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Kohl’s Files Suit Against Landlord
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Kohl’s Files Suit Against LandlordKohl’s Department Stores (414-703-7000) filed a suit against Equitable Life Assurance Society of the United States alleging that it overpaid more than $629,000 on occupancy costs for a store at Westland Shopping Center in Westland, MI because Equitable improperly divided its pro rata share of the costs of operating and maintaining common areas. In the suit, Kohl’s said that Equitable officials said that the costs would be assessed in a way similar to those charged Dayton Hudson. Kohl’s suit says a 1999 audit showed that Equitable billed Dayton Hudson at a fixed rate since at least 1995 and that charges billed to Kohl’s have been inconsistent with that of Hudson’s fixed per-square-foot charges since at least 1994. The suit also claims that Dayton Hudson before 1995 got various exclusions from billings that were not available to Kohl’s. Kohl’s inherited the rights under the lease in 1988, when it bought the company that then held the lease. The lease contained a clause exempting Kohl’s from the operating maintenance charges if it "is able to demonstrate that Hudson has not paid for the same charge or similar charges on a consistent basis." Because Kohl’s was charged on a pro rata basis for the common-area costs while Dayton Hudson was charged a fixed rate, Kohl’s overpaid by at least $629,687, the suit says. Kohl’s filed a backup position in its suit, saying if the calculation of Kohl’s charges is found not to constitute a breach of the lease, then Equitable breached the lease by charging certain costs to Kohl’s that were not charged to Dayton Hudson. In that case, Kohl’s overpaid Equitable by at least $370,442. |