White City Shopping Center v. PR Restaurants, LLC
21 Mass. L. Rptr. 565 (2006)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
When a term in a contract is not defined, it is to be interpreted according to its ordinary and common-sense meaning. The party who drafted the contractual provision bears the responsibility for any lack of clarity or failure to use more specific language.
Facts:
- PR Restaurants, LLC ('PR'), which operates a Panera Bread franchise, entered into a ten-year commercial lease with landlord White City Shopping Center, LP ('White City').
- PR drafted an exclusivity clause for the lease, which prohibited White City from leasing space to any business expected to have annual sales of 'sandwiches' greater than ten percent of its total sales.
- The lease did not provide a definition for the term 'sandwiches,' and the parties did not discuss or agree upon a specific meaning for the term during negotiations.
- Subsequently, White City began negotiations to lease space in the same shopping center to Chair 5 Restaurants ('Chair 5') for the operation of a Qdoba, a Mexican-style restaurant that sells burritos, tacos, and quesadillas.
- PR learned of the negotiations and asserted that Qdoba's products fell within the meaning of 'sandwiches,' claiming a lease with Chair 5 would violate the exclusivity clause.
- Despite PR's objection, White City proceeded to execute a lease with Chair 5.
Procedural Posture:
- Plaintiff White City Shopping Center, LP filed a declaratory judgment action against defendant PR Restaurants, LLC in the Massachusetts Superior Court.
- PR filed counterclaims against White City for breach of contract and other violations.
- Chair 5 Restaurants was permitted to join the lawsuit as an intervening party.
- PR, the defendant, moved for a preliminary injunction to enjoin White City from allowing Chair 5 to operate a Qdoba restaurant in the shopping center pending the outcome of the litigation.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does the undefined term 'sandwiches' in a commercial lease's exclusivity clause encompass items like burritos, tacos, and quesadillas, thereby prohibiting the landlord from leasing space to a Mexican-style restaurant that sells those items?
Opinions:
Majority - Locke, Jeffrey A., J.
No. The undefined term 'sandwiches' in the lease's exclusivity clause does not encompass burritos, tacos, and quesadillas. When contract terms are plain and unambiguous, they must be construed according to their ordinary and usual sense. The court, referencing the dictionary definition, found that a 'sandwich' consists of two pieces of bread with a filling between them. Burritos, tacos, and quesadillas, typically made with a single tortilla, do not fit this common understanding. As the drafter of the clause, PR had the opportunity and burden to define 'sandwiches' more broadly if it intended to include such items, but it failed to do so. Therefore, PR has not demonstrated a likelihood of success on its claim that White City breached the lease.
Analysis:
This decision emphasizes the paramount importance of precise and explicit language in contract drafting, particularly for restrictive covenants like exclusivity clauses. It serves as a strong reminder of the legal principle that ambiguities in a contract are often construed against the drafter. The court's reliance on the 'ordinary meaning' of a common term reinforces a default rule of interpretation that disfavors broad, unstated intentions. For future commercial tenants seeking exclusivity, this case signals a clear need to define protected product categories with exhaustive specificity to prevent competitors from exploiting definitional loopholes.
Unlock the full brief for White City Shopping Center v. PR Restaurants, LLC