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Sandy Aznovario leased a corner space in a shopping center to operate Olde Style Buffet, an all-you-can-eat buffet geared toward senior citizens and families. The buffet was especially popular on weekends, and its best business was done on Sundays, before and after people in the community normally attended church.

Kathy Miley was the landlord for the shopping center. She and Sandy signed a net net lease (double net lease), clearly stating that maintenance and repair of the HVAC system would be the responsibility of the shopping center's commercial real estate company.

Easter Sunday, the Buffet's busiest day of the year, the head cook reported to Sandy that the overhead exhaust system in the kitchen was not working, and the kitchen was becoming unbearably hot, smoky, and humid. Sandy called the landlord's leasing office and heard a recorded message stating the office was closed because of the Easter holiday.

Sandy then contacted Beatty's 24-hour Emergency HVAC Repair Service, which sent a representative, who examined the HVAC system, then replaced a broken fan belt on the rooftop exhaust fan. Sandy submitted the bill from Beatty's, including a triple-time labor charge for holiday service, to Kathy Miley's company for payment. Kathy refused to pay the bill, stating that Beatty's was not the authorized HVA C service company used by Miley, nor did the lease specifically state that HVAC service would be provided on holidays.

Discuss the following:

1. Who is responsible for this bill?

2. What could have been done beforehand to avoid this conflict from occurring?

Operation Management, Management Studies

  • Category:- Operation Management
  • Reference No.:- M92026156

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