01x110 - Restaurant Nightmare

[bunniefuu]

- [Judge Judy] You subleased a restaurant?
- Yes.

The building had termites,
the roof was leaking, it had rats.

That's not true.

[Judge Judy] Did you have the restaurant
and the building inspected?

I inspected it myself.

- Well, that's a problem.
- Okay.

[announcer] This is Judy Justice.

[theme music playing]

[announcer] James Ray is suing
businessman Albert Luevano

for illegally changing the locks
to his restaurant and stolen property.

[Kevin] Court come to order.

Be seated, please.

[Kevin] Hello, Judge.
Case 1090, Ray versus Luevano.

- Thank you.
- You're welcome.

[Judge Judy] Mr. Ray,
according to your complaint,

you subleased
a restaurant from the defendant?

- Yes.
- [Judge Judy] He changed the locks

on the door of the restaurant
at some point,

you claim illegally.

And inside the restaurant,
you had some equipment,

deep freezer and some other things?

- Yes.
- [Judge Judy] So you are suing him

for illegally changing the locks,

and taking items without permission,
the items that you're talking about

are the items that were left in
the restaurant, that you had purchased?

- Yes.
- [Judge Judy] That's what the case

- is about?
- [James] Yes.

The defendant is countersuing
for breach of contract,

the fact that one of the checks
that you gave him for the last month

that you were actually there prior
to his changing the locks,

bounced, that's the check for June
of this year, I assume, 2021?

Yes, Your Honor.

[Judge Judy] And damages
that he claims were done to the property?

So that's generally what the case
is about?

- Yes, Your Honor.
- [Judge Judy] So I'm gonna start

- with you. Mr. Luevano?
- [Albert] Yes, Your Honor.

[Judge Judy] The restaurant
that Mr. Ray was leasing, you did not own?

[Albert] I did not own the property.

[Judge Judy] You did not own the property?

Give me the address, so I don't keep
having to refer it as the property.

Give me the numerical numbers.

- 1205...
- [Judge Judy] 1205?

In what year did you lease that 1205?

- 2012.
- [Judge Judy] From whom?

From Shopping Center.

And was it in 2012
that you put in a restaurant?

Yes, I did.

[Judge Judy] What kind of restaurant
did you put in?

[Albert] A high-end deli.

[Judge Judy] So from 2012
to what year was it a high-end deli?

From 2012 to 2013.

And that didn't work out?

[Albert] Um, it did, but I upgraded
for...what the community wanted,

which was the O-Hi Frostie,
it was a burger joint.

- So you changed it?
- [Albert] Yes.

Now, Mr. Luevano, you're a businessman?

Yes, Your Honor.

[Judge Judy] And I'm sure
that you've heard the expression,

"If it ain't broke, don't fix it."

Why would you try something new if
the original deli

was going gangbusters?

Because the O-Hi Frostie
was actually doing much better than...

[Judge Judy] So in 2013,
you changed it into an O-Hi Frostie,

and how long was it an O-Hi Frostie?

[Albert] Until, um, March 15th, 2020.

[Judge Judy] Now, I would assume
that your restaurant,

like most restaurants, after January,

February of 2020,

had a deep decline in business?

- Yes, Your Honor.
- [Judge Judy] Okay. That's fair.

That was a result of the pandemic?

- Yes, Your Honor.
- [Judge Judy] And at that point,

you decided to sublease the restaurant?

[Albert] Um, actually, no, Your Honor,
I, um...

[Judge Judy] What...in what month
did you sublease the restaurant?

Not until September of 2020.

[Judge Judy] And in September of 2020,
you found Mr. Ray?

- Yes, Your Honor.
- [Judge Judy] Go back a second.

In 2012, what was the term
of your lease?

[Albert] Uh, my term of my lease was...
um, it was

a three-year perpetual lease,
so every three years, I would be able to,

- uh, continue...
- [Judge Judy] There's never a three-year

perpetual lease.

