Savesure Department Stores was a chain of discount stores offering low-priced consumer products in a no-frills environment.The company had found great success particularly in urban centres where it offered many name-brand or comparable products at prices far below the competition.As a result,Savesure had built a network of over 50 franchised stores,many located in shopping centres.
One of its stores was located in a leased building on the main street of a large city directly opposite a major shopping centre.The lease provided for a minimum annual rent of $24,000 payable monthly plus 10 percent of gross sales revenue.The lease also contained a covenant that the tenant would not open one of its stores within a five-mile radius of the existing leased premises.
After several years the landlord sold the property and assigned the lease to the purchaser.The new owner then discovered that Savesure had been operating a store in the shopping centre across the street for five years.
What issues does this case present? What rights,if any,does the new landlord have?
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