Court allows Sears sublease at Gardens Mall

An appellate court declared unconstitutional city restrictions on subleases by the mall's anchor tenants

Jul.July 29, 2017 10:00 AM

The Sears store at Gardens Mall in Palm Beach Gardens

Sears, Roebuck & Co. won a legal fight over its plan to sublease part of its store at the Gardens Mall in Palm Beach Gardens.

Sears wanted to sublease the second floor of its department store at the Gardens Mall. But blocking Sears was a city resolution that prevented anchor tenants at the mall from subleasing their space without approval from the city of Palm Beach Gardens and the mall’s landlord, Forbes/Cohen Florida Properties LP, which rejected the sublease.

Sears sued the landlord and the city to proceed with its planned second-floor sublease agreement with Dick’s Sporting Goods, but a Palm Beach Circuit Court judge ruled in favor of the defendant.

Sears successfully appealed that ruling to the Fourth District Court of Appeal. The state appellate court ruled that the city resolution is unconstitutional and awarded attorney fees to Sears.

“We conclude that the city unconstitutionally impaired Sears’ right to contract and deprived Sears of its rights to substantive due process,” the appellate court said in its ruling. [Daily Business Review] – Mike Seemuth

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