It's annual options for how long?

Forever.

[Judge Judy] Do you have
a copy of that lease?

- Yes, I do.
- [Judge Judy] I'd like to take look

at it.

No, you didn't, sir.

I'm gonna explain to you what this means,

this lease that you just gave me

is a six-year lease, three and three.

If you want it beyond the three years,

you have to agree with the landlord

on new terms, what the rent
will be and what the terms are.

So you don't have a perpetual lease
with him,

I don't know where you got that idea
in your head.

You had a three-year lease
at a particular rate,

with particular terms to it.

And if you wanted to lease beyond
that time,

you had to come up with an agreement
with...regarding different rent,

did you ever come up with an additional,
uh, agreement with him?

Yes, every three years.

[Judge Judy] Well, this is the first one,
and this takes us...this is 2012,

so six years, 2018.

Where's the 2018 lease?

May I?

Absolutely.

Okay. So, at best,

you had an interest in this restaurant

that was housed in the building

until January 31st, 2024?

- Yes, Your Honor.
- [Judge Judy] That's best.

Okay. Mr. Luevano,

because your business
was failing because of COVID,

he decided he could make
a restaurant work, a seafood restaurant.

So during COVID,
you're probably one of the few people

in the universe that bought a restaurant.

My first one was doing very well

and, um, when I'd seen his on, on LoopNet,

I'm seeing like a similar floor plan,
almost exact same size.

[Judge Judy] And you could do takeout?

[James] And I can do takeout,
but it was advertised kind of as turnkey,

- but, uh...
- [Judge Judy] Just a second,

- hold on there.
- [James] Okay.

[Judge Judy] I did...I didn't...
it doesn't require a whole story.

- Okay.
- [Judge Judy] I have to get

- to the legalese first.
- [James] Okay.

[Judge Judy] First, Mr. Luevano
has a premises that he has an interest in,

and I assume could sublet,
although I haven't looked

into that part of the document.

Until 2024, period.

Now, when you signed a lease with him
in September of 2020,

how long was the lease?

[James] To expire, November 30th, 2023.

It was three years with, uh, a few months

for tenant improvements.

[Judge Judy] Great.
Can I see the lease that you have?

[James] That lease that I signed.

[Sarah] Do you want me
to look for a sublease provision?

[Judge Judy] Yeah.
You can do that, please.

[Albert] Your Honor,
the lease agreements were negotiated

between Equinox,

um, Isaac, and, uh, Mr. Ray.

[Judge Judy] So you...

And all the information
that was gathered was...

between the two of them
and I just agreed to it when it...

[Judge Judy] Well, then, what did you go
in and change the locks for?

So you were told on June 18th

that they weren't going to honor this?

Exactly right.

[Judge Judy] Then you should've paid
June's rent.

- Exactly right.
- [Judge Judy] But you didn't.

Right.

- [Judge Judy] [chuckles] So he changed
the locks.

[announcer] James Ray claims
businessman Albert Luevano

illegally changed the locks
to his restaurant and stole his property.

[Judge Judy] Now, he says
that he told you that he wanted out

of the lease because he wasn't doing
the business he thought he would do.

He wanted that, I think, in July.

- [Albert] July 1st, Your Honor.
- [Judge Judy] Okay.

And then you changed the locks
on what date?

- July 1st.
- [Judge Judy] Which made it

incapable for him to get his stuff back?

[Albert] No, Your Honor.
We gave him the opportunity

to come and get his stuff.

You're not a we, Mr. Luevano.

You say you had nothing to do
with negotiating this original lease.

You said he negotiated it
with somebody else?

My broker, yes, Your Honor.

Well, your broker then is your agent?

- Yes, Your Honor.
- [Judge Judy] So I want you to tell me,

sir, why you changed the locks
on July 1st.

[Albert] Um, Your Honor, on June 17th...

- [Judge Judy] Just a second.
- [Albert] Oh, I'm sorry.

