Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Lakeview Collection, LLC v. Bank of America

December 4, 2009

LAKEVIEW COLLECTION, LLC, PLAINTIFF,
v.
BANK OF AMERICA, NATIONAL ASSOCIATION, DEFENDANT.



The opinion of the court was delivered by: Blanche M. Manning United States District Judge

Judge Blanche M. Manning

MEMORANDUM AND ORDER

Plaintiff, Lakeview Collection, LLC, purchased a building from defendant Bank of America on December 29, 2005 and planned to redevelop it into a mixed-use complex. To continue to operate a bank facility at this location, Bank of America agreed to lease the property back from Lakeview until development started. By the end of 2008, however, Lakeview had not started construction and Bank of America had vacated the property and stopped paying rent. Lakeview subsequently filed a suit for declaratory judgment, in which it asks this court to declare that the lease has not terminated and that Bank of America remains liable for rent and real estate taxes. Bank of America has moved to dismiss Lakeview's complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) on the ground that it fails to state a claim upon which relief can be granted. For the following reasons, Bank of America's motion to dismiss is denied.

BACKGROUND

The following facts are taken from Lakeview's complaint and a real estate purchase agreement, which the complaint references and which Bank of America subsequently attached to its motion to dismiss. See Tierney v. Vahle, 304 F.3d 734, 738 (7th Cir. 2002) (on motion to dismiss, court can take into account documents central to the claims of the complaint even if not attached to the complaint). The court accepts these facts as true for purposes of this motion to dismiss. Id.

Lakeview wanted to buy and redevelop property which Bank of America owned and on which it operated a branch bank as well as a drive-through banking facility. Bank of America wanted to complete the sale by the end of 2005, but Lakeview was not ready to begin redevelopment by then. To facilitate the sale, Lakeview agreed to immediately purchase the property in exchange for Bank of America's agreement to lease back the parcels on which it operated the branch bank and the drive-through facility until Lakeview could "complete the process necessary to begin construction." Compl. ¶ 13.

On December 29, 2005, Lakeview and Bank of America executed three separate agreements related to the sale of the property. In the first, Lakeview purchased the Bank of America property ("the Purchase Agreement"). The Purchase Agreement also required Lakeview to begin demolishing and clearing the property no later than February 28, 2007. Lakeview further agreed to obtain all necessary permits and to begin construction of the mixed-use complex by June 30, 2008.

In the second agreement, Bank of America leased back from Lakeview the parcels on which it had been operating its branch bank and its drive-through facility ("the Existing Space Lease Agreement"). The Existing Space Lease Agreement provided that it shall "terminate on the date that is the later of (i) August 31, 2006, or (ii) one hundred twenty (120) days after Landlord provides written notice to Tenant that Landlord intends to demolish the structures on the Main Parcel and commence construction at the Main Parcel.." Existing Space Lease Agreement (attached as exhibit to Complaint) at ¶ 2.

The Existing Space Lease identified two other circumstances under which the lease would terminate: in the event of default, or in the event of condemnation. Existing Space Lease Agreement ¶¶ 13, 21(a).

Finally, Lakeview and Bank of America entered into a Temporary Space Agreement. Under the Temporary Space Agreement, Bank of America agreed that upon the termination of the Existing Space Lease, it would continue to lease the parcel on which it operated its drive-through facility, and expressed its intent to lease space for its branch bank in the newly redeveloped portion of Lakeview's complex.

The economic downturn and other issues delayed Lakeview's redevelopment of the property. As a result, Lakeview never gave Bank of America written notice that it intended to demolish the structures and begin construction on the property, an event that would have triggered the termination of the Existing Space Lease Agreement. Compl. ¶¶ 26-27. In May 2008, Bank of America vacated the parcel on which it had operated its branch bank and moved it elsewhere. After doing so, Bank of America paid Lakeview only a portion of the rent due for the branch bank under the Existing Space Lease for the months of June through October 2008. Bank of America continues to lease the parcel on which it operates its drive-through facility, but purports to do so under the Temporary Space Lease Agreement, not the Existing Space Lease Agreement. Compl. ¶¶ 29, 31.

Lakeview filed suit in state court seeking a declaratory judgment under 735 Ill. Comp. Stat. 5/2-701, asking the court to declare that the Existing Space Lease Agreement has not terminated and that, as a consequence, Bank of America remains liable for rent and real estate taxes according to the Existing Space Lease Agreement's terms. Bank of America removed the case to federal court and has filed a motion to dismiss Lakeview's complaint under Federal Rule of Civil Procedure 12(b)(6) on the ground that it fails to state a claim upon which relief can be granted.

STANDARD OF REVIEW

Rule 12(b)(6) permits a motion to dismiss a complaint for failure to state a claim upon which relief can be granted. To state a claim, the complaint need only contain a "short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). On a motion to dismiss under Fed. R. Civ. P. 12(b)(6), the court accepts the allegations in the complaint as true, viewing all facts, as well as any inferences reasonably drawn therefrom, in the ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.