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Wasserman’s, Inc. v. Township of Middletown
Supreme Court of New Jersey
645 A.2d 100 (1994)
Wasserman’s, Inc. (Wasserman’s) (plaintiff) wished to lease property and submitted a bid to the Township of Middletown, New Jersey (Township) (defendant), which accepted the bid. The parties entered into an agreement. The agreement contained a cancellation clause, which provided that in the event the Township cancelled the lease, it would provide pro rata reimbursement to Wasserman’s for any improvement costs and damages of 25 percent of Wasserman’s average gross receipts for one year. Wasserman's made agreed-upon improvements to the property at a cost of approximately $142,000. Wasserman’s sublet the property to Jo-Ro (co-plaintiff) with the Township's permission. The Township later cancelled the lease and sold the property, and Wasserman’s and Jo-Ro brought suit against the Township for the damages stipulated in the lease agreement. The trial court awarded Wasserman and Jo-Ro damages in the amount of the pro rata reimbursement and 25 percent of average gross receipts, as specified in the cancellation clause. The appellate court affirmed, and the Supreme Court of New Jersey granted certification.
Rule of Law
Holding and Reasoning (Pollock, J.)
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