[Judge Judy] Let's go...
let's go back a second.

Okay.

How much was the rent
you were charging him?

[Albert] The sublease was
$2,000 a month until May 30th...or 31st.

And then in June 1st,
it went up to $2,500 a month.

And how much were you paying
the landlord on your lease?

[Albert] Um, I'd say $1,627.54.

- [Judge Judy] So you were making money?
- Yes, Your Honor.

[Judge Judy] I'm just putting this
into perspective.

You got out of that restaurant
because you were losing money

in that restaurant because of COVID.

He took over the lease

and he paid you in September?

- No, Your Honor.
- [Judge Judy] He had...

- There was no key money.
- [Judge Judy] Okay.

On what month did he start
to pay you rent?

In January. We gave him three months
of free rent to get situated,

and then he got two more months
of half rent,

because the roof was leaking
and we had to get that repaired.

[Judge Judy] September, October, November.

So far you got three months, free rent
to begin with, is that right, sir?

To get the health permit, right. Yeah.

[Judge Judy] He's running
a, a losing business, and right now,

he's responsible for the rent
to his landlord.

- [James] Right.
- [Judge Judy] So he felt

as if you'd cover that, what were you...

or maybe he worked it out
with the landlord.

Did you work out those three months
with your landlord?

- Look at me.
- [Albert] No. I, I...

- Did you pay?
- [Albert] I ate that...I ate that time.

[Judge Judy] You never defaulted
on any payment to the landlord?

[Albert] Correct, Your Honor.

[Judge Judy] Okay.
So he ate the three months

and then you paid half rent
for two months?

- Yes.
- [Judge Judy] When did you start

paying him $2,000 a month?

[James] March.

[Judge Judy]
When was the restaurant opened?

January 15th, I think.

[Judge Judy] Did you do any business
in January?

- Yes.
- [Judge Judy] February?

- Yes.
- What happened in March?

[James] Uh, the building just start...
as, as I opened up, the building...

I'm just finding all kind of issues
with the building.

And I find the things
that weren't up to code.

[Albert] Your Honor, that's not true.

The restroom wasn't ADA compliant,
so I couldn't hire a person

in a wheelchair, it was...
uh, I think he put the restroom together.

Your Honor, everything
was up to code, I'm sorry.

- [Judge Judy] Just a sec.
- No, I...

[Judge Judy] It was working...
uh, if everything was working,

including his business,
it wouldn't have been a problem,

but you did in fact say that the roof
was leaking, that had to be fixed?

- Yes, and that was part...
- [Judge Judy] Okay.

...of the, the inspection by,
by the health department.

[Judge Judy] Okay.
Before you entered into this lease,

did you have the restaurant
and the building inspected?

[James] The health department
wouldn't review it until I had control

of it and I submitted architectural plans
before they would even come out.

Even if I offered to pay them a fee,
she said, "No, we do not..."

[Judge Judy] No, you can't tell me
what they said to you, sir.

- You inspected it yourself?
- [James] Right.

Which sort of is not a very smart thing
to do rather than you investing

a lot of money in a place.

If I buy a house,
I get a professional inspector

that goes in and inspects the house,
gives me a report,

said house needs a new boiler,

it needs new AC system.

There's mold on the back deck.

You get, uh, a report.
All right.

Now, when you told him
that you were moving out,

you told him
that you were gonna move out initially,

according to your papers in January?

No. I requested a cancellation
of lease because the work conditions

were not safe for, um, the younger staff

- that I had working there.
- That's not true.

[Judge Judy] I don't want you to interrupt
me again.

- [Albert] I'm sorry, Your Honor.
- Or him.

[James] I have it on a email.
It was June 18th, I think, or 17th.

It was this form as a...
I requested a cancellation of lease,

they never responded back.

Okay. So you wrote to them,
but they never answered you?

Yeah, I signed it and sent it to them.

[Judge Judy] And that's June 18th.

