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LLC v. LiveDeal, Inc.

Court of Appeals of Arizona, First Division, Department D

October 1, 2013

J3 HARMON, LLC, a Nevada limited liability company. Plaintiff/Appellee,
v.
LIVEDEAL, INC., a Nevada corporation fna Y.P. Net, Inc., Defendant/Appellant.

Not for Publication – Rule 28, Arizona Rules of Civil Appellate Procedure

Appeal from the Superior Court in Maricopa County Cause No. CV2012-001133 The Honorable Robert Oberbillig, Judge.

Sanford J. Germaine, P.C., Phoenix By Sanford J. Germaine Attorneys for Plaintiff/Appellee.

Reade & Associates By R. Christopher Reade Attorneys for Defendant/Appellant Las Vegas.

MEMORANDUM DECISION

DONN KESSLER, Judge.

¶1 LiveDeal, Inc. ("LiveDeal") appeals the summary judgment entered in favor of J3 Harmon, LLC ("J3"). We find that summary judgment was appropriate because no material facts are genuinely in dispute. We modify the damage award, however, because we find no legal basis to charge LiveDeal rent beyond the expiration of the lease term.

FACTUAL AND PROCEDURAL HISTORY

¶2 J3 sued LiveDeal for defaulting on rent owed under the parties' lease ("the Lease") . J3 requested damages for unpaid rent and other sums, including late charges, interest on past due amounts, and attorneys' fees.

¶3 The relevant lease term extended from July 1, 2006 to June 30, 2011. Monthly base rent from July 1, 2010 through the expiration of the term was $10, 734.08, plus taxes and fees. The Lease included neither an option to extend nor any right to hold over past its expiration. Instead, the Lease provided that LiveDeal's monthly rent would double for any additional months that it remained in possession of the premises beyond the expiration of the lease term.

¶4 The Lease included several non-exclusive remedies provisions, including the following:

13.2 Remedies. If Lessee fails to perform any affirmative duty or obligation of Lessee under this [L]ease . . . Lessor may:
a) Terminate Lessee's right to possession of the Premises . . . in which case this Lease . . . shall terminate and Lessee shall immediately surrender possession of the Premises to Lessor. In such event, Lessor shall be entitled to recover from Lessee: (i) the worth at the time of the award of the unpaid rent which had been earned at the time of termination; (ii) the worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that the Lessee proves could have been reasonably avoided; (iii) the worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time of award exceeds the amount of such rental loss that the Lessee proves could be reasonably avoided . . . . (Emphasis added.) Thus, J3's remedies included recovering unpaid rent for the balance of the lease term minus any rental losses that LiveDeal could prove were reasonably avoidable.

¶5 J3 submitted a tenant ledger ("the Ledger") to prove the amount owed under the Lease. The Ledger's itemized accounting of charges accrued since April 1, 2011 totaled $56, 737.40 and included $12, 075.81 of base rent and fees for July 2011, and $4, 025.28 of prorated rent and fees for the first ten days of August 2011.

ΒΆ6 LiveDeal asserted various affirmative defenses in its answer, including that J3 failed to mitigate its damages. However, LiveDeal's answer lacked factual support for those defenses. Thereafter, J3 moved for summary judgment. LiveDeal opposed the motion, arguing that the amount owed and ...


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