For the last year, there has been a growing stack of lawsuits between commercial landlords and tenants over their lease rights and obligations during the COVID-19 pandemic. Landlords are suing for unpaid rent. Tenants are responding that rent should be excused. Although a handful of these cases have been decided in other states, we are not aware of any such decision in Minnesota – until now.
On March 30, 2021, Ramsey County District Court Judge Thomas Gilligan entered summary judgment for Anthony Ostlund’s client, 1800 Baxter, in its action to collect rent from Portillo’s, a Chicago-based chain restaurant that leases space from 1800 Baxter in Roseville, Minnesota. This is the first court order we have seen in Minnesota that resolves a pandemic-related landlord-tenant dispute.
The lawsuit arose because Portillo’s has not paid rent for its Roseville location since March 2020 – despite being open for drive-through and takeout business throughout the pandemic, and despite being partially open for dine-in service as well. When Portillo’s withheld its first rental payment, 1800 Baxter hired Phil Kaplan of Anthony Ostlund to collect from Portillo’s. After taking discovery, Phil moved for summary judgment, arguing that the terms of the parties’ Lease, as well as a Lease Amendment and Estoppel Certificate that Portillo’s signed, foreclosed any defense Portillo’s had to 1800 Baxter’s claims. The Court agreed with Phil’s argument and granted the motion.
The moral of the story: contracts still matter, even in a pandemic.