Well, you signed it, just 'cause
you asked for it, doesn't mean you get it.

- [James] Right.
- Okay.

So June 18th, you wanted a cancellation
of the lease on what date?

[James] I told him, uh...

[Judge Judy] Not, "I told him."
Kevin, Kevin...

[James] This says cancellation
on July 1st and you can keep

the deposit to cover that June's rent.

That's what all that form says.

[Judge Judy] Well, you can't do that.

A, you can't tell him to keep
the deposit for June's rent.

Deposit is after he makes an inspection.

If you take a deposit
from somebody for an apartment,

then business is no different.

The deposit is for whatever damage it is.

You can't say,
"You can keep my deposit for June's rent."

I know that, that a lot of people do that,
but it's...you're not allowed to do that.

[James] Okay.

Well, you got this nice form, cancellation

of lease by mutual consent,
but he never signed it. [chuckles]

[James] Right.
That's why I said I was requesting it.

- [Judge Judy] Just a sec.
- Because it doesn't [indistinct]

[Judge Judy] He never...just a minute.
He never signed it.

- Do you have an answer...
- [Albert] Your Honor...

- [Judge Judy] ...to that?
- [Albert] Yes, Your Honor.

- The email...
- [Judge Judy] Can I see it, please?

These...uh, the emails indicate
that he never indicated to me

that there was anything unsafe
or unsatisfactory in any way.

Also, he indicated that he wasn't
doing very good in business.

Shh.
I can read.

- [Albert] And he wanted...
- I can read.

Oh, I'm sorry, Your Honor.

All right. So, he does tell you,
you can't use your deposit funds

for rent, which is true.

And he says,
"Let me know when you will leave

the keys and when you anticipate
your final day to be."

Well, you negotiating with his broker,
who was his agent, and it says,

"Personal property are now
in the possession of the landlord

and rent will have to be brought current
for personal property to be released."

That doesn't sound unreasonable, does it?

Uh, when he locked me out, yes.

[Judge Judy] Why?
You wrote him a letter,

June 18th that says you were cancelling

the lease as of July 1st.

I was requesting a cancellation.

I can't cancel a lease unless
he agrees to it.

[Judge Judy] You said to him
that you weren't paying June's rent.

You said to him in here.

Did you ever pay June's rent?

- I never paid June's rent.
- [Judge Judy] Just a second.

That's very easy.

So you acted upon
this even though he didn't sign it.

And you followed the terms
of your document by not sending him

June's rent, and by telling him to take

the deposit and use that,
apply that to my last month's rent.

He never agreed to that.

So since he never agreed to it,
I was moving forward as

if it's still my property.

Then you would've paid June's rent.

Did you ever get written
permission to sublet...

[Albert] I did not have written permission
from the landlord.

- The permission to sublet this property?
- I had verbal permission.

You can't get permission
unless it's in writing!

Yes, Your Honor.

[laughs] Period.

[announcer] James Ray claims
businessman Albert Luevano

illegally changed the locks
to his restaurant and stole his property.

[Judge Judy] Okay.
When were you going to pay June's rent?

You were told by the broker on June 18th
when they got a copy of this.

Right.

[Judge Judy] "Hi, James,
please note that tenancy obligations

will hold as agreed per the lease
until it's filled by another tenant.

We have started to market the space
and will advise as interest is expressed."

So you were told on June 18th
that they weren't going to honor this?

Exactly right.

Then you should've paid June's rent.

- Exactly right.
- [Judge Judy] But you didn't.

- Right.
- [Judge Judy] So he changed the locks.

You said you did exactly
what you said you were going to do

in this unilateral contract.

- You didn't...
- [James] No, but that...

[Judge Judy] ...June's rent
and you said you were leaving July 1st.

[James] That was a request. [scoffs]

- It, it...
- [Judge Judy] But it was a request

that you acted on, sir,
by not paying June's...

