Penalty or Remedy: Co-Tenancy Clauses

July 28, 2015 • ABA Webinar — Ellen Sinreich was a panelist at an American Bar Association webinar about the recent California Court of Appeals decision on the enforceability of so-called “co-tenancy clauses” in retail leases. These common provisions allow retail tenants to abate rent and/or terminate their lease if the landlord fails to maintain other required tenancies at the shopping center. In a case of first impression, Grand Prospect Partners, LP v. Ross Dress for Less, the court upheld the tenant’s termination right, but struck down the rent abatement remedy as an unenforceable penalty.