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350 Main Street LLC v. Ren Guan Li D/B/A Sun Hing Restaurant

March 21, 2011

350 MAIN STREET LLC, PLAINTIFF-RESPONDENT,
v.
REN GUAN LI D/B/A SUN HING RESTAURANT, DEFENDANT-APPELLANT.



On appeal from Superior Court of New Jersey, Law Division, Essex County, Docket No. L-3732-08.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued November 3, 2010

Before Judges Wefing, Payne and Baxter.

Defendant, Ren Guan Li, d/b/a Sun Hing Restaurant, a commercial tenant, appeals a February 18, 2010 amended judgment of possession entered against defendant and in favor of the plaintiff landlord, 350 Main Street LLC. Following our review of the record of this matter in light of applicable law, we affirm.

I.

On April 17, 2006, defendant entered into a commercial lease with predecessor landlord QAD, Inc., intending to utilize the leased space as a Chinese restaurant. Paragraph 5 of the lease*fn1 required defendant, as tenant, to maintain the premises, but provided that the landlord would be responsible for structural repairs and repairs to the heating, plumbing systems and the water/sewer lines. Paragraph 6 prohibited defendant from making alterations and improvements to the premises without written approval by the landlord. Pursuant to paragraph 8, defendant was not responsible for payment of water charges, but defendant was required to pay for all other utilities. Paragraph 28 granted to the landlord and its agents a right of entry for the purposes of inspection and performance of necessary repairs or alterations. Paragraph 21 itemized events of default under the lease, including non-payment of rent and the non-performance of any covenants and conditions of the lease following written notice and an unspecified period for cure. Paragraph 22 provided:

If an Event of Default occurs, the Landlord may, at any time thereafter, terminate this Lease and the term hereof, upon giving to the Tenant five (5) days notice in writing of the Landlord's intention so to do. Upon the giving of such notice, this Lease and the term hereof will end on the date fixed in such notice as if such date was the date originally fixed in this Lease for the expiration hereof; and the Landlord will have the right to remove all persons, goods, fixtures and chattels from the Premises, by force or otherwise, without liability for damage.

On August 29, 2007, the lease was assigned to 350 Main Street, an entity owned by Olivia and Albert Chen, following its purchase of the property.

Landlord-tenant difficulties, which had also manifested during QAD's period of ownership, continued. As the result of an inspection conducted on August 29, 2007, defendant was found to have grease containers in the rear yard with improper loose-fitting lids that also lacked a removable cap to permit filling of the drums. Additionally, the water drainage system improperly emptied into the driveway, creating free-standing water in the area where the containers, which were not properly raised off the ground, were stored. An old stove had been discarded behind the restaurant that served as a potential harbor for vermin, and debris was present in the area around the grease containers. Defendant was ordered to stop the water flow in the vicinity of the grease containers; clean the area around the containers; raise, clean and maintain the containers; remove the old stove; and repair an opening along the bottom panel of the restaurant's storm door that permitted entry by vermin. The facility was issued a "conditional" placard as the result of the inspection.

In a November 16, 2007 letter, counsel for plaintiff advised defendant of issues that defendant needed to address, consisting of (1) improper installation of a heating system in violation of building codes, resulting in the emission of gasses into the ceiling of the restaurant, thereby creating a health and fire hazard; (2) improper installation of an indoor climate system, requiring repair; (3) unauthorized use of more than fifty percent of the basement area; and (4) improper discharge of water from the restaurant's ice machine into the area containing the grease containers, which were improperly sealed, thus causing a rodent problem. A demand for cure of the cited conditions within ten days was made.

On November 26, 2007, Albert Chen and the restaurant were cited for maintaining a public health nuisance as the result of the presence of foul-smelling cooking oil all over the driveway.

A January 23, 2008 letter to counsel for defendant advised that rent had not been paid for the months of December 2007 and January 2008 and demanded immediate payment. A summary action for possession as the result of non-payment of rent was filed against defendant on March 11, 2008.

In late February and early March 2008, a dispute arose as the result of defendant's attempt to deny access to the property to plaintiff's plumber and electrician to re-establish a supply of hot water to the building's residential tenants. When matters were not resolved, on March 18, 2009, plaintiff filed a verified complaint and order to show cause in the Chancery Division seeking access to the property. That complaint alleged in part as follows:

2. As part of the Real Estate Transaction [resulting in plaintiff's purchase of the property], Plaintiff/Landlord inherited a Tenant through an Assignment of Leases and from that date Defendant/Tenant has been a problem.

3. Upon information and belief, prior to Plaintiff taking ownership of the property, Defendant completed work on the property, including the movement of the HVAC System and other plumbing work.

4. On November14, 2007, Plaintiff had the property inspected based on a Complaint of lack of heat by the Tenant. The Tenant was notified that the HVAC System that he had installed, had been installed incorrectly and constituted a Fire Hazard and had to be corrected within 10 days of the date of the Notice letter.

5. Defendant/Tenant refused to have the proper repairs made to the HVAC System which they installed improperly. Due to the nature of the situation (Health & Safety Issue) Plaintiff had the work completed at a cost of $6,800.00.

The complaint also alleged three attempts by plaintiff, on February 24, February 29 and March 6, 2008, to have plumbing and electrical work done on the property, consisting of the installation of two additional water heaters to provide hot water to the building's residential tenants, an inspection of "the status of the water meters," and a determination "whether there [was] a crossing of the pipes between the Commercial Tenant and Residential Tenants," and that access had been refused. However, the Chancery action does not appear to have been pursued. Litigation, instead, focused on plaintiff's initial complaint for non-payment of rent, which was transferred on May 1, 2008 from the Special Civil Part to the Law Division as the result of defendant's motion. The order of transfer required defendant to pay rent into court on or before the fifth day of every month.

On May 12, 2008, defendant filed an answer to the possession action, together with a counterclaim seeking monetary damages from plaintiff as the result of plaintiff's alleged breach of contract, misrepresentation and unjust enrichment. As a factual matter, defendant alleged that plaintiff had failed to maintain the building's heating and cooling systems, failed to provide defendant with the one-half of the basement space that the lease required, misrepresented the availability of parking spaces at the rear of the building, failed to update the building's sprinkler system, failed to make payments for gas, water and electricity, failed to make necessary ceiling repairs caused by water damage, and failed to separate the heating system for the basement.

Thereafter, on July 18, 2008, plaintiff filed an amended complaint. That complaint alleged breach of lease provisions requiring payment of rent; maintenance of the premises in a clean condition, free from debris; maintenance of general public liability insurance in specified amounts; indemnification for losses caused by defendant; and provision of access; and it declared defendant's breaches to constitute events of default by defendant pursuant to the lease. In the multiple counts that followed, plaintiff first sought defendant's removal for non-payment of rent from December 2007 through June 2008 and non-payment of additional charges incurred as the result of defendant's improper installation of HVAC equipment and improper plumbing alterations, requiring the installation of a new water meter. In succeeding counts, plaintiff sought removal for breach of lease covenants consisting of interfering with plaintiff's right of entry, failure to maintain insurance, the unauthorized alteration of the heating system, the unauthorized alteration to the water plumbing system, and failure to maintain the premises and to remove debris. The complaint also sought removal for disorderly conduct consisting of defendant's conversion of plaintiff's water utility meter for defendant's own use, and relocating and removing the furnace without ...


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