- No, I did...no, I needed a...
- [Judge Judy] You did.

I needed a response
from him so I would know...

You, you got a response
from him the same day.

[James] So I'm assuming...
I'm assuming the...

- [Judge Judy] No, no, no.
- ...the property is still mine.

- [Judge Judy] No, sir.
- I wouldn't have $20,000...

[Judge Judy] You got a response,
Mr. Ray, the same day,

the exact same day
as the broker got your request.

- [James] Right.
- [Judge Judy] You got his answer,

and he said to you, "Got your note.

You're responsible for this lease."

- [James] Right.
- "We'll start to market it again,

but you're responsible for this lease.

So we're not agreeing to this."

And they never signed it.
You were told that the exact same day.

So if you wanted to honor
the terms of the lease,

sir, you would've paid June's rent.

- Wait...
- [Judge Judy] Which you never did.

And they didn't lock you out until July 1

when you still hadn't paid the rent.

[Albert] That's correct, Your Honor.

Well, the rent would've just been
late rent.

You can't lock somebody out of the...
out of their...out of their building.

- That's ill*gal. [chuckles]
- [Judge Judy] Just a second.

[Sarah] Sub-section 10
of the defendant's lease prohibits

subleasing for what that's worth.

There's some language
about what happens if it is sublet,

but initially it is prohibited.

Unless written consent
is signed by the lessor.

Did you ever get written permission
to sublet this property?

- Um, originally...
- [Judge Judy] Did you

- [Albert] I...
- That's a question.

Did you ever get written permission
to sublet the...

I, I did not have written permission
from the landlord.

[Judge Judy] ...permission to sublet
this property?

I had verbal permission, Your Honor.

It doesn't say verbal,
it says without written consent

of the lessor.
That's the shopping center.

- Yes, Your Honor.
- You're not allowed to sublet this.

[Albert] Well, the landlord
did give me permission, but...

[Judge Judy] You can't get permission
unless it's in writing!

- Yes, Your Honor.
- Period! [laughs]

That's what your lease says.

[Albert] I, I have written
permission, um, he just, um...

[Judge Judy] You had no...well,
if you have written permission,

I suggest you show it to me.

[Albert] I, I don't have it on me,
so I can't claim that I have it.

- [Judge Judy] Well, well...
- But I, I did have it.

[Judge Judy] ...and it doesn't exist,
'cause that's what we're here for today.

And that's what you're suing for,
you want money owed for breach

of contract, for a property
that you had no right to sublease.

That's not what my understanding
of the contract was, Your Honor.

- [Judge Judy] Just...
- [Albert] The landlord explained to me

- that I did have permission...
- [Judge Judy] No, no. Just a second.

You can't tell me what the landlord
explained to you.

What the landlord explained to you
was verbal.

Now, so now we get to what's fair.

Now, we have somebody who breached
a contract, that they thought

was a legitimate contract,
which turns out to not be

a legitimate contract, got it?

Were you in the premises in June?

- Yes.
- All of June?

[James] It was...it was
in the middle of June when I,

I told him that it was
just not safe to work here anymore.

[Judge Judy] Just a second.

It was in the middle of June
when you left?

Well, I'm not understanding
when you're saying when I left.

[Judge Judy] Okay.

[James] When I...when I closed
the business down...

Your counterclaim
is dismissed by the way,

because you have no proof
that you had a right to sublet anything,

- do you understand?
- I, I understand, Your Honor.

[Judge Judy] Very good.

You weren't in the premises
when the locks were changed,

you weren't doing business
in that premises.

You suffered no loss
and you paid no rent in June.

I don't find that you were out
of anything.

Now, they have property
that belongs to you.

Where is his freezer that he wants,
and his grills, and his fryer.

- Where is all that?
- [Albert] Everything's still

in the restaurant, as far as I know.

[Judge Judy] Okay. Okay.
What is in the restaurant, sir...

- Yes.
- [Judge Judy] ...that you purchased?

