is terminated, Connecticut law requires the Landlord to use “reasonable efforts to mitigate.” Reasonable efforts mean doing everything reasonable, not everything possible. Further, the Landlord does not need to sacrifice any substantial rights of its own or “exalt” the interests of the now-departed Tenant above its own. Just reasonable efforts. Nothing more. (After all, it was not the Landlord that breached the lease.) Yet, some judges (not all) will insist on having the Landlord prove that it has done everything possible before entering an order for damages in favor of the Landlord for the value of an unexpired lease. As one judge recently said to me: “How do I know that your client will not turn around and lease the space tomorrow, or a week from now?” Valid question, but really beside the point. What is sometimes lost in the damages/mitigation principle is that it is designed to provide a prospective remedy: It rewards the Landlord based on its ability to prove to the court that it has made reasonable efforts to mitigate the damages as of that date (of the hearing or trial). In my opinion, there is no legal requirement for the Landlord to return to court to give back a portion of whatever award it garnered even if it finds a replacement Tenant six months from the date of the award. However, it is precisely because of this “double-dipping” scenario that causes legitimate apprehension for some judges when they contemplate awarding full damages in these situations. So some judges will therefore place a cap on the Landlord’s damages to take into account the real possibility that the Landlord will in fact find a replacement Tenant for that space at some point before the natural expiration term of the lease. It is the responsibility of the Landlord’s attorney to present contrary evidence in an attempt to stretch the Judge’s cap closer towards the full value of the unexpired lease term than away from it.

In conclusion, although in theory a Landlord’s remedies for breach of lease appears straightforward from a distance, there may be a series of variables and nuances that the Landlord must recognize and account for in seeking monetary damages that reflect the full value of the unexpired lease. This is assuming, of cours