Kridel was getting married, and so he signed a 2 year
lease with Sommer to get a nice apartment in Sommer's building. He paid
the first month's rent in advance.
The engagement fell through before Kridel moved in.
Without his wife's parent's income, he could not afford the rent. He
wrote a letter to Sommer explaining the situation.
Kridel never moved in and never received a key.
Sommer did not answer the letter.
Even after receipt of Kridel's letter, Sommer did not
attempt to re-rent the apartment, and in fact turned away at least one
applicant. The apartment remained vacant for 15 months.
Sommer sued Kridel, demanding $7k, which was the amount
due for the full two-year lease.
This was later amended to just the $5k that was due
between Kridel's default and when Sommer eventually re-rented the
apartment.
The Trial Court found for Kridel. Sommer appealed.
The Trial Court found that the landlord had a duty to
attempt to re-rent to the apartment and mitigate damages (aka a duty to cover).
In addition, Sommer's lack of response to Kridel's letter
was an implicit acceptance and a termination of the lease.
The Appellate Court reversed. Kridel appealed.
The Appellate Court looked to Joyce v. Bauman (113
N.J.L. 438, 147 A. 693 (E&A 1934)), which held that landlords could
recover even if they made no attempt to mitigate.
It said the same thing in Restatement of Property
11.1(3).
The Court basically found that when a landlord
leases a property, he gives up property interest. The property
effectively becomes the possession of the tenant. Therefore, the
landlord cannot re-rent the property since he doesn't own it. And the
tenant can't abandon the property, since it still belongs to him whether
he lives there or not.
The New Jersey Supreme Court reversed.
The New Jersey Supreme Court found that a landlord does
have an obligation to make reasonable efforts to mitigate damages, even
if the apartment was wrongfully vacated.
The Court overturned Joyce.
The Court found that the law should be governed by modern
notions of equity and fairness, and not antiquated notions of property
law. This was more of a contract law question, and in contract law, you
have a duty to mitigate.
The New Jersey rule requiring mitigation is not followed
in a lot of jurisdictions. It is still disputed law.