- It's a...
- [Judge Judy] Just tell me.

It's a laundry list.

[Judge Judy] I...well,
I don't want a laundry list.

I want the main items that are in there.

[James] The main items that are expensive
is a commercial refrigerator,

commercial freezer,


He says that the freezer is still there,

and the fryers are still there.

I will give you the ability
within five days to go and get them.

That's all...

[Judge Judy] With a marshal,
you can go in.

Refrigerator, freezer,
two thirty-five pound fryers,

and all the signage from your restaurant?

- And a POS system.
- [Judge Judy] A what?

POS, um, to ring up the...like a cash,

cash drawer, electronic cash drawer.

Is it a...something
that's capable of being moved

or was it built-in?

No, it's...you can just pick it up
and take it, it's $1,600.

It has a credit card machine, drawer,
like an iPad on the top.

[Judge Judy] Okay. Mr. Luevano?

[Albert] Yes, Your Honor.

Pay careful attention to me,
is that POS system still

- in the restaurant?
- It should be, yes, Your Honor.

[Judge Judy] Great.
I'll prepare an order,

you take it with the marshal.

You have five days from today's date to
pick up the merchandise.

And if you do not pick it up
within five days,

- on notice...
- [Albert] Your Honor, if I...

[Judge Judy] ...on notice to Mr. Luevano,
then it will be considered abandoned,

do you understand?

But it's just so much more stuff that...

- [Albert] Your Honor...
- It's, it's soup warmers and...

...he did remove and sell a lot
of, uh, the fixtures and other stuff.

[Judge Judy] Well, then you have
the landlord come in here

and complain about that, sir.

You had no right
to enter into a sublease with him.

Judge all of this stuff that I,
I've replaced, I got rid of his stuff

'cause it was no good
and I replaced it with new stuff.

[Judge Judy] I...listen,
he's not going to pay you.

- [James] Oh, I know that.
- Do you understand that?

[James] I just want my equipment back,
that's all wanna...

[Judge Judy] Well, so far you've got
the major equipment back

that you told me that you wanted.

There's still, like,
almost $8,000 worth more stuff.

Like what?

[James] Mop buckets,
heat lamps, soup warmers...

- [Judge Judy] Okay. That's it.
- You know

We're done.
I'll have the order prepared for you,

use a marshal five days,

pick it up,
and you still didn't pay June's rent.

So understand,
I'm not entertaining his counterclaim

for June's rent, because he didn't have
the right to sublet it.

- And then...
- Judge, the building

- had termites, the roof was leaking...
- [Judge Judy] Okay.

...it had rats, it had mice in,
in the ceiling.

[Judge Judy] Next time, mister...
Mr. Ray, get an inspector.

We're done here, five days.
You have the order, get your stuff.

- Can I...
- [Kevin] Court is adjourned.

[James] Oh.

Uh, it was a fair decision.

Uh, I really just wanted
my equipment back.

Well, she did what she had to do.

I was spending a fortune
on just trying to update it.

He inspected it himself.

The health department came in,
made him bring everything up to code.

Get an inspection.

And make sure you have
all your paperwork when you go to court.

[Judge Judy] Aside from the fact
that there's a lot of sadness

in the restaurant businesses
as a result of the pandemic,

so lawsuits like these
are going to proliferate, I think.

The one takeaway I think
for everybody is when you sign a lease

and you make a deposit,
that deposit is not to be used

for your last month's rent.

That deposit is supposed to be there
to ensure that if there is any damage

to the property,
that the funds will be there,

'cause once you move, it's gone.

And I'll know that a lot of people think
that it's okay to do that,

but it is not okay to do that.

It...it's a violation of the lease.

So, I feel sorry for both of them, the
restaurant business was tragically

impacted by the pandemic, took a lot of
guts to open up a restaurant. [chuckles]

- It did.
- [Judge Judy] In September.

[announcer] Want justice?



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