On August 8, 1994, First Hawaiian Bank Notified Colony Surf

On August 8, 1994, First Hawaiian Bank notified Colony Surf Development that its consent for any leases of mortgaged property was required under various mortgage agreements between the Bank and Colony Surf Development. On November 15, 1994, the Bank and Colony Surf Development entered into a restructuring agreement, which consolidated and restructured Colony Surf Development's debt. Colony Surf began negotiations for JCI to lease the commercial space. Colony Surf Development was represented by its agent, Radomile, in those negotiations.
Eventually, on April 27, 1995, Colony Surf Development and JCI entered into a ten-year lease. Radomile executed the lease on behalf of Colony Surf Development. Under the terms of the lease imposed by the Bank, JCI was required to construct, at its sole cost and expense, all interior improvements to the Commercial Space, the hard costs for which were not to be less than $500,000. The requirement was not disclosed to JCI, and the restructuring agreement with the Bank's requirements had not been recorded in the land records. JCI did put in $163,509.20 in improvements, but the Bank required more and claimed JCI was in breach. JCI filed suit for misrepresentation and asked that the lease be set aside. Colony Surf maintains that JCI was not entitled to rely on Radomile. What should the court decide? Is there a misrepresentation that allows the court to set aside the lease? Does it make any difference that the requirement on the expenditures was not public record?